• Retirement scheme for unit trusts
• Kapuwa.Com
• Mind your Business
• The budget at last
• Lubricants market opens 
• SLT's listing hooked to world market stocks
• The cost of the war and its dubious benefits
• CIMA needs to take a higher profile on the International stage says Melvill
• Accounting policy for unit trusts to change
• SEC takes legal action against two fund managers
• Mumbai and Colombo alliance gets going
• Eygpt dampens Lankan hopes
• Captive sources buy in
• Right of reply
• Hutchison invests HK $ 1 billion in India 
• AA+ for good track record
• What is Enhanced Voice?
• Degrees through the internet 
• ISO 9001 for Bata
• Zeneca and Astra Merge 
• Namal returns exceed 12%
• Emirates Airline of the year 2000
• Airlines and forwarders abandon Cargo 2000 plan to beat integrators
• On your marks, get ready, steady…....... whoops! 
• What is Amadeus?
• Delmege opens first paint depot in Galle
• Plan demise no surprise 

Retirement scheme for unit trusts

In the midst of the uncertain macro economic environment and sluggish capital market conditions, the Unit Trust Association of Sri Lanka is seeking permission to launch a self finance retirement investment plan, modelled on the lines of Personal Equity Plan (PEP) schemes successfully implemented in Britain.

Under the proposed scheme, individuals would be allowed to save a limited sum of money for a year — for instance Rs. 100,000 — in 'qualified investments' which may include licenced unit trusts, provident funds and approved pension schemes etc for the purpose of retirement, the Association President, Dhirendra Abeyratna said. 

This investment should not be withdrawn until retirement and investors will be in a position to deduct the amount invested up to one third of their assessable income for tax purposes.

However, if they withdraw such investments before retirement, it should be taxed, unless it is re-invested within the same tax year, he explained. 

Abeyratna is optimistic that the scheme will spur public savings for future retirement and ease the burden of the state, thereby reducing future government social costs. 

The government would also be in a position to designate investment products, which support economic development as 'approved investment', with a view to encouraging their growth. 

"We believe this proposal would have a very sound, practical significance on the development of the country and the government would certainly look at it more favourably," he said.

The self financed retirement plan is part of the associations ambitious plan for this year.

The association is also lobbying the government to permit non-resident Sri Lankans and foreigners to invest in equity linked funds, thereby attracting Sri Lankan professionals residing abroad to participate in the local capital market.

In an attempt to channel 'black money' into the system, the association is renewing its call to permit them to issue bearer forms as unit certificates. 

The J A R Felix Commission for tax in 1998, highlighted that 'unaccounted funds' accounts for around 44 percent of the GDP. Abeyratna says that in today's terms this would amount to more than Rs. 300 bn of value addition a year.

"The unit trust bearer certificate would be an ideal instrument to channel such funds to the capital market, since equity funds on average invest more than 75 percent of net assets in the capital market," he said. 

He says, that the owners of such capital are high-risk takers in nature, who are willing to take reasonable risk levels for high returns.

"We believe the issue of bearer certificates would not have any monetary implications on the economy as it cannot become a negotiable instrument due to uncertainty of the underlying value of the certificate, which depends on market conditions."

Presently, bearer units are permitted in countries like Britain and Hong Kong.

The fund management companies will once again chip in to carry out a series of focused direct marketing campaigns to build on the successful media campaign launched last year. 

The association will co-ordinate activities with a view to create maximum impact and thereby obtain investor attention on new ways of saving for the future.

As part of its effort to boost the professionalism of the industry, investment counsellors will have to undergo a rigorous examination programme and obtain a certificate to sell unit trust products.

Abeyratne says the proposals are based on the premise that the unit trust industry has a very important role to play in channelling small savings for development, particularly in the background of the bleak prospects of a substantial inflow of foreign portfolio investment in the near term. 

The association believes that the revival and growth in the unit trust industry should be stimulated with the right policy measures, so that the capital market development would be focussed on indigenous resources rather than depend on external funds that are of a volatile nature.

Kapuwa.Com

I wish I may, I wish I might, I wish I had someone in my life! 

