NO RE­COURSE

Finweek English Edition - - Companies & Markets -

SHARE­HOLD­ERS in un­listed ven­tures tardy in pro­duc­ing au­dited an­nual fi­nan­cial state­ments – those all-im­por­tant doc­u­ments that help de­ter­mine the worth of an in­vest­ment – are re­ally up in the sky with­out a pro­pel­ler. Fin­week (and its web­site, Fin24.com) has reg­u­larly re­ported on un­listed ven­ture cap­i­tal com­pa­nies un­able (or per­haps un­will­ing) to pub­lish au­dited fi­nan­cial state­ments timeously.

Cur­rently au­dited fi­nan­cial state­ments for un­listed ven­tures such as Su­per­tow In­ter­na­tional, APMI Hold­ings, SunAir Hold­ings and Wealth 4 U are cur­rently over­due for pub­li­ca­tion. With­out ac­cess to au­dited fi­nan­cial state­ments prospec­tive share­hold­ers have no inkling of the fi­nan­cial sta­tus of a com­pany, nor can they cal­cu­late or es­ti­mate the value of shares in such ven­tures.

It’s an un­ac­cept­able turn of events, flout­ing any ac­cept­able norms in ac­count­abil­ity and trans­parency. It also shows scant re­spect for the rights of share­hold­ers who, in most in­stances, have pro­vided the bulk of the work­ing cap­i­tal.

Share­holder ac­tivist Theo Botha ar­gues that if fi­nan­cial state­ments can’t be pro­duced timeously, it’s of­ten a clue that some­thing could be un­fold­ing at a com­pany. Botha says a more proac­tive approach should be ap­plied to er­rant com­pa­nies, es­pe­cially where share­hold­ers are prej­u­diced by a lack of com­pul­sory fi­nan­cial in­for­ma­tion. “Oth­er­wise we end up hav­ing at best a com­mis­sion of en­quiry into a com­pany. But that’s af­ter the event and re­ally is too late to help share­hold­ers.”

But ex­actly where share­hold­ers can turn for help isn’t that ap­par­ent. Gerry An­der­son, deputy ex­ec­u­tive of­fi­cer at the Fi­nan­cial Ser­vices Board (FSB), says the mat­ter of late re­port­ing by un­listed pub­lic com­pa­nies is rather the do­main of the Regis­trar of Com­pa­nies. “I don’t see how the FSB could be in­volved… I sug­gest you phone the De­part­ment of Trade & In­dus­try.”

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