Sebon to bring penalty guidelines for firms
KATHMANDU:
The capital market regulator is seeking to introduce a provision of gradually penalising the listed companies that chose to flout the rules.
The listed companies tend to disregard the basic regulation of publishing and submitting the quarterly financial reports. Though a lot of listed companies publish their financials’ in newspapers but not even half of them submit the report to Securities Board of Nepal (Sebon) within the stipulated time.
“Sebon is planning to penalise the listed companies with monetary fine for the first offense in such cares. However, repeated offense will be dealt with harsher punishment,” said director of Sebon Niraj Giri.
“The current provision allows monetary penalty but the conditions attached to it are very harsh thus Sebon refrains from fining the companies,” he said, adding that the regulator is hopeful that with the implementation of planned penalty the listed companies and other securities businessperson can be disciplined to submit the financials in time.
According to the existing regulations, if the regulator slaps monetary fine to the companies then the law requires the promoters disqualified to hold the position of director or be appointed on managerial posts in any of the public limited company for next ten years which according to the regulator is an extreme punishment.
The company’s negligence regarding the report submission and publication reflects their standing in terms of following proper code of corporate governance and eventually harm them.
“The investors get discouraged to hold the stocks of the companies that do not disseminate their financial information on a timely basis,” share analyst and chairman of Securities Research Center and Services (SRCS) Rabindra Bhattarai, said, adding that companies need to recognise the importance of letting their shareholders know their financial health.
In the last quarter of the past fiscal year too, only 93 companies among 202 listed ones did submit their financial report to the regulator.
The listed companies demonstrate their indiscipline repeatedly by disregarding the submission of their financials within the stipulated time. In the first quarter of the current fiscal year also, among 185 listed companies only 65 submitted the report within the stipulated time. In the second quarter also, among 192 listed companies in the secondary market that were supposed to submit the report to Sebon, 119 submitted their financial report within the stipulated time.
In the third quarter, Sebon received the financials of only 103 companies among 203 listed companies that were supposed to submit the financials.
Most of the stakeholders –stock exchange, listed companies and merchant bankers tend to ignore submitting the financials to the regulator on time –in some cases do not submit at all. In the absence of penalty for the late submission from the regulator, the companies keep ignoring to submit the report.
Source: THT
The capital market regulator is seeking to introduce a provision of gradually penalising the listed companies that chose to flout the rules.
The listed companies tend to disregard the basic regulation of publishing and submitting the quarterly financial reports. Though a lot of listed companies publish their financials’ in newspapers but not even half of them submit the report to Securities Board of Nepal (Sebon) within the stipulated time.
“Sebon is planning to penalise the listed companies with monetary fine for the first offense in such cares. However, repeated offense will be dealt with harsher punishment,” said director of Sebon Niraj Giri.
“The current provision allows monetary penalty but the conditions attached to it are very harsh thus Sebon refrains from fining the companies,” he said, adding that the regulator is hopeful that with the implementation of planned penalty the listed companies and other securities businessperson can be disciplined to submit the financials in time.
According to the existing regulations, if the regulator slaps monetary fine to the companies then the law requires the promoters disqualified to hold the position of director or be appointed on managerial posts in any of the public limited company for next ten years which according to the regulator is an extreme punishment.
The company’s negligence regarding the report submission and publication reflects their standing in terms of following proper code of corporate governance and eventually harm them.
“The investors get discouraged to hold the stocks of the companies that do not disseminate their financial information on a timely basis,” share analyst and chairman of Securities Research Center and Services (SRCS) Rabindra Bhattarai, said, adding that companies need to recognise the importance of letting their shareholders know their financial health.
In the last quarter of the past fiscal year too, only 93 companies among 202 listed ones did submit their financial report to the regulator.
The listed companies demonstrate their indiscipline repeatedly by disregarding the submission of their financials within the stipulated time. In the first quarter of the current fiscal year also, among 185 listed companies only 65 submitted the report within the stipulated time. In the second quarter also, among 192 listed companies in the secondary market that were supposed to submit the report to Sebon, 119 submitted their financial report within the stipulated time.
In the third quarter, Sebon received the financials of only 103 companies among 203 listed companies that were supposed to submit the financials.
Most of the stakeholders –stock exchange, listed companies and merchant bankers tend to ignore submitting the financials to the regulator on time –in some cases do not submit at all. In the absence of penalty for the late submission from the regulator, the companies keep ignoring to submit the report.
Source: THT
