Media Release

2 February 2006

CFOs Support Move for a Simpler Regulatory System Cost/Benefit Analysis should be considered for any Changes

The Group of 100, which represents the CFOs of Australia’s leading enterprises, said today it supported any initiatives by the Federal Government directed at delivering a simpler, less complex regulatory system for Australian Business.

Commenting on an address to its members last night by The Hon Chris Pearce, Parliamentary Secretary to the Treasurer, the G100 said it endorsed the Government’s view that there was now a need to move the focus from the efficacy of regulation to that of efficiency in terms of finding the most cost effective and least onerous ways of achieving compliance across a plethora of regulation.

The G100 said the diversity of regulators, regulatory overlap between Federal and State regimes, the need on occasions for clarification of the role and responsibilities of regulators such as ASIC and APRA and the ongoing and highly important need to deliver clarity and certainty in respect to IFRS compliant interpretations of accounting standards were just some of the areas which needed to be addressed in any moves to improve efficiency.

The need also for Business to work closely with Government in a collaborative way was essential to achieving realistic outcomes, said Tony Reeves, National Executive Member of the G100, today.

“An important step in this process was the Government’s establishment of the Regulation Review Task Force. However, its effectiveness will be limited if it is a “’one off” response to current concerns. Instead, the Task Force should play an integral and ongoing role in the regulatory reform and review process and in this context allow adequate time for Business input and for the review and analysis process.

“From this review process the requirements and value of Regulation Impact Statements (RIS) will be significantly enhanced, we believe, if appropriate cost/benefit analysis were undertaken in respect to the various regulatory options to be considered.

“ Furthermore, before new regulation is passed, redundant legislation on the same subject should be reviewed and eliminated.

“The G100 noted with interest the Minister’s reference last night to a US view (from a senior advisor to the President’s Council of Economic Advisors) “that the best way to
improve regulation in the US was to continue to improve the cost/benefit analysis conducted by agencies in that country”.

“ The G100 supports that view.

“Finally, at a time in Australian business when a raft of corporate regulation and international accounting standards is now operative, the demands placed on the function and performance of CFOs has never been greater.

“ The pursuit of best practice in business processes and reporting will continue to be a major driver of the Group of 100 as it seeks to ensure Australian business delivers outcomes which contribute to developing an efficient regulatory regime that emphasises the overall competitiveness of Australia in the global context,” said Mr Reeves.

One important expression of this has been the development and introduction by the Group of 100 of a Code of Conduct for CFOs. The development of codes and stringent self-regulation were two key ways forward identified by the Minister last night in promoting efficiencies in regulation and the good conduct of companies.

Released by: The Group of 100 Secretariat

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