Treasury Today Country Profiles in association with Citi
Treasury Today November 2002 magazine Buy print copy button

November 2002

Previous editions

Editorial

It’s a tough job...but someone has to do it.

Corporate treasurers have a wide range of pressures on them all the time. In periods of economic uncertainty, however, the word ‘pressure’ takes on a whole new meaning. There can be benefits – for example, an increased profile within the company as the need to manage working capital and cash returns to the top of everyone’s agenda.

There is no doubt that now is a period of rare global economic uncertainty. Concerns about the possibility of war in Iraq, for example, affect European corporations, although some more than others. At the same time, more general concerns over counterparty credit have been exacerbated by a string of accounting scandals which, contrary to popular belief, have not all been in the United States.

Against this backdrop of economic uncertainty, corporate treasurers and finance directors also have to cope with a raft of new and expected changes to the European regulatory regime. These range from the proposed European prospectus directive to the need to prepare consolidated accounts in accordance with International Accounting Standards. The latter proposal has been complicated by the announcement that the International Accounting Standards Board and the US Financial Accounting Standards Board are committed to producing “real convergence between their respective accounting standards by 2005”.

Companies will also be affected by other market developments. There is a variety of proposals for creating a true single market in Europe. The introduction of the single currency is simply one piece in that jigsaw, albeit a very important piece. Other initiatives include those designed to develop a ‘Single European Payments Area’ (SEPA), although there are many vested interests to accommodate in the development of a SEPA.

In the long term, these developments should provide significant benefits to the European corporate treasurer. To realise them, you need to be aware, prepared and ready to exploit opportunities. And that’s where Treasury Today comes in.