Getting global markets off their knees

…better financial reporting, through graphs, statistics and numerical reporting can help prevent meltdown accelerating

Global financial markets are on their knees today because accurate reporting is so poor and often dishonest at so many institutions.

It has brought down global giants, Enron and Andersen’s are just two examples, of a steadily growing pile of corporate monoliths that have hit the dirt with employees, shareholders and investor funds in a big way in recent times.

“A story lies behind every graph or statistic, and very often that story disguises a lie. Every financial analyst who has read an annual report, or had to submit graphs to shareholders, journalists or staff knows how information can be manipulated by the way a graph, statistic or aspect of numerical reporting is presented,” Liza van Wyk, CEO of business support and administrative training organisation BizTech says.

Van Wyk said: “The global financial crisis is highlighting the importance of everyone cleaning up their act, it can no longer be business the same unless we want economies to crash and thousands to lose their homes and jobs, no one wants to repeat the Great Depression of the 1920s.”

She said that the introduction of Graphs Statistics and Numeric Reporting, a few weeks back, “was serendipity. We are seeing people rush to sign up for the course, we think people have realised how critical it is to present accurate information. And yes, we also tell how bad information can be massaged, but most of all we focus on best practice accurate reporting. There is a far greater emphasis on ethical business practice today and far closer scrutiny.”

In Britain, The Committee on Standards in Public Life, which was established in 1994, carried out research indicating that most people believe that officials in business or government are unlikely to tell the truth or to admit to their mistakes. It said that, “To most people, a reluctance to be open means that someone has something to hide. It represents a problem for all public authorities because it leads to the perception that people should be sceptical about what they are being told. As a result the public becomes less likely to follow advice or to believe good news when it's reported.

The opposite is also the case: if an authority does not try to conceal information, but tries to explain what it may regard as an uncomfortable truth, it is far more likely to be trusted.”

Good information = top share prices

Van Wyk says too, “that it is a well-known fact that the quality of financial information, including graphs and statistics has a direct impact on how highly the investor community and stock market values a company or commodity.

“Equity analysts hate surprises, so the more credible financial information is, the more significant investor returns for an organisation.

“If we look at those companies that present information to the media, any company that has strong visuals, especially compelling graphs or statistics to accompany information, will always get better use.”

Economic experts are warning that the thawing of the credit markets after massive cash injections by governments in Europe and the USA will be a relatively slow process. It will take time before the benefits reach many businesses and consumers, they say.

"Banks are still going to be a little hesitant about lending, particularly to borrowers with lower credit ratings. My hunch is the economy will come back faster than we think it might, but it's still something that'll likely takes months, perhaps a year," said William Isaac, a former chairman of the Federal Deposit Insurance Corp.

“The need then, to have absolutely up-to-date information about your company presented in an easy to understand, visual way to add power to statistics and reporting, has never before been more critical,” Van Wyk said.

“Banks are going to hesitate far longer and be far more cautious about lending the necessary money to power companies forward. In these cautious times presentation becomes critical,” Van Wyk said.

BizTech is already taking bookings for Graphs Statistics and Numeric Reporting and other courses for next year.

FOR FURTHER INFORMATION CONTACT:

LIZA VAN WYK, CEO, BIZTECH 082 466 8975 or 0861 249 8324 or liza@biztech.co.za www.biztech.co.za

Issued by MediaOnLine mediaonline@global.co.za or 011 646 7637