Steinhoff accountants too clever for themselves- functioning as a bank!!!
it would be interesting to see if PWC can infact add validity to the OBS and demonstrate benefit and legality.
Hopefully not that the OBS are all toxic assets which erodes value- probably not.
read the following which I though was rather interesting relating to OBS and banks- credit risk management
The off-balance sheet activities are in many instances part o the common business of banking , and not necessarily intended to avoid the regulations as argued by my friend Mo Chaudhury of McGill University, Canada : For example, lines of credit granted by the bank to its customers, the Letters of Credit in the international trade transactions and guarantees given therein by the banks to the exporters, any bank guarantees and contingency liabilities not booked in the balance sheets, the forward market transactions in currencies , and all other financial derivative transactions made often to hedge the risks in the balance sheets like interest rate risks .Many of the forward market transactions like buying and selling currencies are often to cater to the requirements of the customers for hedging their financial and business risks. They are all off-balance sheet activities meant to reduce the risks of the bank customers and of banks themselves in their banking books . If bank's rate sensitive assets are greater than rate sensitive liabilities, if interest rates decline in future , they are exposed to loss , and this can be hedged through an interest rate swap of paying the floating rate and receiving a fixed rate . Taking an interest rate swap is an example for an off-balance sheet activity. Having said all that positive activities, sometimes some banks indulge in speculative risk taking off-balance sheet activities also. However, regulators are trying to prevent that by even limiting the proprietary trade in financial markets by the banks directly and indirectly.....
I would guess SNH is guilty of management enrichment and the rest is noise.......
hope my noise is more interesting than the redundant media reports
