Latin American Capital Markets

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228 PIETRO MASCI AND IVAN SOTOMAYORadopting IAS mainly due to the lack of consistency in the application of the standardsand leniency of local regulatory enforcement of the standards.Is a quality control system for firms in the practice of accounting and auditingnecessary in Latin America and the Caribbean? A properly designed quality controlsystem, which adapts to the culture and local practices of each country, is a requirementif the country wants to achieve the following:• Raise the professional level of its professionals• Improve the quality of audits• Ensure that financial information is transparent, timely, and relevant• Provide international and national investors with information that is useful inmaking business and economic decisions• Reduce the cost of capital, which in turn will promote economic progressand innovation.The adoption of a quality control system by the individual countries would enforceconsistency in the application of the standard, which, if coupled with local regulatoryenforcement, would permit the comparison of financial statements prepared forthose enterprises in the countries that have adopted (AS or U.S. GAARTo implement quality in the preparation of financial statements, a country'ssystem of quality control must first create the enabling conditions and controls to assureintegrity of the system through consistent application of the standards, mandatorycontinued education, and independent supervision and enforcement of the system(see figure 7-2).In Latin America and the Caribbean, the accounting and professional practicerules are enacted under a diverse set of mechanisms, which makes harmonization inthe region difficult, but not impossible. Some countries enact the rules through thelegislative process, while others have delegated the process to the country's regulatorsand professional accounting organizations. For example, a country in CentralAmerica adopted IAS as its accounting standard and enacted it into law by authoritydelegated to the government accounting regulator A small, interested group of accountantschallenged the enactment on grounds of a constitutional technicality in theform of the enactment, rather than in the substance of the law. In an around-theproblemsolution, the government opted for giving autonomy to its regulators, theSuperintendent of Banks, the Securities Exchange Commission, and the InsuranceCommission, which require and enforce the use of IAS for financial statements filedby the agencies under their jurisdictions and represent approximately 90 percent ofCopyright © by the Inter-American Development Bank. All rights reserved.For more information visit our website: www.iadb.org/pub
Copyright © by the Inter-American Development Bank. All rights reserved.For more information visit our website: www.iadb.org/pubACCOUNTING AND AUDITING STANDARDS 229Figure 7-2I System of Quality Control for Audits
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Copyright © by the Inter-American
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FOCUS ON CAPITALNew Approaches to D
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ContentsForewordAcknowledgmentsAbou
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ForewordDuring the past two decades
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xFOCUS ON CAPITALlyst with Freddie
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ABOUTTHE AUTHORS xiiiDerek West is
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xviFOCUS ON CAPITALLocal capital ma
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xviiiFOCUS ON CAPITALTable IFinanci
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xxFOCUS ON CAPITALto investors to p
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xxii FOCUS ON CAPITALAlthough deriv
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4 KENROY DOWERS, FELIPE GOMEZ-ACEBO
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10 KENROY DOWERS, FELIPE GOMEZ-ACEB
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DEVELOPING A STRATEGY FOR REFORMING
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PART IIFACTORS AFFECTINGTHE DEVELOP
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•CHAPTER 2Globalization,Technolog
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GLOBALIZATION.TECHNOLOGY AND REGULA
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GLOBALIZATION.TECHNOLOGX AND REGULA
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GLOBALIZATION.TECHNOLOGY; AND REGUL
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GLOBALIZATION.TECHNOLOGY; AND REGUL
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GLOBALIZATION.TECHNOLOGY, AND REGUL
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•CHAPTER 3Internet Technology and
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INTERNETTECHNOLOGY AND THE DEVELOPM
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INTERNET TECHNOLOGY AND THE DEVELOP
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INTERNET TECHNOLOGY AND THE DEVELOP
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INTERNETTECHNOLOGY ANDTHE DEVELOPME
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CHAPTER 4The Impact of the Macroeco
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THE IMPACT OF THE MACROECONOMIC ENV
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CHAPTER 5Institutional Investorsand
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INSTITUTIONAL INVESTORS AND CAPITAL
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United KingdomPercentInsurance comp
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PART IIIISSUES IN THE IMPLEMENTATIO
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CHAPTER 6Promoting Regional Capital
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PROMOTING REGIONAL CAPITAL MARKET I
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Page 203 and 204: PROMOTING REGIONAL CAPITAL MARKET I
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DEMUTUALIZATION OF EXCHANGES 279is
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DEMUTUALIZATION OF EXCHANGES 281tha
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DEMUTUALIZATION OF EXCHANGES 283sec
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DEMUTUALIZATION OF EXCHANGES 285the
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DEMUTUALIZATION OF EXCHANGES 287cro
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DEMUTUALIZATION OF EXCHANGES 289Ams
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DEMUTUALIZATION OF EXCHANGES 291to
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DEMUTUALIZATION OF EXCHANGES 293Kah
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CHAPTER 10Developing Bond Markets:A
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DEVELOPING BOND MARKETS: A COMPREHE
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322 CLEMENTE DELVALLEare generally
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•CHAPTER 11Designing a Derivative
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DESIGNING A DERIVATIVES COMPLEMENT
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DESIGNING A DERIVATIVES COMPLEMENTT
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•CHAPTER 12Access to Financing fo
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ACCESS TO FINANCING FOR SMALL AND M
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•CHAPTER 13Developing Capital Mar
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DEVELOPING CAPITAL MARKETS—ETHICA
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DEVELOPING CAPITAL MARKETS-ETHICAL
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•CHAPTER 14Corporate Governancean
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CORPORATE GOVERNANCE AND CAPITAL MA
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The company's historyof equitable t
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CHAPTER 15Human Capacity Developmen
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HUMAN CAPACITY DEVELOPMENT 465For t
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HUMAN CAPACITY DEVELOPMENT 467• W
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HUMAN CAPACITY DEVELOPMENT 469spect
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HUMAN CAPACITY DEVELOPMENT 471Table
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HUMAN CAPACITY DEVELOPMENT 479struc
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HUMAN CAPACITY DEVELOPMENT 481rapid
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HUMAN CAPACITY DEVELOPMENT 483tate
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PART IVCONCLUSIONCopyright © by th
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CHAPTER 16Pragmatic Issues in Capit
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PRAGMATIC ISSUES IN CAPITAL MARKET
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IndexIn this index, page numbers in
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INDEX 519Bolsa de Valores de Rio de
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INDEX 521Clearing and Depository Co
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INDEX 523costs, financial services
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INDEX 525developing economies (cont
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INDEX 527European Central Securitie
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INDEX 529Global Equity Market (GEM)
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INDEX 531institutional investorsbon
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INDEX 533Jensen, Michael, 216job cr
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INDEX 535margin requirements, 322,
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INDEX 537outsourcing and infrastruc
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INDEX 539prudent investor rule, 141
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INDEX 541Securities and Exchange Co
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INDEX 543technology (continued)self
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Copyright © by the Inter-American
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