With that wish I look around, I look for someone to be around.

But I look and look, but I cannot find...

I cannot seem to find the one I like.

I've lost hope, I've lost time, but I look around one last time!

I look at the world one last time, the World Wide Web, keep in mind.

I type a few lines of my life and voila I enter a web site...

I look and look through all that I can find, and I found someone...

Found someone whom I think I like. 

Why does this, at least till the 'I look at the world one last time' sound extremely familiar. Well... I believe most of you know why. 

However, the fate that befell many a man in the 21-century rat race caught up with one of Sri Lanka's age-old occupations recently. This popular character has been replaced (literally speaking) by HTML code that when activated offer similar services and thanks to modern technology and its creators more. 

Best of all (don't tell anyone) 'no fees'!

Yes! The good old matchmaker, better known to us as the Kapu mahattya stepped out of the history books and got himself onto the world wide web to continue making matches in the millennium. 

Kapuwa.Com, the first Sri Lankan online singles web site, is the brainchild of Masters.Com, a company dedicated to provide web services and the creation of Netcontrollers. 

This 21-century matchmaker is enabled to offer a variety of services related to the institution of marriage including e-cards and poems and gifts for those who meet on line. In addition the Kapuwa.Com web site will have a constantly updated list of best selling romance novels and movies. 

A Masters.Com spokesperson said that Kapuwa.Com was aimed mainly at Sri Lankans over the age of 18 here and abroad. He said that the web site would provide individuals on the prowl and on the look out for a partner, a refreshing alternative to the newspaper marriage proposal columns. 

The spokesperson said that many Sri Lankans resident abroad prefer to marry a Sri Lankan and hence Masters.Com feels that Kapuwa.Com would be the ideal facilitator. Any person hoping to find someone will be required to fill out a form online, which would be processed and if everything seems to be alright published on the web site. 

Moreover, one could also browse through the list of people who have registered with the site. 

The spokesperson said that all information would be kept confidential, but that they could not vouch for the accuracy of information given by individuals on the site. 

The creators of Kapuwa.com hope that all those who are single and looking would look at the web for a partner in future.

Mind your Business

By Business Bug

Brand Trouble

A multi-national retailer has been faced with a peculiar problem lately after it decided it would do some market research in Sri Lanka. For years this consumer goods manufacturer had been selling several brand names - and doing quite well too. Now it has been revealed that the company's own products are competing with each other and that in fact it might be advantageous for rival retailers. Nevertheless, the multinational will not stop the practice of promoting several brands of the same product. Instead, it would be more cautious in pricing, ensuring that for a given price range there would be only one company product. 

Promises 

Remember how the greens promised to abolish GST if they came into power? The budget is now around the corner and some political pressure has been brought on the Treasury to consider this proposal- what with another poll around the corner.But the boys counting the rupees say the resultant loss in revenue will be too much to compensate for by other means. And anyway, the leading lady is not too keen to implement a promise made by her rival.

More unions

Banks are not the happiest of institutions these days,with one bank dragged into a conspiracy theory and another rocked by wars in the directorate.Nevertheless a section of employees in several private banks feel their interests are not best represented in the present day trade unions and there are several initiatives to set up an alternative trade union. This will not be music to the ears of the banks but the new union might see the light of day soon, they say.

The budget at last

The fifth budget of the People's Alliance government is to be presented on February 14th, four months after its due date.

The presentation of the budget in parliament was postponed at the eleventh hour to accommodate a hurried presidential election and was replaced by a Vote on Account. 

The expenditure estimates presented last November include increases in allocation for provincial councils, highways, finance, defence and plantations while a marked decrease in allocations has been experienced in agriculture, fisheries and the port sectors.

According to the Appropriation Bill presented in Parliament last November, despite heavy defence expenditure, the largest allocation increase of a mammoth Rs. 11 b has been made for provincial councils, the total figure being 34.8 billion. The highways allocation of Rs. 25.2 billion is an increase of Rs. 8 billion from last year. 

These allocation increases were much higher than the Rs. 5billion increase for defence which totalled to Rs. 52.3 billion for 2000.

