It is
human nature to take things for granted and lose perspective when
things are moving smoothly. It is only when things move away from
this golden mean that we often wake up and realise the loss of the
equilibrium which we took for granted. It is very much like our
health, freedom and the air we breathe, whose absence we realise
only when they are lost or unavailable. Such a rude awakening came
with the recent events relating to the bankruptcy of Enron Corporation
in the USA, which has had a direct impact on the accounting and
auditing profession at large. This unfortunate episode has once
again emphasised the two basic tenets of auditing namely independence
or "arms length distance" and that "a true and fair
view" should be just that, true and fair. Violation of either
of these two commandments could have drastic consequences as it
has once again been proved. As a direct consequence of this incident,
regulatory authorities are again examining the auditing standards
adopted by firms world wide and particularly the ethical issues
arising out of a firm providing both consulting and audit services
to the same client. This, I believe, will also lead to closer monitoring
of the activities of audit firms.
On a positive note, the Dubai International Financial
Centre (DIFC) was set up. True to the tradition of Dubai of being
a trendsetter in the region, General Sheikh Mohammed bin Rashid
Al Maktoum, Crown Prince of the emirate, said that the DIFC will
be a "bridge between financial markets of the East and the
West". The DIFC, acting as a gateway for the flow of capital
to and from the region, will strengthen links to international capital
markets and will fill a void in the financial service infrastructure.
The DIFC is expected to provide round the clock financial services
and will be equipped with a world-class infrastructure. The DIFC
will also have its own regional electronic stock exchange and is
expected to fill the long awaited window of opportunity for banks
and financial institutions. We believe that the DIFC will be a pioneer
of financial services in the region.
In this issue, it is our honour to have H.E.Mohammed
Omar Abdullah, Director General of Abu Dhabi Chamber of Commerce
and Industry (ADCCI), as our guest columnist. In his article he
discusses the role played by ADCCI in the Emirate's economic development.
We wish ADCCI the very best in all its future endeavours and, we
at PKF shall be privileged to be partners in its progress.
For those of us who are from the sub-continent,
home is not so far away. But how does a person who hails from "down
under", New Zealand, feel about the UAE? We had the opportunity
of interviewing Mr. Colin Gorton, General Manager of Enzed Trading
LLC and Fleximak Ltd., Jebel Ali. He shared with us his views on
the company he manages and the UAE. This issue of PKF update also
features an interesting article by Mr. Stephen O'Brien, on managing
succession in family businesses. I believe the article is extremely
relevant for this part of the world. I hope you enjoy reading it
as much as I did. Another interesting article on Employee Stock
Option Plans (ESOP) by our Director Mr. Ravi Chitnis and Ms. Ritika
Gupta, consultant, features in this issue. It examines various aspects
of ESOP and whilst still in its infancy here in the region, is one
of the motivating tools in the West. With the closing of the Dubai
Shopping Festival and the advent of April, winter is truly over.
We now look forward to a few more months of work before we earn
a well-deserved break in the summer.
