Quotes of the year must have some essential qualities. They must be routed in reality. They must encapsulate a moment. They must have inherent in tem a demand for action. Hopefully they’re elegant, pithy, pertinent and prescient all at the same time.
The following from Steve Hadrill, new head of the UK’s Financial reporting Council responsible for regulating auditors fails on elegance. It also needs contextual setting so it is not pithy. But it’s good on the other two. In December 2009 he said, when speaking about whether a fifth large firm of auditors was needed:
[T]he priority for us has to be that we are prepared for the worst and that is where I will put my focus
Blow creating a fifth firm in other words, making sure we keep four is going to be tough enough in his view, and mine.
The prescience? Threefold, I suggest: first, failure of one of the Big 4 is inevitable; second, he has no idea what will happen if they do and third we’re setting ourselves up for another ‘too big to fail’ scenario. As the pillars of our current version of capitalism collapse all around us all we seem able to do is prop them up until like dominoes they’ll fall again.
It’s not encouraging. And it shows, time and again, that the wrong people are in the regulatory jobs.
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Richard
As you are collecting quotes of the year, and tax is likley to have a high profile next year, may I submit the following food for thought?
“It seems natural to now question why debt finance should be subsidised, particularly if it not only costs tax revenue but also increases risks of the government using taxpayers’ money to deal with the impacts of higher leverage in the banking sector.” David Miles, member of the Bank of England’s montary policy commitee, 16 Dec 2009, see: http://www.bankofengland.co.uk/publications/speeches/2009/speech418.pdf
or:
“We’re not saying tax was the cause of the crisis [but] we do see some tax fingerprints at the scene of the crime,” said Michael Keen, assistant director of tax policy at the IMF’s fiscal affairs department, see FT 16 June 2009.
Best wishes to all for 2010 and a happy, healthy, and (dare I say it) prosperous new year.