The New Generation Of Banging Hardtechno

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Global head honchos of Ernst and Young are bullish on India's success story. Global Chairman & CEO, Ernst & Young, Jim Turley and COO, Ernst & Young,[link widoczny dla zalogowanych], John F Ferraro spoke about this on the sidelines of the Ernst & Young World Entrepreneur award ceremony in Monte Carlo.
Excerpts from an interview given to CNBC-TV18:
India story has been looking robust and stronger, you have been a frequent visitor to India but at this point in time, there are some concerns like the rupee is appreciating, interest rates are high and inflation is at about 6%, how strong is India story looking to you?
Turley: I still think its looking very strong, you saw great growth last quarter and the things like strong rupee, some concerns about inflation are really a result of great strong success and so, while there are always things to be concerned about,[link widoczny dla zalogowanych], I think the positives far outweigh the concerns.
You have been monitoring property prices in India?
Turley: The property prices have been going up dramatically, more in some sectors and geographies than others but I still think that is not holding back the economy. The strength, the entrepreneurship, the focus of the business community is very much on the positives and so it's a positive story still.
We were talking about the internal situation in India, but what about the external triggers and the external factors because everybody is worried about the Chinese economy and what's going to happen to it and the Chinese stock markets, your thoughts on that?
Ferraro: If one looks at the long-term, then China and India are real growth markets for the world economy and if you look at the India particularly, and you look at the private equity firms, they are now all setting up house in India. You look at the Indian companies that are investing outside of India, we just see robust opportunities in the future for both parts of the world.
What about the US economy and the concerns on the sub-prime market, have those concerns eased for the moment?
Turley: I think when you look around the world, corporate profits are in good shape, there are some concerns about valuations, like China being one but when one looks at the fundamentals, the profitability of companies and the level of innovation coming, I still think we are in for some good positive future.
At this point, there are some concerns because of the US presidential elections, the outsourcing outcry gaining momentum, also concerns on what's going to happen with H1-B visas, how much of an issue is that likely to be?
Turley: Every time there are presidential elections in the United States, there are is an element of the political environment - the talks about job placement and outsourcing of jobs. I think this cycle will be no different.
In many ways, whenever I am in India and speaking about this with business leaders, they say that more the discussion happens in United States,[link widoczny dla zalogowanych], the better it is for India because inevitably the story that is being told in the US is about the relative cost advantages in India, the relative talent advantage in India and so at the end of the day, it is actually benefiting India.
There is debate currently in India what companies should do with their annual shareholder reports,[link widoczny dla zalogowanych], what are your thoughts on this and what is the global trend that you are seeing at this point?
Ferraro: That is not a big debate unique only to India; it is all around the world and we have to work stronger on clearer, more transparent and more useful annual reports and in terms of it being a trend yet, I won't say it is a trend yet in terms of taking the dialogue into action.
Turley: I think it's going to be something that is going to be studied by a lot of different people from a lot of different perspectives,[link widoczny dla zalogowanych], not just the companies but also the investor groups, the regulators, firms like ours, etc.
It's really about great minds together thinking about what the future financial reporting should be because it has to be relevant and reliable and demonstrably what is there today may have been the right thing for a time that was less global, for a time where there was less technology and for a time less complex than today. I think you are going to see continuing dialogue and probably some experimentation towards reform.
And also some experimentation with quarter to quarter results and financial reporting that happens every quarter?
Turley: Not everybody around the world is on a quarterly reporting system. So, you are going to see some who have not been quarterly, move to quarterly. The technology is available if companies and regulators could arrange to report even more frequently.
I think getting the balance right between what the investors want, what information they need and how timely they need it, is going to be the real discussion taking place.
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