Sebi to streamline financial reporting for listed companies

The proposals, aimed at bringing consistency, includes mandatory reporting of all figures in financial accounts in 'Rs Crore' till two decimal points, as different reporting formats (including in lakhs, millions etc) create confusion

With an aim to improve disclosure and reduce compliance cost for listed companies, market regulator Sebi proposed significant changes in the way firms report their financial results and audit observations, including those related to foreign ventures and discontinued operations.

Besides, companies would also have to mandatorily disclose book value of their shares and cash flow statements every six months, while detailed disclosure needs to be made for discontinued operations along with the financial results.

The other new proposals, which have been decided as per suggestions from Sebi's Committee on Disclosures and Accounting Standards (SCODA), include mandatory disclosure of half-yearly consolidated results in case of 20 per cent or more variation in revenue, assets, liabilities, profits or loss.

In respect of foreign subsidiaries and joint ventures, the consolidated results would have to include all those overseas ventures which together with all Indian operations would constitute 80 per cent or more consolidated turnover, net worth, profit or loss.

In the 53-page discussion paper, Sebi also said that the reporting format for all finance companies have been suitably modified so that both banking and non-banking finance companies can use the same format for their results.

For firms not having a Managing Director, the board committee for approval of financial results should have at least one third of directors and include at least one wholetime and one independent director. Sebi aso said that all listed firms will be required to submit their consolidated financial results as per notified accounting standard (Indian GAAP).