Citibank and insider trading

A good day for Citibank; turns out that the Supreme Court did not think they were breaching 'Chinese Walls' with respect to their advice to, and trading on, Toll Holding during their takeover bid for Patrick: see SMH link here.

ASIC can't be happy about this. We'll see what their new Chairman, Tony D'Alosio does in response to this.

Disclosure, disclosure, disclosure

Stuart Wilson in The Australian points out that sometimes too much disclosure is required of our listed companies; in this case when a rights issue is on the table. A substantial volume of information is required to be disclosed, but none of it is likely to be new or price sensitive. Given that existing shareholders are the only ones able to participate in these sorts of rights issues, it would seem sensible to reduce the required disclosures.

Medical certificates for all!!

Hey, now this is a surprise. Apparently some doctors sign lots of medical certificates for uni students. Noooo, say it ain't so, doc. SMH story here.

That's why we're suspicious, students. Tip: don't turn up for the exam, and then lodge a Special Consideration form.

Present value tables

While I remember, you can download present and future value tables from this link.

Disclosure of Corporate Governance Practices

Are they or aren't they? Two reports on ASX-listed companies' Corporate Governance Disclosure Practices: one says it's all ok, the other, not so.

See The Australian 14 June 2007. Note that this is in the leadup to revised ASX corporate governance principles.

It's important to recognise that not all companies need the same corporate governance mechanisms, and that this should be reflected in what they disclose (i.e., a "one size fits all" approach is not likely to be optimal). A harder question to answer is 'does corporate governance matter?'. Folks over at Wharton have had a good look, and find that corporate governance is more likely to be related to future than current accounting (and stock market) performance. Link (pdf file)

SOX and cost of capital

Jeremy Grant in The Australian writes:

ALMOST three-quarters of the chief financial officers in the US believe that Sarbanes-Oxley should be "repealed or reformed" as the costs of the 2002 compliance law have outweighed the benefits, according to a survey.

The findings underscore the scale of frustration over the costs associated with implementing "Sarbox", even as regulators said that costs were expected to fall as new guidelines for the law were finalised.

In a survey of 484 chief financial officers by Duke University and CFO Magazine, almost 70 per cent said the costs of adhering to Sarbox requirements - principally its section 404 provisions on checking internal controls - "greatly outweigh its benefits".

Well, it might not all be bad. There's at least some research out there that purports to show that effective internal controls are associated with cheaper capital.

First test post

Let's see if this works. Text here.