CSE warns some firms on late disclosures

The Colombo Stock Exchange has warned certain firms in the past month for non-compliance with rules pertaining to their ‘Continuous Listing Requirements,’ officials said.

They are having some issues in terms of Section 7.8 of the Listing Rules of the CSE, which specify immediate disclosure pertaining to share dealings of directors in firms. The CSE has seen instances where disclosures have been delayed.

The CSE is following up with reasons as to why the ‘lateness’ by certain offenders who complied after many ‘calls’ threatening them to meet the terms, officials said.

The most recent incident was a disclosure dealing in relevant dealings in shares of a listed firm that was nearly two months late. “This is a far cry from an immediate disclosure,” an official added.

Last year too, the CSE warned three firms on similar errant behaviour.

The CSE will be scrutinising firms in future pertaining to such instances and the new regulations will deter offenders from delayed disclosures, officials added.

The CSE runs a disclosure based environment where public companies are required to disclose meaningful financial and other information to the public as it provides a common pool of knowledge for all investors to use to judge for themselves whether to buy, sell or hold a particular security. Only through the steady flow of timely, complete, and exact information can people make sound investment decisions.

The CSE said the Securities and Exchange Commission, had directed the exchange to amend the listing rules on disclosure requirements in relation to related party transactions of listed firms in September 2010. This was after a Business Times story that same month highlighting this issue pertaining to listed firm directors’ disclosures.