Posts Tagged ‘financial results’

Dubai Shakeout Leaves Thousand of Indian Families Worried

Dubai Debt Fallout Leaves Thousand of Indian Families Worried

The $59-billion debt woes of state-run Dubai World, one of the largest global conglomerates, has left thousands of Indian families worried, as the region accounts for half of the country’s $25-billion remittances.

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Gulf countries employ five million Indians, out of the 25 million total strength of the Indian diaspora in 130 countries, and Dubai being a key driver of the region’s economy, a shakeout there is seen unsettling the job market — and the incomes of relatives.

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Market experts have expressed that there will be at least 25-percent contraction in the job market and there may be a ripple effect on most Middle East countries because of Dubai World bust.

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They also said that Middle East meltdown is not a last month generated phenomena  rather it has been there for the past one year.

Infact, people have been coming back to India for the past one year.

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Market experts and policy makers have expressed concern over the prospect of Indians employed in the Gulf losing their jobs.

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However they insist that much would depend on Dubai world Bust’s impact on the real economy there and employment.

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Many relatives of Indian expatriates in the Gulf have expressed concern and worries over the prospect of the loss of jobs in Gulf  in the wake of Dubai World Fiasco !!

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Many of families have taken huge amount of home loans to construct houses or to buy flats.

(With the dependence of paying it through the remittances they generally receive from their relatives working in Gulf).

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Now, they have worries like if their close family member working in Gulf loses the job then it will get impossible to repay the loan amount in full.

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In Andhra Pradesh, which accounts for the largest share of remittances from the Gulf after Kerala, the realty industry feel there is an underlying worry that the Dubai World episode may just be the tip of the iceberg.

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Experts over there feel that things might go from bad to worse when the Dubai companies announce their financial results in December and January and many more could lose jobs.

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Analysts, nevertheless, maintained that while the future plans of Dubai World in India may be affected, the existing ones may not suffer much.

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SEBI Proposes New Recommendations on “Audit & Accounting Standards”:)

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An expert panel of Securities and Exchange Board of India has proposed disclosure of audited balance sheet on a half-yearly basis by listed companies.

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At present, a listed company discloses audited accounts once a year at the annual general meeting.

This is among a slew of recommendations made by the Sebi committee on disclosure and accounting standards (Scoda).

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“The accounting irregularities at Satyam Computer Services reiterate the need for having greater internal checks and controls in an organisation,” the Sebi committee said in a discussion paper put out on Monday inviting public comments till September 25.

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Sebi will take a final decision on the new disclosure norms proposed by the committee after getting public comments.

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Pinning the responsibility of ensuring the independence of the external auditor and its partners on the audit committee of the company, Scoda has also proposed that the partner of the audit firm of a listed firm be rotated every five years to avoid management-auditor connivance.

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Citing scope for improvements in accounting norms, following the Satyam Computer scam, Sebi had asked Scoda to look into the possibility of carrying out internal checks and balances in firms by external auditors.

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Sebi panel proposals are expected to bring transparency in the corporate governance.

It is expected to lift the corporate governance standards in the country.

The need to upgrade standards was felt since the Satyam scam hit the market.

The guideline to rotate auditors after every five years is welcomed decision.

The decision to ask listed companies to report audited results twice a year may also lift investors’ confidence in the markets” said Jagannadham Thunuguntla, head of research at SMC Capital.

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Another issue, which Scoda felt may best remain unchanged is prescribing professional qualifications or financial literacy for chief executive officers and chief financial officers of companies.

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The committee suggested that the responsibility of selecting CFOs with adequate qualification be given to the audit committees of companies.

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The Scoda was of the view that the appointment of CFO should be approved by the audit committee, which while doing so shall be required to assess the qualifications, experience and background,” it said.

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Further, in order to prepare India Inc to adopt International Financial Reporting Standards (IFRS) that are expected to take effect from financial year 2011, Sebi had asked the committee to look into the possibility of allowing companies to voluntarily implement the practice.

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The committee has also proposed a uniform timeline for submission of financial results by listed entities.

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It has put forward that listed entities shall be required to submit their quarterly and year-to-date audited and standalone financial results or quarterly and year-to-date unaudited standalone results accompanied by limited review report of the auditor within 45 days from the end of the quarter.

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This is applicable to all quarters except the last one.

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