We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
Published online by Cambridge University Press: 03 December 2009
Evolution of FSA's approach
FSA's current approach to firms' infrastructure is a hybrid development from both banking and securities regulation. The former started with the 1987 Banking Act under which the licensed bank had to ‘conduct its business in a prudent manner’ and, for this purpose, ‘maintain … adequate systems of control … to enable the business to be prudently managed and comply with the duties imposed … under this Act’ and the Bank of England, as supervisor, had to ‘publish … a statement of the principles in accordance with which it is acting … in interpreting the[se] criteria’. Initially the Bank stated that ‘considerations include … management arrangements; … general strategy and objectives; planning arrangements; policies on accounting, lending and other exposures … and recruitment arrangements and training to ensure that the institution has … experienced and skilled staff … to carry out its activities in a prudent manner’.
However, by the mid-1990's, ‘internal control systems should provide reasonable assurance that:
(a) the business is planned and conducted in an orderly and prudent manner in adherence to established policies;
(b) transactions and commitments are entered into in accordance with management's … authority;
(c) management is able to safeguard the assets and control the liabilities of the business …
(d) the … records of the business provide complete, adequate and timely information;
(e) management is able to monitor on a regular and timely basis … the adequacy of … capital, liquidity [and] profitability …
(f) management is able to identify, regularly assess and … quantify … risks.
To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.
Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.
Find out more about the Kindle Personal Document Service.
To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.
To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.
