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
Selecting the source of the finance: after prepare of the capital structure an appropriate source of the funds. Various sources of the finance may be raised include share capital

Market development A strategy which seeks to sell existing products in new geographical markets or new market segments. A strategy to find new uses for existing products or ser

how can an operating cycle be applied to a poultry business

Break Even Period: It is also important to compare the returns from the equity stock and the bond to determine the profitability of both investments. Assume that the dividend p

Q. What is denoted by weighted average cost of capital OR Composite? How is it calculated? Exemplify with an example. Ans. Weighted Average Cost of Capital: - Capital formation

International bonds are divided into two categories namely, foreign bonds and euro bonds. Foreign bonds are issued by a borrowing company in another

Q. What do you mean by Misappropriation Of Fund? Misappropriation Of Funds allotted for specific works under capital or Revenue demand but the expenditure is incurred for anoth

What are the assumptions of MM(Modigliani Miller) approach?

Payback Period It is an amount of time, mainly measured in years; it takes previously the undiscounted cash inflows from a project equal the cash outflow. It indicates the leng

Historically, three types of shapes have been observed for the yield curve. The relative change in the yield for each treasury maturity is known as a