IOSCO report on strengthening financial markets

  • IOSCO (International Organization of Securities Commissions) (dark gray) Image

05 Mar 2005

The Technical Committee of the International Organization of Securities Commissions (IOSCO) has published a Report on Strengthening Capital Markets Against Financial Fraud.

The report is based on a study of recent financial scandals involving large, global companies. IOSCO's goal is to identify possible weaknesses to the international financial system and decide how those weaknesses can be addressed. The report identifies seven separate areas that have figured prominently in many recent high-profile financial scandals:
  • Corporate governance, including the role of independent directors, protection of minority shareholders, auditor oversight, and conflicts of interest presented by related-party transactions;
  • Auditors and audit standards, including auditor independence and auditor rotation;
  • Issuer disclosure requirements, including management's discussion and analysis of material events and factors likely to have an impact on the issuer;
  • Bond market regulation and transparency, including issuer disclosures and the transparency of bond market price-setting mechanisms;
  • The role and obligations of market intermediaries;
  • The use of complex corporate structures and special purpose entities; and,
  • The analytical integrity and independence of private-sector information analysts.
For each of the seven areas, the report discusses what issues recent financial scandals have raised, and whether any international standards or principles currently exist to remedy or address the issues identified. IOSCO's stated priorities include promoting implementation of the international standards and principles already developed and facilitating cross-border enforcement cooperation so that existing securities laws and regulations can be fully enforced. Click to download:

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.