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The disclosure of the status quo and thinking of interim financial reports of listed companies

Author: SongYongChun From: www.yourpaper.net Posted: 2009-10-11 15:27:25 Read:
Interim financial reports of listed companies [Abstract] disclosure of information is important. However, there are many problems in the process of practice often: First, the disclosure is not timely; inadequate disclosure; disclosure untrue. Therefore, should be targeted to the implementation of improvement measures, highlighting the focus on information disclosure; strengthen disclosure about the company's growth; strengthen the quality of earnings information disclosure; enhanced online disclosure; increase the punishment, and so on.
[Keywords] listed company; financial reporting; disclose
The CLC Document code] F830.P1 [,] A [Article ID] 1006-5024 (2007) 12-0156-03
[Author] Song Yongchun, Yancheng Institute of Technology associate professor, research direction for financial management and accounting. (Yancheng, Jiangsu 224002)

Mankind in the 21st century into the information age. Accounting information is an important resource, one of the important quality characteristics of accounting information is the timeliness of the modern society, The enterprises many existing and potential investors, creditors and other stakeholders are very concerned about the latest information. Financial reporting information disclosed on an annual basis lagging behind, unable to meet the needs of users of accounting information, the interim financial report just can largely make up the annual report of the time interval is too long defects. Our country in recent years, the practice of the information disclosed in the framework of the interim financial report. In practice, the interim financial reports of listed companies are not timely disclosure, inadequate, untrue and smooth profits phenomenon. In this paper, through the analysis of accounting information and case, examine and reveal problems in the countries listed company interim financial report disclosed, proposed improvements, thereby enhancing the usefulness of the accounting information.

Interim financial reports of listed company information disclosure significance

The interim financial report is based on the preparation of financial reports to the medium-term, interim reporting period shorter than a full fiscal year. The interim financial report of listed companies in China refers to the quarterly reports and semi-annual reports, annual report for the listing of the company's experience in epigraphy, then semi-annual reports can be called a predictor of listed companies, and quarterly reports can be likened to the Pathfinder is Of the SFC in 1994, issued a public offering of stock the company information disclosure content and format guidelines (No. 3) - the content and format of the interim financial report (Trial) ", formally introduced on January 1, 2007, the Ministry of Finance "Accounting Standards for Business Enterprises No. 32 - Interim Financial Reporting".
1 The preparation of interim financial reports to help improve the quality of accounting information. An important quality characteristic of accounting information is timely and useful financial information disclosed to a large extent depends on its timeliness. Even if a lot of information very reliable, time lagging behind, its value is likely to be greatly reduced, so the sooner the better for the users of accounting information, the disclosure of accounting information and pass interim financial report just in largely meet this requirement, and to make up for the annual financial report of the interval is too long defects and improve the quality of accounting information.
2 Open interim financial report will help improve the information disclosure system of listed companies. The level of transparency and information disclosure of listed companies in the degree of perfection of the system, is an important indicator to measure a country's securities market and the whole market economy, the degree of maturity. The interim financial report is an integral part of listed companies' information disclosure system contains more content, with the development of China's securities market, investors are required to improve the quality of accounting information and IT rapid interim financial report information more increasingly prominent. To keep abreast of the enterprise can strengthen supervision, and therefore the preparation and public information disclosure system of the interim financial report will help improve listed companies, the securities market efficiency, promote the efficient allocation of resources.
3. Disclosed in the interim financial report will help standardize enterprise behavior. The financial reporting system is an integral part of the enterprise performance evaluation and oversight mechanisms, precisely because of periodic financial reports, the listed companies interests talent to evaluate business performance and management effectiveness, implement effective production and business activities of enterprises monitoring. Disclosed in the interim financial report can make this monitor more timely, more help to reveal the problem, seek appropriate response measures, so as to standardize the behavior of business.

