SEVERAL companies, including Perth-exchanged China West International Holdings have made changes to their financial reports or accounting policies following the Australian Securities and Investments Commission review of general compliance with accounting standards.
China West agreed to amend its financial reporting to reflect that it did not control an entity that was consolidated in its June 30 2003 financial statements.
The company made an ASX announcement to this effect on February 25, indicating that the necessary adjustments would be reported as fundamental errors in its December 31 half-year report.
Another eight WA listed companies: Advanced Engine Components, Advantage Telecommunications, Computronics Holdings, Etick Limited, Fashion Intimates Limited, Preston Resources, Safe Effect Technologies and Telezon Limited, have been told by ASIC that they cannot use a lower content prospectus.
ASIC has reviewed the audited full-year financial reports of about 400 listed companies with balance dates between June 30 and July 31, 2003 for their general compliance with accounting standards.
Commission chief accountant Greg Pound said ASIC’s review had concluded that there was no indication of systemic non-compliance with accounting standards in any specific area – based on the review sample.
"Where non-compliance has been identified, we are pleased that in most cases, we have been able to achieve a transparent regulatory outcome without the need for litigation," he said.
"We will, however, continue to pursue the outstanding matters to a resolution."
Based on the review sample ASIC had initial reservations about the financial reports of 27 companies.
In addition, the financial reports of three other companies were identified by other programs.
More information was sought from 30 companies to determine whether there was significant non-compliance with the accounting standards.
"In six cases, where our preliminary concerns were confirmed, the companies have now taken appropriate action to rectify the problems identified," Mr Pound said.
In another 13 cases, ASIC is assessing whether to issue an order preventing a company from using lower content prospectus provisions of the Corporations Act or formally requesting improved disclosure in future financial reports.
Another two companies may still be subject to further action.
They are currently providing ASIC with more information or documents as further clarification is required.
In the final nine companies the matters of concern have proven not to require further action.
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