The Vote on Account passed this December received allocations for the first three months of this year from the total allocations for 2000 under the Appropriation Bill passed last year.

Considerable allocations, according to the estimates have been made for finance (Rs. 6 bn), health (Rs. 4 b), port (Rs. 4 bn), plantations ( Rs. 4 bn), education (Rs. 2 bn), housing (Rs. 1.8 bn), power and energy (Rs. 1 bn) and Samurdhi ( Rs.1 bn).

Similarly, allocations have been considerably reduced as opposed to last year for agriculture 2 bn, fisheries 1.5 bn and port 1 bn sectors.

Allocation increases have also been extended to the science and technology sector(Rs. 230 mn), trade and commerce ( Rs. 159 mn) and labour ( Rs. 151 mn).

Marginal increases have also been made for industries (Rs. 34 mn), Buddhasasana (Rs. 19 mn) and women's affairs (Rs. 6 mn). 

Government allocations have plummeted in several sectors with tourism, Mahaweli and foreign affairs being two of the ministries to receive drastically reduced allocations. 

While tourism's allocation of Rs.1 billion was Rs. 876 mn less than last year, Mahaweli Development (Rs. 794 mn), foreign affairs (Rs. 696 mn) and livestock development (Rs. 625 mn) have also received less funds than the previous year.

Rural development, plan and cultural affairs have also received less than last year. Finance ministry sources confirmed that barring a few revisions, the budget would be almost the same planned for November 1999.

However, political sources confirmed that with the government intent on pushing the political package within a specific time frame and a general election scheduled afterwards, that the Appropriation Bill would include some 'election surprises' to keep the general populace happy. 

Meanwhile, more allocations are expected for Samurdhi in the supplementary estimates as the animators played a crucial role at the recently concluded election and are expected to do the same, for the general election.

The budget presentation on the14th would be made by Justice and Constitutional Affairs Minister and Deputy Minister of Finance Prof. G.L. Peiris. It will commence at 2pm. The debate for the Opposition is to be opened by MP Anura Bandaranaike and the closing remarks by former veteran finance minister Ronnie de Mel. The final reading of the budget is scheduled for 24th March.

Lubricants market opens 

Sri Lankan's will soon have eight brands of automotive lubricants to choose from, as six companies have signed up to supply the local lubricants market adding to the two existing brands. 

The memorandum of understanding between Caltex and the local government at the time of privatisation in 1995 and the Rs. 35 million licensing fee deterred many multi-national companies from coming. 

However, with the monopoly that was due to end in 1997,being finally lifted last year and the licensing fee brought down to Rs. 5 million. Companies like Exxon-Mobil, Castrol, Shell, Indian Oil Company, Valvolin, and British Petroleum signed up. Industry officials say that this would prove to be very beneficial to the consumer as the virtual monopoly is being replaced by virtually perfect competition. 

However, analysts say that Lanka Lubricants would continue to have a lions share of the market as the other companies have to sell at a marginally higher price. They said that this would however be the case, as the six companies had to pay a 10 percent import duty for the oils. 

Until recently the Rs. 1.6 billion monopoly was controlled by Lanka Lubricants Ltd. with brands like Lanka DS, Lanka Super DS and the Caltex range. Lanka Lubricants is also the only company that has a lubricant oil refining and manufacturing plant here. Texaco and Chevron, both American companies and the joint owners of Caltex Corporation have a 51 percent equity stake in the local venture after its privatisation in 1995. 

The company produces 40,000 metric tons of lubrication per annum. On the 

other,hand British Petroleum, one of the new entrants officially launched its range here last week through its newly appointed local distributor Associated Motorways Limited. 

Company officials said that Sri Lanka was the final piece of the puzzle to complete their presence in the Asian region. The company launched a very comprehensive range of oils that cover all applications. 

Exxon-Mobil on the other hand, has already started supplying the market with Automotive lubricants but has not officially launched its range yet. However, Mobil and Castrol have been in the market for sometime now with marine lubricants and other lubricating oils other than automotive lubricants. 

