Shanghai Stock Exchange and Shenzhen Stock Exchange announced on Jan 4 that all the companies listed before Dec 31, 2009, should release their annual reports before the deadline set for April 30, 2010, and no later than the release of their first quarter report in 2010.
According to the schedules of the two exchanges, the first company listed on Shenzhen Stock Exchange to release its annual report would be Guilin Jiqi Pharmaceutical Co on Jan 12 and the first listed in Shanghai would be Wolong Real Estate Group Co on Jan 15.
According to the exchanges' regulations, companies listed between Jan 1 and April 30 that did not disclose audited financial and accounting information in their prospectuses should release the information before April 30.
Companies predictably unable to submit the 2009 annual reports by the deadline should explain the reasons and provide solutions and delayed time by submitting written reports to the exchanges.
In the following situations, listed companies should disclose their performance predictions, corrections to the performance predictions or corrections to profits predictions before Jan 31, 2010: listed companies predicted their net profits generated in 2009 to be negative; listed companies predicted their net profits to increase or decrease by over 50 percent compared with the previous year or foresaw that they would go from loss-incurring to profit-making in 2009 but did not make performance predictions; companies foresaw that their actual performance in 2009 would differ greatly from their predictions released earlier.
The stock exchanges also asked the accounting firms to correct faults in the previously disclosed financial reports in official announcements before the release of the annual reports.
The boards of the listed companies should pay attention to the commitments made to the 2009 yearly performances. For the commitments unable to be met, the board should audit the actual profits and the differences of the actual profits from the committed amount, and urge the related parties to fulfill the commitments. This information should also be included in the annual reports and audited by accounting firms.
The stock exchanges stressed that the annual reports should disclose violations of board members, supervisors, senior executives and shareholders holding more than 5 percent of the companies' shares in the trading of the stocks and measures against the violations. The annual reports should also disclose the relevant information about the illegal incomes from the illegal stock trading.
The Shenzhen Stock Exchange announced that companies listed on Small and Medium Enterprises Board or China's NASDAQ-style board ChiNext that planned to release annual reports in March or April should release short statements before Feb 28 according to relevant regulations. The exchange also encouraged other companies to release short statements before the release of the annual reports. If information leaks or the spread of rumors caused the instability in the companies' stock prices before the release of the annual reports, companies should immediately disclose financial data according to relevant regulations.
For the companies listed on ChiNext unable to release their annual reports before the deadline, the Shenzhen Stock Exchange would suspend the stock and its derivatives from trading on the first trading day in May. After it resumes trading, the exchange would issue a delisting risk warning to the company and condemn the company and relevant staff in public.