Thinking of Doing your own Business Accounts?

Australia business conditions improve in nov survey

SYDNEY Dec 10 A measure of Australian business conditions improved modestly in November as sales and profitability picked up, leaving most sectors relatively optimistic about the outlook for the next few months, a survey showed on Tuesday. National Australia Bank's survey of more than 600 firms showed most interest sensitive sectors reported better activity in November, while a lower local dollar seemed to benefit mining and manufacturing. The report's main measure of business confidence ticked down a point to 5, from an upwardly revised 6 in October, but was still well above the average for 2013. The survey's index of business conditions gained a point to -3 in November, with its measure of sales turning positive for the first time in over a year. Profitability also improved, though employment took a turn for the worse in the month."Business conditions, while still below trend, have trended higher over recent months, supported by the low interest rate environment, higher asset prices and less lofty Australian dollar," said NAB's chief economist, Alan Oster.

One positive was a broad based rise in the index of capital expenditure, which jumped 9 points to 5 in November, the highest reading since March of 2012. That would be welcome news to the Reserve Bank of Australia (RBA) which has been counting on a revival in business investment to offset the drag from a cooling mining boom.

The central bank cut interest rates to a record low of 2.5 percent back in August and has been holding steady since amid signs the stimulus was slowly working through the economy. Oster still believes that soft domestic demand and rising unemployment will lead the RBA to cut rates again, albeit not until May next year.

Tuesday's survey found firms reported that capacity utilisation had increased four tenths of a percent to 79.7 percent in November, though that still pointed to a considerable amount of slack in the economy. There was little sign of inflationary pressure in the NAB survey. Labour cost growth held steady at restrained levels, consistent with slack in the labour market, while purchase costs growth eased a touch. Overall prices growth softened further in November to be running at just 0.2 percent at a quarterly rate.

Bahrain eyes new rules for islamic financing contracts

Bahrain's central bank has released a consultation paper to study possible changes to rules for sharia-compliant financing arrangements which the kingdom's Islamic banks can offer to accredited investors. The move comes as part of a broader push to revamp Bahrain's efforts in Islamic finance, an industry it helped to pioneer, in the face of growing competition from other centres such as Dubai, London and Kuala Lumpur.

The proposed rules would allow Islamic banks to set up special financing contracts on a wakala basis, a common sharia-compliant agency agreement where the investor agrees to bear the full risk of default. But in an apparent move to reduce risks and the possible impact on other Islamic instruments, Islamic banks would be required to segregate those funds from their own balance sheets by establishing special-purpose vehicles that would remain under the banks' control.

The consultation period for the proposed rules will close on April 20.

The central bank is also set to release a new regulatory framework for Islamic insurance, in an overhaul of standards which the regulator hopes will attract new business in the sector. In December, the central bank formally combined existing rules for issuing and listing financial securities, including sukuk, in an effort to make the process more efficient.