A spokesperson from McLarens Mobil (Pvt.) Ltd. (the Sri Lankan venture) said that Mobil was targeting the quality conscious market, which they estimate to be around 40,000 barrels our of the 175,000 barrel market. Meanwhile the other companies are expected to set up shop within course of the year. 

SLT's listing hooked to world market stocks

The overseas listing of Sri Lanka Telecom's (SLT) public offering will depend on world market conditions and the number of telecom stocks expected on the leading equity markets, a top SLT official said.

This preliminary assessment is needed since most funds tend to have a certain weightage for IT, telecom, insurance stocks etc. In the event a large number of telecom stocks coming into the market, the SLT issue may get lost among other issues. 

The lead manager selected for the initial public offering, will first do a meticulous study and then guide the government as to the best place for SLT's stocks to be listed and what percentage of stocks could be put on the market, SLT Chairman, Lalith de Mel said. 

He says that the government has kept an open mind and has not made a firm decision as to what percentage would be listed locally and overseas.

The lead manager would advice us on what percentage to list, he said.There is a perception that 10 percent is too small to attract the big fish. There are a few smaller telecom stocks on the market at the moment. Generally, smaller stocks tend to be not particularly attractive, medium stocks tend to be very attractive and very large issues are difficult to sell. 

"For a country like ours, we should really aim at the middle range and not too small, because sometimes a small one looks like a placement, it wont be a proper public offering in the true sense," he said.

The price of the issue will also play an important role, he said. "You can put a large amount of stocks on the market but it will depend on the price. The government is keeping an open mind about the price and no firm decision has been made yet," he said.

Equity analysts are presently estimating SLT's market capitalisation to be in the range of US$ 1 bn. Earlier, PERC officials said the government is willing to offer closer to 20 percent of SLT's issued share capital.

The government was initially hoping to raise between US$ 150 mn and US$ 250 mn from the IPO, but the dismal revenue targets for 2000 have prompted the government to pitch for about US$ 400-450 mn, PERC officials said.

The proposed IPO is expected around the first half of this year. The four prospective bidders shortlisted to lead manage the issue met officials of the Public Enterprise Reforms Commission(PERC) for the opening of the financial bids on Thursday. Preliminary ranking of technical and financial proposals revealed HSBC Investment Bank London (Plc) with the Merchant Bank of Sri Lanka had scored the highest, with Jardine Fleming Securities ranking a close second. National Development Bank with Solomon Smith Barney and Lehman Brothers Asia with CT Smith Stockbrokers followed in third and fourth place respectively.

In the preliminary ranking based on the technical and financial proposal, 80% of the marks had been allocated to the technical proposal and 20% to the financial proposal. PERC is expected to announce the successful lead manager next week when the evaluation is complete. 

SLT's much awaited IPO is billed as the biggest event for the local bourse, which is troubled by a modest Rs. 110 bn market capitalisation of 5% of GDP. The sheer magnitude of the issue has prompted the government to list nearly 80 percent of the issue on an overseas exchange as the Colombo bourse won't be able to handle the big issue. The issue is also expected to change the structure of the local all share price index. 

In other markets, when an issue of such magnitude comes aboard, the local exchanges run two parallel indices. In this case, since SLT would control around 1/3 of the market, there would be one ASPI with SLT and another ASPI without SLT, running parallel for a length of time until the market adjusts itself to the issue. The other option would be for the exchange to include SLT in the ASPI and with a lower weightage. The Colombo Stock Exchange officials said they are studying the matter and no firm decision has been made yet.

Japan's Nippon Telephone and Telegraph Corp (NTT) acquired a 35 percent stake in SLT for US$ 225 mn in 1997. While NTT has the management control, the government owns 61.5% and the employees 3.5%. Subsequently 0.2% of the employees sold their shares to NTT last year.

