Governance Regulations Among Australia, South Africa, and United Kingdom

1235 Words Feb 12th, 2011 5 Pages
Business conditions and regulatory initiatives have resulted in a variety of codes and regulations to meet the needs of local capital markets[i]. For instance, in the United States, several major corporate and accounting scandals such as those perpetrated by Enron, WorldCom, Tyco International, and Adelphia communications resulted in the enactment of laws and rules to restore and maintain confidence in the financial markets. Other nations experienced similar situations and enacted rules and regulations to promote consumers and investors’ confidence in the financial market. This paper examined the major events that led to the enactment of corporate governance regulations in Australia, South Africa, and the United Kingdom (UK). And analyzed …show more content…
The committee also presents the reasons for the absence of internal audit function in its annual report10. The chief executive officer and the chief financial officer are required to certify annual/quarterly financial reports and provide assurance for the effectiveness of internal controls[iv]. For example, the Combined Code in the UK stipulates that the board should conduct a review of the effectiveness of the group’s internal control system at least annually and report to shareholders.

• Enhance Independence and Objectivity: Measures to enhance the independence of audit committees and their effectiveness[v]. For instance, in South Africa, the chairperson of the audit committee is expected to be an independent non-executive director and not the chairperson of the board. However, the chairperson of the board could be invited to attend meetings as needed by the chairperson of the audit committee3.

• Effective Financial Reporting: Rules requiring disclosure of off-balance sheet transactions and use of pro forma financial information. Also a requirement for real-time disclosure of material changes in the financial condition/operations of public companies[vi]. For example, companies in Australia are required to implement mechanisms that will ensure compliance with the ASX Listing Rule requirements; this is to allow investors to gain access to listed company’s material information (e.g., company performance,
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