Second, the problem exists in the interim financial report disclosed

(A) The interim financial report is not timely disclosure. Timeliness of information useful for decision-making of the basic conditions, is also a major interim financial report is to ensure that, if the information is not timely, it will undoubtedly be for insider trading and market manipulation opportunities. China's third quarter report for the April 30 and September 30, and the semi-annual disclosure deadline requirements for the first six months of the fiscal year after the end of two months, in accordance with this requirement, the investors in the next quarter or the next six months to over a third of the time to see quarterly or semi-annual report, from the time point of view has been lagging behind. Even so, some listed companies over the years have failed to timely publication of interim financial reports, such as Chongqing Dongyuan As of December 31, 2006 has been publicly condemned and punished four of the China Securities Regulatory Commission, and he would be punished twice in the same year fully reflects the attitude of the listed companies disclosed the interim financial report.
Another case is the delayed disclosure, there is to replace the interim report to the interim financial report or the practices disclosed in the form of a supplementary notice of major events. Topsun Science and Technology Co., Ltd., for example, since 2003, the company holding shares something An Dongsheng Group Limited and associated companies Shaanxi Dongsheng Pharmaceutical Co., Ltd. Total occupied 1,588,260,000 yuan of company funds, that is, the proportion of on the end of the year by the audited net assets of 347.58%, the material related party transactions did not fulfill the necessary approval procedures, also not timely announcement; During this period, the company provide a guarantee of 956,348,300 yuan, that the proportion of the upper end of the audited net assets 209.29%, did not fulfill the necessary approval procedures and timely disclosure obligations. Until October 31, 2006, in the form of a supplementary notice to disclose the significant transactions and events, and therefore condemned by Euronext. Operating conditions such significant changes or results dramatically change, complete the surplus predict differences large listed companies did not disclose relevant information in a timely manner, for the dealer to manipulate the market to provide an opportunity to the detriment of the interests of small investors.
(B) of the interim financial report for inadequate disclosure. Adequate disclosure of information is another important factor to affect the decisions of users. Interim financial information, there is inadequate information disclosure phenomenon. The performance for the company to correspond to the disclosure of information does not make full disclosure, but take evasive tactics the deliberately exaggerated some of the facts, to hide some of the facts, mislead investors. Some companies even non-disclosure of some of the major events, such as the China Securities Regulatory Commission in 2006 identified China Kejian Company Limited in the 2004 semi-annual report did not disclose its external guarantee contract has not yet expired 34 involving contracts worth a total of 1.411 billion yuan, U.S. $ 500 million. Guarantee contracts which occurred during the reporting period, 14 were involved in contracts worth a total of 577 million yuan. In addition, in the 34 guarantee contracts, the 21 contracts belonging to related parties guarantee, involving a total contract value of 850 million yuan, U.S. $ 500 million, 10 parts of which occurred during the reporting period related guarantee contract involving the contract amount 432 million yuan. China Kejian Company Limited is not in accordance with the relevant provisions of the public offering of securities of the company information disclosure Content and Format Standard No. 3 "is truthfully fully disclosed in the 2004 semi-annual report above guarantee.
(C) of the interim financial report disclosed untrue. The purpose of listed companies, or the use of fictitious transactions and events, or violation of the accounting system approach means, in the annual financial report, the interim financial report false statement to deceive investors, some interests. Such as the March 13, 2007, Hangxiao Steel just signed into effect the project contract "signed the announcement of the construction projects outside contract. Notice that Hangxiao Steel and registered in Hong Kong, China, the China International Fund Limited (the base) signed two overseas engineering contract (1) of the Republic of Angola - Angola housing home construction engineering - Product sales contract " the total contract value of RMB 248.26 billion (2) "The Republic of Angola - Angola housing homes by construction works contract", the total contract value of 9.575 billion yuan, a total of 34.401 billion yuan. Hangxiao Steel announcement cloth, it is questioned by the media, investors, the SFC investigation since March 17, 2007, its stop plate, May 12, the SFC issued a punishment Hangxiao identified Hangzhou The Xiao information disclosure violations untrue, Shanghai Stock Exchange Hangxiao publicly condemned, The Hangxiao Board apologize to shareholders announcement.
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