The cost of the war and its dubious benefits

The cost of our civil war is beyond es timation. There are direct and indirect costs, short term, long term and permanent costs. There are horrendous human costs on which no value can be placed. There are damages to our social and political fabric which cannot be estimated in financial terms. In the end there will be no winners, only losers. Despite all this we see no end to the conflict. We do not see even a serious approach to the problem. A consensus among the major parties is lacking. We go on bearing the costs of the war. Mr. Prabakaran's objective of carving out a separate state is not-viable politically and economically. Yet the war has to go on and the costs will continue to mount. 

Recognising fully the impossibility of estimating accurately the costs of the war, the Institute of Policy Studies (IPS) has attempted a broad approximation of the costs. The Institute admits that "any attempt to quantify the human and social costs would require subjective and questionable judgements". The objective of the exercise to put some numbers is to bring to the attention of everyone the enormous magnitude of the costs. The rationale for the exercise, in the words of the IPS, is that "an awareness of the magnitude of the costs can facilitate more informed decision making to be the direct protagonists". 

The IPS estimates the total cost of the war from 1984-1996 to be Rs. 1,168,603 million or 168 per cent of the 1996 GDP. It is significant that in this estimate the indirect costs are higher than the direct costs. If this estimate is made up to 1999, then it would indeed rise significantly. 

Further, the IPS study, quoted in its State of the Economy 1999, points out that the most obvious direct impact has been the sharp increase in defence expenditure, which absorbs the largest amount in the government budget and is "a relentless driver of the fiscal deficit". It points out that in 1998 the defence expenditure amounted two thirds of the fiscal deficit. The casualties of the war expenditure includes capital expenditure on infrastructure as well as social expenditures on health, among others. 

One of the biggest setbacks to the economy as a result of the war has been foreign direct investment. "The estimated cost of foregone investment flows amounts to a staggering 71 per cent of GDP in 1996", according to the IPS. 

May be our readers do not need any evidence to be convinced of the enormity of the costs. Yet such figures require to be placed before the public in order to appreciate what the country is undergoing. How can there be any meaningful economic growth and development when government expenditures are distorted and channelled to 'unproductive' areas; when private industry is denied resources; when foreign investment is dissuaded and the youth of the country is maimed and killed ? 

Let us turn to another perspective of the war expenditure which may be dubiously "beneficial" to the economy. These "benefits" are not overtly recognised yet has subtle intrusions into our economic evaluations. First, the economic growth rate we often look to as an indicator of economic performance includes a component of the war expenditure. A part of the growth in the services sector is attributable to war expenditure. Conventional economic statistics consider defence expenditure as "productive" and that there is a "value addition". Therefore let us note that the econmic growth rate we are accustomed to, includes the growth in military expenditure. The second important factor is that since about 7 per cent of GDP is spent on the war and a significant proportion of this is in wages, these expenditures are sent by soldiers to their dependents, mostly in the villages. Since most soldiers are from poorer households their wages are a source of income distribution. Third, and related fact is that the war has been a significant source of employment. So when we see reduced employment rates let us be mindful of the fact that foreign employment and employment in the forces are two factors bringing down the rate of unemployment. 

What we are attempting to convey to our readers is that not only is the real cost of the war enormous - even higher than the IPS estimate, and in fact unestimateable - but some of our economic indicators could be misleading as they show benefits owing to our expenditures. Therefore the war has on the one hand reduced our economic growth potential, while at the same time bloated our economic growth statistics, reduced our unemployment figures and improved our income distribution. These dubious benefits could of course have been achieved in a more substantial and sustainable manner had we not had the war. Yet the statistical result could be misleading. To put it bluntly, the economy is faring much worse than our statistics show.

CIMA needs to take a higher profile on the International stage says Melvill

By Dinali Goonawardene

STB: Sri Lankans pay more to do CIMA exams when there are cheaper local accountancy exams. What does CIMA have to offer?

DM: The CIMA qualification is unique. It provides a very broad based management education. Not only does it provide the necessary financial qualification but it also provides a basic understanding and knowledge of management. It allows the CIMA management accountant to play a much broader based role than some other accountants can. The skills and expertise can be translated into a number of job opportunities. Not all CIMA members work as financial directors. A number of them are CEO's. The broadbased qualification that a CIMA member has would stand him in good stead in the future.

