Hong Kong’s Securities and Futures Commission (SFC) has reminded listed firms of their duty to critically disclose meaningful price-sensitive information, rather than resort to just mechanical box-ticking, the Hong Kong Economic Journal reported Thursday.
Although the volume of inside information announcements has increased by 52 percent since the introduction of the new statutory disclosure regime, many of the announcements on profit alerts and warnings, which have seen a rise of 16 percent in number, did not explain in specific the extent nor provide specific figures, the SFC was quoted as saying in the first issue of its corporate regulation newsletter.
The securities watchdog has raised concerns about the disclosures of listed companies which are set to release their financial results, possibly paving for more profit alerts and warnings.
Profit alerts and warnings issued just days before results announcements have caught SFC attention. It would be of concern if this were the first opportunity for the board to gain an understanding of the results and decide that profits were substantially different from expectations, the watchdog said.
The newsletter pointed to the poor impact of disclosures of certain listed companies with regard to their share price movements. The disclosures merely state that there will be a “substantially” or “significantly” greater profit or loss, without giving specific figures, the watchdog noted.
Listing sponsors are also reminded to look critically at the opinions of experts engaged on technical matters. Including unreasonable or inaccurate opinions in listing applications could result in the suspension of the vetting process or other sanctions, the SFC said.
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