Archive for August 1st, 2017

The role of accountants in the process of economic development

August 1, 2017

Interesting speech by Mr Rameswurlall Basant Roi, Governor, Bank of Mauritius.

You rarely see a central banker speak about role of accountants and auditors. He says role of accountants as auditors is as crucial as any.

Thank you for having invited me to speak to an audience of accountants. It’s a first for me. On the occasion of this Forum organized by the Mauritius Institute of Professional Accountants (MIPA), it’s my pleasure to share with you some of my thoughts on the role of accountants in the process of economic development.  Let me at the very outset stress that contributions of accountants to the process of economic development are generally not direct. But their services as external auditors of financial institutions make direct contributions to the efficient functioning of financial markets which, in turn, allocate scarce resources to economic sectors and facilitate the process of economic development.

It is not just about importance of accountants but even importance accounting. Knowledge of basic accounting is really useful in economics to understand balance sheets and flow of funds. But the econ profession hardly pays any attention to teaching these basics.

PS.

It is even more ironical to see how Finance and Accounts professions have diverged in academia over the years. The Finance professors say they don’t know accounting and Accounting professor says they don’t know finance! We are just building more and more silos..

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Why the quest for a single currency for West Africa won’t materialise soon

August 1, 2017

Interesting piece by Prof. Tahiru Azaaviele Liedong of University of Bath. One would imagine most monetary union projects would be stalled seeing the case of Europe, but not really.

Apparently there are 15 West African countries which want to form a monetary union. Of these 15, 8 are French colonies, 5 English and two are Portuguese. Of the 8 French colonies, 7 are already in a monetary union along with one of the Portuguese speaking nations (Guinea-Bissau). Their common currency is CFA Franc.

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New road infrastructure in UK: The effects on firms

August 1, 2017

It is always tricky to do such studies. Does road connectivity lead to firm agglomeration and more productivity? Or do roads eventually get built in higher productivity places?

A team of researchers Steve Gibbons, Henry Overman, Teemu Lyytikainen, Rosa Sanchis-Guarner try and see impact of new roads on firms:

Why can’t the Government/RBI appoint Deputy Governors in time?

August 1, 2017

It has become a habit of late to keep key positions at RBI empty despite knowing the positions are going to be vacant due to retirement/rotation.

As big decisions like demonetisation were implemented with three Deputy Governors  and most Board positions being empty. We learnt later that of the three Deputy Governors, just two were present in the meeting.

Now, it has been known that one of the Deputy Governors-S.S. Mundhra- is going to retire on 31 July 2017. RBI even released an advertisement for the position which is a good practice compared to previous appointments whose process was not really known.  The ad was released on 24 May 2017, so there was ample time as well. Though, the open ad created controversy as there were allegations that RBI intends to appoint a banker from the private sector.

We were also told about people in the fray but they were to be interviewed on 29 July which was really close to the date of retirement of Mr Mundhra.

As there was no decision by 31 July or it was delayed, RBI had to shift responsibilities between the 3 DGs.Mr Mundhra handled following tasks:

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