boiman
06-08-2009, 01:59 PM
Most listed companies have submitted their finance reports for the first six months of 2009, but the majority of the reports have not been verified by audited firms as requested.
The HCM City Stock Exchange (HOSE) and Hanoi Stock Exchange (HNX) have reported that 278 listed companies have announced their business results for the first six months of the year, but they stressed that these are the un-audited reports.
“Less than 10 finance reports have been verified by audited firms,” said Tran Anh Dao, Director of Listing Division under HOSE.
Meanwhile, Decision No 246 released earlier this year stipulates that quarterly finance reports must be verified by audited firms.
Explaining why they have not had finance reports verified, listed companies said that it will take time to have finance reports verified, while they need to announce their business results for investors to reference.
According to Dao, the required verification of quarterly finance reports aims to bring accurate information about listed companies’ business performance to shareholders. However, since the market now has a bigger scale (374 companies are listed on both bourses), while the number of auditing firms remains limited (only 40 auditing firms have been licenced to audit listed companies), many finance reports have not been audited.
Some corporations have said that as they have many member companies, it takes a lot of time to gather information from the companies and thus they cannot release information early.
According to Dao, HOSE is encouraging listed companies to release information soon, even before they can show verified reports. However, Dao said that many listed companies still do not want to expose information, since they fear that the un-audited and audited figures may be different, and may cause misunderstandings with investors.
In 2008, many listed companies released quarterly finance reports which all showed profit, but the yearly finance reports showed that in fact, they incurred heavy losses. That is the reason why the State Securities Commission has decided to tighten the regulations on information exposure in 2009, while requiring that quarterly finance reports be verified.
However, the regulation has not been respected over the last two quarters. To date, investors still have to consider un-audited figures provided by listed companies to make investment decisions.
Head of the Market Development Division under the State Securities Commission Nguyen Son said that the Ministry of Finance is going to amend the currently-applied legal document on information exposure, and possibly require listed companies to have finance reports verified every six months instead of every quarter. Verification would have to be completed within 45 days of the last day of the half, instead of 25 days as currently applied.
Le Dat Chi, a securities expert, said that it is absolutely possible for securities companies to have their finance reports verified within 25 days of the last day of every quarter. He cited the Refrigeration Engineering Enterprise ([url="http://www.vietstock.com.vn/vstfinance/StockDetail.aspx?scode=REE&q=REE" target=_blank>REE) as an example.
The HCM City Stock Exchange (HOSE) and Hanoi Stock Exchange (HNX) have reported that 278 listed companies have announced their business results for the first six months of the year, but they stressed that these are the un-audited reports.
“Less than 10 finance reports have been verified by audited firms,” said Tran Anh Dao, Director of Listing Division under HOSE.
Meanwhile, Decision No 246 released earlier this year stipulates that quarterly finance reports must be verified by audited firms.
Explaining why they have not had finance reports verified, listed companies said that it will take time to have finance reports verified, while they need to announce their business results for investors to reference.
According to Dao, the required verification of quarterly finance reports aims to bring accurate information about listed companies’ business performance to shareholders. However, since the market now has a bigger scale (374 companies are listed on both bourses), while the number of auditing firms remains limited (only 40 auditing firms have been licenced to audit listed companies), many finance reports have not been audited.
Some corporations have said that as they have many member companies, it takes a lot of time to gather information from the companies and thus they cannot release information early.
According to Dao, HOSE is encouraging listed companies to release information soon, even before they can show verified reports. However, Dao said that many listed companies still do not want to expose information, since they fear that the un-audited and audited figures may be different, and may cause misunderstandings with investors.
In 2008, many listed companies released quarterly finance reports which all showed profit, but the yearly finance reports showed that in fact, they incurred heavy losses. That is the reason why the State Securities Commission has decided to tighten the regulations on information exposure in 2009, while requiring that quarterly finance reports be verified.
However, the regulation has not been respected over the last two quarters. To date, investors still have to consider un-audited figures provided by listed companies to make investment decisions.
Head of the Market Development Division under the State Securities Commission Nguyen Son said that the Ministry of Finance is going to amend the currently-applied legal document on information exposure, and possibly require listed companies to have finance reports verified every six months instead of every quarter. Verification would have to be completed within 45 days of the last day of the half, instead of 25 days as currently applied.
Le Dat Chi, a securities expert, said that it is absolutely possible for securities companies to have their finance reports verified within 25 days of the last day of every quarter. He cited the Refrigeration Engineering Enterprise ([url="http://www.vietstock.com.vn/vstfinance/StockDetail.aspx?scode=REE&q=REE" target=_blank>REE) as an example.