Bangkok--12 Feb--SEC
The SEC places a high priority on raising the quality of information disclosure of listed companies, particularly management discussion and analysis (MD&A) in the annual registration statement (Form 56-1) since it is vital to investors’ investment decisions. With its plan to study and consult with related parties, the SEC recently organized a seminar to determine MD&A guidelines, proposing recommendations, and distributing a checklist, in order for listed companies to improve their information disclosure.
For an informed investment decision, investors need to analyze MD&A in the Form 56-1 together with company financial statements, while the results of CG Watch 2012 survey organized by the Asian Corporate Governance Association and CLSA Asia-Pacific Markets indicated that information disclosure on MD&A of Thai listed companies still has room for improvement. The SEC has therefore planned to study overseas rules and practices, gather information from the industry including investors, and consult with related parties to raise the quality of MD&A in the Thai capital market on par with international standards.
In this connection, the SEC started the plan early this year with an MD&A seminar on January 30, 2013 at the Ambassador Hotel, Bangkok, with more than 600 participants from listed companies and financial advisors. At the seminar, the SEC executives and a guest speaker shared their views and knowledge on international MD&A standards and practices, as well as case studies. MD&As should reflect the whole business operation, not only the financial statements in particular; as well as have clear explanations covering key factors that result in company performance and financial condition; including both external factors on industrial economic condition and internal factors such as company policy or strategic plan, and factors or risks that may have impacts on future performance and risk management measures.
In addition, the SEC provided recommendations concluded from the seminar and distributed along with checklist to listed companies which would be useful for their 2012 MD&A preparation. The seminar documents and video, recommendation, and checklist are available for public access at the SEC website (www.sec.or.th).
SEC Secretary-General Vorapol Socatiyanurak said that “The SEC continually gives high priority to the quality of information disclosure. MD&A is the information that every company has to prepare to respond to inquiries from the investing public. We need to review the quality of MD&As to ensure they have illustrated essential information correctly, sufficiently, and comprehensively. The SEC’s seminar, recommendations, and checklist are the tools that enable listed companies to enhance their disclosure quality. If they all can proceed in accordance with these guidelines, it will definitely be beneficial to both investors and the companies in the long run.”