A bank or fund is usually the sum total of several business lines. Each of these business lines has an associated risk to its assets that Basel II wishes to label Beta or Gamma. The total risk exposure can be summed as the total of the risk-weighted assets. Thus, best practice in one department does [...]
The credit raters are not to blame as such; they only review the data and aspects of a company presented. It is a consensual process, in that the agencies do not barge in uninvited, nor do they pay surprise visits. The company visited pays for the inspection, or it may have been requested and funded [...]
Credit ratings are just one of the benchmarks of banking and fund management industrial standards. They are a good attempt to protect against potentially wayward performance in the financial markets, but they represent only one technique. They provide a short single figure or code e.g. AA, B The research figures distilled into one succinct summary [...]
International accounting standards (IAS) or the latest US GAAP (generally accepted accounting principles) accounting guidelines will reform the auditing world in the post-AEW investment climate. The revised accounting drafts are of major relevance to banks, funds, insurers and all types of corporation. In particular, the latest IAS 39 and FAS 133 spell major revisions for [...]