Regulators in Hong Kong did not respond favorably to the accounting sector's call for a blanket extension of financial reporting due to travel and the work restrictions caused by the coronavirus outbreak.
In a joint statement by the Securities and Futures Commission (SFC) and the Hong Kong bourse, listed companies that are unable to meet the financial reporting deadline on March 31 have been asked to reach out with regulators and provide an explanation. Extensions will only be approved on a case-by-case basis and trading may be halted for companies that do not provide sufficient information to the market.
The announcement follows an urgent meeting held between the exchange and the Hong Kong Institute of Certified Public Accountants to address the financial reporting deadline in the midst of a deadly coronavirus outbreak.
No Auditor Agreement Required
With 1,241 of the 2,449 listed companies on the exchange from mainland China, this has naturally caused auditing challenges due to health risks and travel restrictions. Nonetheless, Hong Kong’s regulators remained adamant about resuming operations, saying that it would accept preliminary results without agreements from auditors.
«Where an issuer is unable to obtain agreement from its auditors but is otherwise in all respects able to publish its preliminary results in full compliance with the other reporting requirements set out in the Listing Rules, it should publish such preliminary results (without the agreement with its auditors) on or before the deadline,» the statement said. «In such cases, the exchange will normally allow trading in the securities of the issuer to continue.»
