PWC: Regulatory Compliance Top Concern in Financial Services

The outlook for U.S. financial industry competitiveness in the global marketplace, including recruiting talent, topped the concerns of nearly 400 senior financial executives in the third annual PricewaterhouseCoopers Finance Executives Forum survey. The competitiveness concern ranked only fifth in 2006, according to PWC, as executives cited the increasing cost, risk and burden of greater regulatory compliance. Regarding business performance issues, nearly one-third (32 percent) saw the need for simplifying financial reporting, while 26 percent cited “operationalizing risk management" and 22 percent saw the need for more systems integration. Nearly nine in 10 (88 percent) respondents favored a global set of financial-reporting standards, even though more than two-thirds (68 percent) are not prepared to give up established U.S. accounting standards. Also, the survey found that one in five executives believe the U.S. could fall into a recession this year, and 10 percent saw the housing market decline as their biggest challenge. Thirty percent said that they were concerned or extremely concerned about the adverse impact of subprime mortgage market issues.