goes : “ to those whom much is given, much is expected. ” as trainees and newly qualified chartered accountants many of you have had the benefit of good schooling and tertiary education. you have further benefitted from the investment in you and opportunities created for you by this society. this privilege imposes upon you a moral obligation to plough back into both your immediate communities and our society at large by ensuring that you adhere to and promote the high ethical and professional standards of your profession. it is in this context that it is appropriate that members and aspiring members of the profession respond positively to the call of public service and that members do not only become service providers to the private sector, but that they also join the ranks of the public service in order to address the shortage of skills within that sector. in this context they have much to contribute to root out corruption, design monitoring and early warning systems so as to ensure improved service delivery, institute controls that would minimise instances of wasteful and fruitless expenditure, design reports so that politicians and officials have access to accurate and timely information and which should contribute to improved decision - making and policy outcomes. i wish to encourage members to think critically and to help shape the regulatory landscape, both locally and domestically, and to actively contribute to the debate and continuous improvement of the international standards and frameworks. andy haldane, executive director for financial stability at the bank of england, in a speech to a conference in december 2011, hosted by the institute of chartered accountants in england and wales, for example, questioned the appropriateness of fair value accounting for the banking sector. he claimed that : “ historically, fair value accounting principles have gained ground when the going has been good, and lost it when it has got tough. … during the downswing, fair value principles are rolled back. ” similarly, brenton saunders, a director at an asset management firm, in a recent article in a local financial magazine questioned the appropriateness of full fair value accounting and the mark - to - market of reserves and resources of mining companies. i shall refrain from expressing an opinion on the appropriateness of fair value accounting, as we know that other conventions such as amortised cost valuation also have their own shortcomings, particularly when it comes, for example, to the recognition of interest rate risk. i do, however, believe that both andy haldane and brenton saunders touch on issues that are worth debating and i would like to see far more robust public discourse by

the spill - over effects of the reversal of the highly accommodative monetary policy by the advanced economies. the domestic economy the domestic economic growth outlook has weakened further following the disappointing first quarter annualised growth rate of 0. 9 %. of some concern is the low growth in real gross fixed capital formation, which moderated from an annualised 4. 3 % in the final quarter of 2012 to 2. 5 % in the first quarter of 2013. the bank has recently revised its growth forecast for 2013 lower, from 2. 4 % to 2. 0 % and for 2014 from 3. 5 % to 3. 3 %. the risk to the growth outlook is assessed to be on the downside, particularly due to the electricity supply constraints, difficult labour market conditions, particularly in the mining sector, and weaker commodity prices. unemployment levels bis central bankers ’ speeches continue to remain sticky and have risen in the first quarter of 2013 to 25. 2 %. of particular concern is the increase in the youth unemployment rate to 52. 9 % in the first quarter. although targeted consumer inflation surprised on the down side in may 2013, decelerating from 5. 9 % in april to 5. 6 %, this easing in price pressures is assessed to be temporary. the bank ’ s latest inflation forecast has been revised upwards, and inflation is expected to average 5. 9 % and 5. 5 % in 2013 and 2014, respectively, with a temporary breach in the target during the third quarter of 2013 when inflation is expected to average 6. 3 %. the upward pressure on inflation is mainly due to the continued currency weakness and higher than expected fuel price increases. the role of the sarb the south african reserve bank mandate as set out in the constitution is to protect the value of the currency in the interest of balanced and sustainable economic growth in south africa. price stability is generally viewed as a critical element of the foundation of an economy and contributes towards achieving economic growth, development and employment creation. the achievement of price stability, in the case of south africa, is quantified by the setting of an inflation target by government that serves as a yardstick against which price stability is measured. the achievement of price stability is furthermore underpinned by the stability of the financial system and financial markets. in pursuit of its mandate and purpose, the bank performs the following functions : • formulating and implementing monetary policy ; • promoting financial stability ; • issuing banknotes and coin ; • regulating and supervising the banking