HomeNewsZim Stock Exchange companies breach rules

Zim Stock Exchange companies breach rules

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Local companies listed on the Zimbabwe Stock Exchange (ZSE) are falling short of meeting the bourse’s requirements when publishing year-end financial statements, a research by the Securities Commission of Zimbabwe (SECZ) has established.

According to the findings, all financials results for the year ended 2011 did not meet the standards.

There are 72 trading counters on the bourse.

Speaking on the sidelines of the Public Accountants and Auditors’ Board (PAAB) and SECZ workshop in Harare yesterday, SECZ chief executive officer, Tafadzwa Chinamo said the commission engaged South African and other local experts to look into the status of the half-year and full-year results of 2011.

He said experts were looking at the ZSE listing requirements and the compliance with the International Financial Reporting Standards (IFRS).

“The experts did a report on each and every company.

“Sadly, there is no company that met the listing requirements 100%, and IFRS. It’s not good. We will let things go for now, but we will, going forward, show the companies where they are lacking and explain the implications,” he said.

Chinamo said the purpose of the study was not to punish companies, but that they were made aware of their shortcomings.

Some of the ZSE listing requirements include continuing obligations, methods and procedures of bringing securities to listings and disclosure of financial information.

The financial results should also carry an auditor’s opinion, Press announcements and cautionary statements.

The listing requirements also include listing fees and prelisting statements — what the companies are supposed to disclose to investors.

He said the study had a checklist of 26 items that companies were supposed to meet.

PAAB board member Brian Njikizana said when they carried out the study they realised a number of inadequacies in compliance, while in other cases there was no compliance at all.

“I think it’s a process. We are going to be having these review in compliance all the time,” he said.

In May this year, PAAB was engaged by SECZ to review the financials for 2011 after it was discovered that most companies failed to carry an auditor’s opinion and had minimum disclosures.

The auditor’s opinion is a certification that accompanies financial statements and is provided by independent accountants who audit a company’s books and record and help produce financial statements.

Financial statement disclosures are secondary information provided by companies to clarify or interpret certain published financial information.

The information would help investors understand the performance of a company and enable them to see if they could continue investing with that company or not.

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