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Regulatory changes brought in by the FSA, the EU, and from the US through the
Sarbanes Oxley Act during the last five years have brought about few noticeable
benefits, a survey by Ernst & Young has found.
The report, "Challenges Costs and Future Expectations", claims financial
services companies remained unconvinced of the benefits of the new rules.
Ernst & Young estimate that as much as 5% of profit before tax of the 30 leading
financial institutions surveyed in the study is spent on risk management.
For the largest companies, this is in excess of £100 milion each per annum.
Dr Stephen Christie, head of the financial services risk & regulatory practice,
at E&Y explained: "The operating models currently in place for risk and
compliance across many organizations, evolved in response to twentieth century
regulations.
"The pace and complexity of change in the twenty-first century is beginning to
highlight significant shortcomings in these models".
Source:
Credit
Control Journal
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