derived from the european framework of harmonized legislation, from 2005 onwards listed companies, and banks and financial corporations will have to draw up their financial statements in compliance with the international accounting standards. in italy the process of adapting our legislation, including civil and tax law, is under way. the new capital accord for banks known as basel 2 will entail changes in the way financial statements are presented. it will come into force between the end of 2006 and beginning of 2007 and will introduce more efficient methods of defining the capital employed to hedge different types of risk that reflect the best business practices at international level. i affirm once again that, on the basis of existing studies, we do not expect there to be adverse effects on corporate financing, particularly of small and medium - sized firms. in fact the adoption of the new system will certainly encourage banks to become more efficient, improve their ability to assess creditworthiness, and better satisfy the needs of the business sector. at the same time firms must provide banks with exhaustive information about their assets and revenues, and the structure and scope of their activities at home and abroad. all this indicates that accountants will be expected to perform an increasingly important role, and highlights the advisory nature of their work and its contribution to dynamism. they must always be guided by ethics and professionalism. * * * a joint effort is needed, based on a climate of complete trust and cooperation between firms, banks and institutions, to help lay the foundations for economic recovery, foster a reversal of the current trend, and encourage new models of growth to emerge in southern italy as well. the people, the intelligence, the savings and the business ability to do so are all present. i wish to thank you once again and wish you pleasure and success in the performance of your work.

the introduction of new technologies. 3. today ’ s guests include auditors and accountants. members of these professions perform a complex task with great responsibilities. i have often stressed that accounting rules are indispensable in order to know and certify the truthfulness of economic and administrative facts, which are a fundamental aspect of the organization of society. the whole of civil life could not function in fact if people did not tell each other the truth. in summa theologiae thomas aquinas said that truth was one of the values underlying social coexistence. the same holds for the economy and business, which must rest on an order made up of relationships and rules that include accounting standards. in italy great masters laid the foundations of the art of accounting. in the fifteenth century luca pacioli, adopting the practices long in use among venetian merchants, developed the theory of “ double entry ” bookkeeping goethe called “ one of the most wonderful discoveries of the human mind ”. fabio besta arranged these studies on a scientific basis, perfecting the tools available to make correct entries. these are the solid foundations on which we now work. as a consequence of the function they perform, accountants are expected to show professional autonomy, independence of judgement, and constant dedication, vis - a - vis clients, to transparency and honesty. members of the profession now face new duties ; they must cope with all the forthcoming changes in the methods of accounting for corporate facts ; they must keep constantly abreast of developments and study the innovations in company and fiscal matters. the recent financial difficulties of several industrial firms have highlighted the crucial role of internal controls and of external audits to verify that accounts are properly kept, that transactions are correctly recorded, and that the financial statements conform with the book entries and the rules for valuing assets and liabilities and recording corporate facts. the bankruptcy laws are in urgent need of reform, which is now under study, to shorten procedures, offer greater certainty and broaden the scope for mutually agreed solutions and the survival of worthwhile economic projects in temporary difficulty. firms, banks and the economy will benefit. in the financial sector, reliable judgements and proper conduct are equally important. intermediaries are required to assess fully all the risks of their clients ’ investment decisions and present them clearly. 4. the discipline of accounting is undergoing far - reaching review at the moment in response to the demand for standardization stemming from the growing international openness of our economies. according to the principles