STB: Students in the UK and overseas are charged the same fees for exams and membership. But the exchange rates make exams very expensive for local students. As an example it could be several months salary for Sri Lankan students while it may be one tenth the salary of a UK student. Has there been any attempt to review the fees charged from overseas students in view of the large number of overseas students?

DM: This is a question which is very relevant. At the moment the view of the institute's council is that it would not be appropriate to do that. One has to remember that CIMA is a worldwide organisation. The principles are that everyone must be treated universally the same. Of course the exchange rate at a particular point of time is adverse to the Sri Lankan student as it is to other Asian countries. Of course exchange rates do move over time. They go up as well as down and one of the things we decided to do in this situation is to be as fair and reasonable as we can, assisting students to meet these requirements. But the many reasons to actually introduce differentials to costs across the world would in effect give rise to differential performances which we don't actually feel is necessarily in the best interest in the long term. I recognise it's very hard at the present time and we need to do our best to try and alleviate the situation but I don't think the answer is actually differential subscriptions. 

STB: How would CIMA contribute towards the progress of individuals and the country?

DM: Well I think CIMA has demonstrated a track record of supporting individuals and the country. I think the first thing is that the CIMA qualification being a management qualification has produced many leaders of industry and commerce in your country. Just take a look at the number of CEO's and so many business people who are involved in CIMA at the present time. If you look at the CIMA council for example ... It's a great deal of experience. People who occupy high levels in business and commerce. As far as the individual is concerned it provides opportunity. Not only does it create the opportunity of becoming an accountant but creates the opportunity for that individual to have the goals for a management background. It makes them adaptable for any other qualification. 

STB: The role of the accountant appears to be changing. What role do you foresee for accountants in the future?

DM: The role appears to be changing but the demand and requirements of the skilled accountant are actually increasing. What you are actually seeing is accountants spreading their wings working much more closely with their business colleagues in the forefront of some of the business planning activities. Accountants may no longer be called accountants in the future. In the US for example they have coined the phrase business partners to reflect the accountants or financial managers working very closely with the operational managers in interrogating business results. So whilst you still see perhaps a smaller financial function in companies you probably see a broader financial information analysis function across the company.

STB: What facilities does the local division offer students and how does it compare with overseas branches?

DM: The Sri Lanka division has the largest building outside the UK. It provides a range of facilities and a range of training facilities. One of the things that I'm actually doing while I'm over here is discussing with the local membership how we might increase the facilities in the future.

STB: Can you elaborate on the proposals to increase the investment in Sri Lanka?

DM: At the moment we are in the design stage. Certainly it will include increasing lecture facilities and training facilities for students. The major investment will be on IT. CIMA is spending two million pounds on upgrading its IT systems. So the Sri Lankan investment will be linked to that.

STB: The stage four pass rate was 11 per cent in Sri Lanka and 12.4 per cent for overseas students. Why is the pass rate for overseas students sitting the fourth stage very low?

DM: Business English across the world needs to be improved. So there is an additional hurdle for international students. One of the things that we are looking at are programmes to overcome this particular issue. Understanding the problem is the very first step. Once you understand the problem you start developing solutions. That is the reason why overseas students have a problem initially with stage four. However when they do get through they are some of our most able and best qualified management accountants.

STB: The Sri Lankan pass rate for stage four was 11 per cent while the UK pass rate was 36.1 per cent. Why is there such a wide discrepancy?

DM: I think that is really what I've explained. It is not anything to do with the quality of the students. It is the natural tongue of the UK student and it is easier for him to express himself in English.

STB: How would the change in syllabus affect students and what benefits are expected from the change?

DM: The obvious change is in the final stage where there will be a case study. Students will have to demonstrate a basic understanding and analytical skills. Students will be able to plan their work and practical requirements. There will be far more scenario based questions which demonstrate the ability to understand and apply their knowledge in a scenario based situation. It will actually improve the quality and training overall for students and enhance the qualification.

STB: Do you consider the input of overseas stakeholders when reviewing the syllabus?

DM: Very much so. I mean stakeholders in CIMA are the membership, students, employers, very important employers. And we get substantial research across the world. So the answer to that one is a definite yes.

