demand transparency, accountability in business
Setting up human resources that have a reliable knowledge about the “OD” and all the intricacies, including the setting up of a treasurer of a reliable and knows the behavior of the bond market; Issuing “OD” will bring consequences that investors will demand transparency, accountability, and always monitor the performance of local government in managing development funds. In addition to demands to pay the obligation runs, will also be accompanied by the demands of performance and reporting that must be good for ratings of bonds issued to obtain a good position in the eyes of investors or the rating agencies which is used by investors. Thus, the civil servants have to change the paradigm and mindset drastically in managing finances and accountability. Accountability and transparency required by the investors will cover the entire process of issuing the bonds. Local Government should be transparent, including in the selection of lead underwriters who will be the underwriter. Local government could no longer use the same approach in managing the debt of the central government that is bilateral and negotiable. In managing the bond, investors are demanding consistency of bond interest payments and principal on time, or local government will default or fail to pay assessed. If until this happens, governments will lose confidence in the market and will no longer affect the investors interested in financial instruments issued by governments in the future, whether it’s the other bonds or may be a mutual fund.
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Tags: Bond market, Bonds, Business, Credit rating agency, Investing, investor, Local government, Mutual fund