New department will establish standards on financial data

The China Securities Regulatory Commission is planning to add a new department that will establish and oversee standards on financial data.

The department will collaborate with financial data providers, including Wind Information Co Ltd, to work out rules governing how financial indicators, including price-to-earnings ratio and price-to-book ratio, should be calculated, Zhu Shushan, a CSRC official, said in Shang-hai on Monday.

Zhu refused to give details about when the department will be created, or its size and administrative level. There has been a lack of standards on how to calculate financial data in China. Using different methods, different data providers and analysts often get different results on the same financial indicator. That misleads investors about market conditions and makes it harder for regulators to get the latest market dynamics.

"Prompt, correct and complete financial data is essential in coping with financial crises and solving financial risks," he said.