India Inc’s disclosures are easier now
To enable investors know the performance as early as possible, SEBI has given companies the option of submitting either audited or unaudited results within a month from the end of each quarter, reports Vyas Mohan.business Updated: Jul 10, 2007 23:39 IST
The Securities and Exchange Board of India (Sebi) on Tuesday amended Clause 41 of the listing agreement, in which the regulator prescribes norms for companies reporting financial results.
To enable investors know the performance as early as possible, the market regulator has given companies the option of submitting either audited or unaudited results within a month from the end of each quarter. Earlier, companies were required to submit unaudited results to stock exchanges within a month from the end of the quarter.
“The move is welcome as it creates a facilitative environment. Companies that are ready with their audited results can go ahead and file with the stock exchanges,” said R Jayaprakash, head of business intelligence at the Haribhakti Group.
Companies furnishing unaudited results will be required to file a copy of the limited review report to stock exchanges within two months from the end of the quarter.
The regulator has also mandated that the variation between items in unaudited and audited results should not be greater than 10 per cent or Rs 10 lakh, whichever is higher, against the earlier allowed difference of 20 per cent. However, analysts said rarely do companies’ audited and unaudited reports differ by more than 10 per cent.
“Since companies are using computers to prepare books of accounts, there may not be a reason for variation of more than 10 per cent between audited and unaudited reports. And it should be in the normal case possible for companies to submit both the reports within one month,” Amar Chintopant, CFO of 3i Infotech, a Mumbai-based software firm.
Further, the regulator has relaxed explanatory requirements for variations in audited and unaudited results.