The Hong Kong Institute of Directors (HKIoD) calls on listed company directors to faithfully discharge their duty as they tackle financial reporting tasks amidst the outbreak.
On 4 February, the Securities and Futures Commission and the Stock Exchange of Hong Kong issued a Joint Statement in relation to results announcements in light of travel restrictions related to the severe respiratory disease associated with a novel infectious agent.
The coronavirus outbreak will likely affect some issuers’ plan and progress in preparing financial information for their results announcements. Many of our fellow directors are facing a difficult situation.
HKIoD had the opportunity to have an in-depth joint discussion with teams from the SFC (led by Mr Brian Ho, Executive Director, Corporate Finance), the Stock Exchange (led by Ms Bonnie Y Chan, Head of Listing) and the Financial Reporting Council (led by Dr Kelvin Wong, Chairman). From the discussion, HKIoD gained some insights and has some comfort and assurance to bring to our fellow directors.
The very purpose of the Joint Statement is to keep as much as possible the orderly and continuous running of the Hong Kong financial market. A blanket delay for financial reporting can have serious detrimental effect on the credibility of the Hong Kong market.
Under the Joint Statement, an issuer’s board may have to release financial information before the auditor can perform work. Based on our understanding, however, the regulators are fully mindful that this is a difficult situation affecting many. Directors need not become too worried so long as they have faithfully performed and discharged their duties.
We have the following guidance and advice for directors.
About The Hong Kong Institute of Directors
The Hong Kong Institute of Directors is Hong Kong’s premier body representing directors to foster the long-term success of companies through advocacy and standards-setting in corporate governance and professional development for directors. A non-profit-distributing organisation with membership consisting of directors from listed and non-listed companies, HKIoD is committed to providing directors with educational programmes and information service and establishing an influential voice in representing directors. With international perspectives and a multi-cultural environment, HKIoD conducts business in biliteracy and trilingualism. Website: http://www.hkiod.com.