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The Shenzhen Stock Exchange yesterday completed revision of the detailed rules on the management of raised proceeds by listed small and medium enterprises.
The revision is reflected in the following six aspects:- Further highlighting the functions of independent directors and the supervisory committee;
- Requiring that chartered public accounts present certification reports pursuant to the new accounting standards;
- Controls over the use of large idle proceeds to replenish working capital: a one-time replenishment shall be no more than 50% of the net raised proceeds; the previous replenishment has already been repaid; listed companies shall return the replenishment to the designated account for raised proceeds and disclose related information before maturity of the fund;
- Detailed regulations on the use of the remained proceeds for higher operability and efficiency;
- Specifying certain terms in the detailed rules, including: listed firms which have pulled off two rounds of fund raising shall set a special account for raised proceeds; the number of such special accounts (including those of the subsidiaries or the controlled affiliates of the listed firms) shall not outnumber that of the related projects; the time interval between the previous capital input and fund transfer into special accounts shall be no longer than 6 months; the audit committee shall report to the board of directors on the major risks involved in raised funds management;
- Simplifying some of the deliberation procedures and information disclosure requirements.
The revision, in accordance with relevant regulations and detailed rules of the China Securities Regulatory Commission, replaced the original version released at the end of 2004 and included format guidelines to the special report on the annual use of raised proceeds.
The revision reiterates the resolve of the SZSE to tighten supervision and management of raised funds on the SME board and effectively protect the legal rights and interests of investors. ?