STB: How is CIMA helping foreign students adapt to changes in the syllabus?

DM: Partly by my being here in Sri Lanka this week. It's an example of that. We have for example flown in lecturers from around the world to a lecturers conference, trained, this is very important, senior managers throughout the overseas divisions are actually being involved in the discussion about how to implement the syllabus. I've come from Malaysia where I've been doing the same thing. You need to understand the particular issues that will arise in individual countries, which is what we are doing. We have already committed significant sums in terms of supporting students. Student support methodology you call it. We've been more flexible and more respondent to individual situations. So it's not just one thing its a whole range. It's a hands on approach 

STB: In some accounting exams work experience is compulsory in order to progress through each stage of the exam. CIMA does not have this requirement and is sometimes regarded as a more flexible less practical exam. There can be a gap between the time students spend studying and when they get their work experience. In view of this will there be any move to make work experience compulsory in order to sit the exam?

DM: One of the major strengths of the CIMA syllabus and the CIMA qualification is that it sports a determination for gaining knowledge while at the same time gaining practical experience..One of the big differences between us and other accountancy bodies is the emphasis that we place on practical experience. Ideally we would say that it was best to obtain the practical experience at the same time as you obtain the knowledge in which case you do both in parallel You do it in three years and become a member of the institute. Whereas if you had to do the examinations first and then obtain the practical experience afterwards it must take longer. Perhaps four, five maybe even six years. One of the things that I encourage is where the knowledge takes place first students should obtain some practical experience as they go through. One of the things you could look at is linking students, CIMA and individual employers. You could in fact look at making some practical experience become available. Apart from programmes for increasing student support practical experience is important and will remain a key part of the CIMA qualification.

STB: In the past there has been talk that CIMA would merge with the Association of Chartered Certified Accountants and the Institute of Chartered Accountants of England and Wales. Have these proposals been scrapped altogether or are there any new developments in this regard?

DM: Its very unlikely that there will be any further discussion on mergers in the foreseeable future. I think what has been proven by the various discussions that have taken place over the last few years is one, it would be very difficult to achieve. Two, that in fact the case for it is not as clear cut as it might seem to be on the surface. To have a successful merger its got to be in the interest of all the potential parties. Be it the students, members or whatever. And when you closely look at it this may not be the case. Thirdly, in the UK we already have the Consultative Committee for Accountancy Bodies (CCAB) In fact this should be the medium through which the accountancy bodies represents itself to industry, commerce and government. I think the truth is you don't actually have to be one body to speak with one voice on an issue of substance.

STB:Why did you choose CIMA as a career?

DM: I'll tell you why I did. Because I had a degree in management sciences at Warwick University I wanted to be in management. I wanted a degree in management. CIMA even in those days, many years ago had the broad flexibility of training on a professional level which complemented my academic training very very well. And in discussions with learned people, learned professors in those days, it just seemed to be the natural fit. I wanted also to start a career in business and industry and I was able to join my company which I'm still with today, at an early stage and train as a management accountant. At the end of the day it's a decision that I've never regretted. 

STB:What do you want to be remembered for at the end of your term as president of CIMA?

DM: A couple of things. In fact three. I've always been involved in education and training throughout my CIMA role. In fact as chairman of the education committee I was responsible for leading the development of this new syllabus. Now as president I'm responsible for the launch of it. So I want that to be a success. And I believe it will be a success. I believe it will take CIMA forward significantly in the years to come. Secondly, I am very concerned about the need for younger members getting involved in the institute. Members should get involved at a much younger age. So I would like to leave behind me initiatives to ensure that the institute is carried forward by younger members who actually reflect the age and the future development and who importantly know the sort of member service that they require. And which can be provided to the members at large. Thirdly, I think CIMA needs to take a higher profile on the international stage. I think business accountancy in general is under represented in discussions when we consider the issue of globalisation at the present time. And I would like to see that some of the steps that have been taken in the last twelve months would have raised the leadership role that CIMA has taken and other institutions have actually recognised that as well. 

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