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Talking about the problems in the information disclosure of listed companies in China and Countermeasures

Author: WenZhe From: www.yourpaper.net Posted: 2010-05-09 18:29:30 Read:
Paper Keywords: insider trading information disclosure of listed companies
Abstracts: other countries with mature market, information disclosure is the cornerstone of the management system of the China Securities. Very profound manifestation of the principle of information disclosure in the securities legislation, securities market participants can get enough information to make rational investment decisions, they will be able to get the best protection. The most important is mandatory prospectus disclosure requirements would lead to a public offering of securities prices become more reasonable, and the constant or continuous disclosure of information will help the secondary market in a certain period of time form a reasonable price.
Establish and improve the information disclosure system of listed companies in China, for the protection of the legitimate rights and interests of the majority of investors (especially small and medium investors), to promote the improvement of the governance structure of listed companies, reasonable optimize configuration resources of the community as a whole, to strengthen the government's macro-control and micro regulation, protection of important significance for the healthy development of the securities market can not be underestimated. The late start of the construction of China's securities market, the outstanding specifications, still a long way to go in terms of system construction, law enforcement and regulatory information disclosure of listed companies.
First, the main problems in the information disclosure of listed companies in China
Information disclosure system and practice of China's listed companies there are still various contradictions and problems, which greatly affect the specification and development of the market.
(A) the quality of information disclosure violations frequent.
With the constant introduction of relevant legal norms, the Chinese listed company disclosure system has made great progress, information transparency has greatly improved. However, we also note a very good sign, that is quantity rather than quality of information disclosure of listed companies. Now listed companies to disclose the announcement capacity is growing, but does not have much useful information, most of the company's relevant laws and regulations of the repeat, not much practical value.
Another aspect of listed companies to disclose the irregularities did not improve, and even tended to increase. In February 2007, the Shanghai and Shenzhen Stock Exchange, the information disclosure of listed companies on the 2006 rating: 514 listed companies in the Shenzhen Stock Exchange, 3O excellent, 249 passing, 34 adverse; SSE 646 listed companies 53 excellent 534 qualified, 59 bad. In 2006, the China Securities Regulatory Commission investigated and dealt with false disclosure 33 cases, eight penalties listed companies, more than 8O executives punishment accounting firm involved three accountants 21 people. The irregularities mainly manifested in two aspects: First, the prospectus excessive "packaging" underestimate the loss, overestimate the gains, resulting in greater deviation of earnings forecasts; two and Lee longitudinal behavior. Listed companies to use improper accounting approach, with obviously misleading financial reports to whitewash the results of operations.
(B) the information is not fully disclosed.
Due to fear of corporate competition secrets or other reasons, inadequate disclosure of listed companies for information.
1. R & D insufficient information disclosure. In today's world, science and technology is a most competitive, an enterprise in R & D as often can be a reflection of the development of this business in the future, and it can affect the future value of the enterprise. However, the reality on the securities market, the enterprises in order to ensure the future of competitive product on the market, often at the expense of interest on the capital markets, little information the disclosure of corporate R & D, or simply do not disclose this, investors it is difficult to make an objective estimate of the company, the market price of the securities it is difficult to correctly reflect the true value of the securities.
2. Human resources information disclosure is not sufficient. The competition between enterprises in the final analysis is the talent competition, the company has outstanding talent, its future earnings probability there than other companies. However, the disclosure of the company's human resources information on China's securities market is very limited, which also caused investors can not make an objective assessment of the value of the company.
3. Inadequate disclosure of solvency. China's securities market indicators reflect the solvency of financial ratios, the current ratio, quick ratio, asset-liability ratio. These indicators reflect the static data for a specific period of time and does not reflect the average of years, and these indicators at the end of the period has been artificially modified. More important for analyzing the solvency useful information can not be disclosed, such as: the structure and the liquidity of the stock, the amount of accounts receivable with aging, especially the overdue debt and a large amount of debt, these information of listed companies is often an excuse to protect trade secrets are not released.
In most cases, the company on negative information disclosure is inadequate, evasive, deliberate concealment or omission of significant events, mislead investors.
(C) the disclosure of information is not timely.
The listed company's financial position and operating conditions change, it should be in a timely manner, as soon as possible to release information to meet the needs of investors, so that investors are able to make the appropriate decisions as soon as possible. However, there are a lot of companies for a particular purpose, are not disclosed in a timely manner, thus causing great losses to investors. Thus, on the one hand investors have the previous information, there is not much practical value for future decision-making; through special channels in advance to get the time difference between the information investors take advantage of events and information disclosure reap excess interests. This resulted in a fair competition between investors and market efficiency more harm than good.
(D) The the civil audit did not play its due role.
Certified public accountants as auditors of the financial reports of listed companies, whose primary responsibility is the financial reporting of listed companies express an audit opinion to ensure that qualified its audit financial reports can be objectively and fairly reflect the financial condition of the listed companies. But now the living environment of the Certified Public Accountant is not optimistic, the competition is very fierce. With the Big Four accounting firms continue to intensify the efforts to develop new markets in China, the CPA profession increasingly competitive. In this case, some accounting firms in order to be able to pull the orders, the audit of the financial reports of listed companies can not seek truth from facts, some business accepted at below-cost prices, which will directly affect the quality of the audit. The civil audit quality, but off, the financial reports of listed companies it is difficult to objectively and fairly reflect the actual situation of listed companies, the listed company's announcement credibility to play a lot of discounts, investors can not judge a listed company's announcement the value of the company, its confidence in the securities market have been seriously affected. This is very detrimental to the development of the securities market.
From the above analysis, we can see that there is a serious problem of information disclosure of listed companies, corresponding to the listed companies in the integrity of the image is damaged severely damage the interests of investors, securities market efficiency is very unfavorable 's.
Causes of frequent violation of China's listed companies
Chinese Listed Companies frequent violations affecting the healthy development of the securities market, mainly due to the following.
(A) the system, imperfect rules, regulatory penalties owed efforts.
Objectively speaking, so far, China has not yet established a set of open and transparent, both the schema level is clear, easy to operate, equitable implementation of the information disclosed in the specification system needs to be improved, such as accounting standards, auditing standards, and if 86.5 accounting firms to implement corporate system. Accounting firm in the United States shall not be subject to limited liability, can only be a partnership. Accounting firms in China's Hong Kong, the implementation of a limited liability partnership, there must be one person jointly and severally liable. A long time, China's information disclosure of listed companies there is lax oversight, ineffective punishment. The Research Institute of the Shenzhen Stock Exchange launched the report titled "Information Disclosure the actual effect Penalties" that: 1. Especially in internal criticism based punishment, failed enough to increase the listed company information disclosure violation cost of information disclosure violation penalties. This is one of the reasons for repeated breaches of information disclosure of listed companies in China. 2. Penalties for refinancing of the company (including the issuance and allotment) compared unpunished company, no significant difference. Internal criticism based means of punishment, has no effect on the company's ability to refinance and opportunities.
(B) to reap illegal profits through insider trading.
Over the years, the immaturity of China's securities market is too speculative. Too speculative became the breeding the Makers behavior of soil. Important tactics the Makers Zuozhuang and outgoing concocted themes and timely disclosure of subject matter, if not a listed company and close co-operation will be unable to move Makers. Year, "the Guangxia" fictional profits of 745 million yuan, and its purpose is to tie the bookmaker speculation, and ultimately make a considerable part of small and medium investors almost lose everything.
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