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The notice of quarterly report by the Shanghai Stock Exchange (SSE) and the Shenzhen Stock Exchange (SZSE) says that the listed companies should complete disclosure of their 1st quarter reports before April 30, 2007. The quarterly reports require that all listed companies should, according to the requirements of the new accounting standards, work out new accounting policies and new accounting estimations as their accounting basis in 2007. All this means that financial reports are to come out in line with the new accounting standards.
It is learnt that, according to the requirements of the newly amended quarterly report compilation rule by the China Securities Regulatory Commission, the notice further defines the compilation method of previous data for the same period and specific operational standard of dramatic fluctuation. Besides, in the compilation of quarterly reports, attention should be paid to special promises made by original holders of non-floating shares in equity division reform and their fulfillment.
According to the requirement of balanced disclosure, the SSE will, in principle, allow a daily maximum of 100 companies to disclose their quarterly reports. And the SZSE will, in principle, allow a daily maximum of 50 companies for disclosure.
Companies newly listed on small and medium enterprise board this April, which have not disclosed financial accounting information of the 1st quarter of 2007 in their prospectuses or listing announcements, should also disclose their quarterly reports before April 30.
The notice pointed out that listed companies should, according to requirements of the new accounting standards, formulate or modify their original accounting policies and work out or adjust their original accounting estimations as their accounting basis in 2007. All these changes should be submitted as single proposals to the companies' directorate meetings for discussion and approval upon voting. Meanwhile, time for obligation fulfillment of information disclosure and submission to the directorate meeting should be prior to that for the directorate's discussion on the 1st quarter report of 2007.
In the compilation process, listed companies should formulate and disclose their adjusted balance sheets at the beginning of the reporting period and their income statements in the same period of last year according to relevant regulations in the "Q&A No.7 on Information Disclosure Regulations for Companies Offering their Securities to the Public - Comparing Information Compilation and Disclosure of Financial Accounting during Transition Period of Old and New Accounting Standards". If main items of accounting statements and financial indicators during the reporting period fluctuate by more than 30% compared with those at the end of last year or in the same period of the year before, the situation and main reasons should be illuminated in the texts of quarterly reports.
