Principles of good regulation, Financial Management

Principles of Good Regulation

While performing its functions, the FSA needs to take into account certain matters which are termed the ‘principles of good regulation'. The matters like:

  1. Efficiency and economy: The use of the available UK resources in the most efficient and economic way.
  2. Risk management and controls within firms: A firm's senior management is responsible for its activities and for ensuring that its business complies with regulatory requirements. Thus, FSA may hold the senior management responsible for risk management and controls within firms.
  3. Restrictions and benefits: The restrictions imposed on the industry shall be proportionate to the benefits that are expected to result from those restrictions.
  4. Innovations and regulations: Allowing scope for different means of compliance so as not to unduly restrict market participants from launching new financial products and services.
  5. International character of financial services and the competitive position of UK: The cooperation with the overseas regulators in order to meet the international standards and to monitor global firms and markets effectively.
  6. Rules and practices on competition: Minimizes the adverse effects on competition that may arise from its activities and the desirability of facilitating competition between the firms which it regulates.

In addition to its statutory objectives, FSA also has other objectives like:

  • Political and Public Accountability: The annual report contains an assessment of the extent to which it has met these objectives. Scrutiny of the FSA by Parliamentary Committees may focus on how it achieve its objectives.
  • Exhibiting the Way it Carry Out our General Functions: For example, it is duty bound to show how the draft rules relate to its statutory objectives are beneficial to the consumer.
  • Assisting in Providing Legal Accountability: The reason is if it interprets the objectives wrongly, or fail to consider them, it can be challenged in the courts by judicial review.

 

Posted Date: 9/11/2012 2:39:33 AM | Location : United States







Related Discussions:- Principles of good regulation, Assignment Help, Ask Question on Principles of good regulation, Get Answer, Expert's Help, Principles of good regulation Discussions

Write discussion on Principles of good regulation
Your posts are moderated
Related Questions
Why do we need to learn finance The questions that you may thinking about right now are "Why do we need to learnfinance?  Shall we not leave it to people who are going to speci

What is accumulated depreciation? Depreciation is the provision of an asset's initial cost over time.  Accumulated depreciation is the sum of all the depreciation expense that

Twelve cases of leukemia are reported in people living in a certain census tract over a 5 year period. Is this number abnormal is only 6.7 cases would be expected based on national

Imagine you have been allocated $100,000 which is to be invested in 8 companies listed on the Australian Stock Exchange (ASX). You are required to have a balanced portfolio betwee

Bond management evolution to some extent is linked to the increased volatility of the interest rate term structures which is in existence since seventies. Bond valuatio

Types of financial incentive schemes Performance associated pay (PRP) systems e.g. piecework or sales commission Bonuses e.g. supplementary payments for targets or ai

Expalin about the Non-Convertible Debentures (NCDs) NCDs are plain debenture securities issued by corporations. They are normally medium term in nature, maturing between 1 to 8

The first step in valuation process is to estimate the cash flows that are expected to be received in the future. In debt securities, there are two types of possi

Floor Brokers These people have the responsibility of executing the trades forwarded by the FCMs on the floor of the exchange. They can also trade for their own account. They w

Determine the factors of Large organisations -  Greater efficiency and productivity achieves economies of scale -  Easier to manage, organise and control workers through hie