- High compliance rates with annual report disclosure by listed issuers
- Continuous improvement in disclosure and compliance of money lending transactions
- Recommendations made to enhance quality of management discussion and analysis, and financial disclosure under prevailing requirements (including accounting standards)
- Publication of a customised Guide on Preparation of Annual Report to facilitate issuers in preparing annual reports
The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), is today (Tuesday) pleased to present a report (the Report) on the findings and recommendations of its annual review of issuers’ annual reports1 for the 2023 financial year end.
In the review, issuers’ compliance with the specific disclosure requirements for annual reports under the Listing Rules (Rules) was assessed, supported by the use of artificial intelligence technology to cover the large volume of annual report texts. Consistent with our previous reviews, the Exchange also adopted a thematic approach, selecting several specific areas for review, including financial statements with auditors’ modified opinions, material lending transactions, management discussion and analysis, and financial disclosure under specific accounting standards.
The Exchange is pleased that issuers continued to achieve a high rate of compliance with the disclosure Rules and accounting standards. From its thematic review, the Exchange acknowledged a continuous improvement in issuers’ disclosure of material money lending transactions. Our review identified room for improvement in disclosure in certain areas for which recommendations are presented in the Report.
In conjunction with the publication of the Report, the Exchange has published a Guide on Preparation of Annual Report (the Guide), which summarises prevailing recommendations from our previous reviews as well as all disclosure Rules applicable to annual reports, to facilitate issuers in preparing future annual reports.
HKEX Head of Listing, Katherine Ng, said: “We are very pleased to observe another year of high compliance rate and continuous improvement in the areas reviewed this year. In line with HKEX’s commitment to promoting high standards of governance, as well as our recent initiatives to enhance our guidance materials to support issuers on their listing journey, the Report has adopted a new format that presents our findings and recommendations in a streamlined approach for more effective engagement. In addition, we have prepared the Guide to provide listed issuers with customised “one-stop” reference for the preparation of annual reports. We encourage issuers to make good use of these documents and to seek continuous improvements in transparency and governance.”
The Report is available under the “Listing Regulations – Listed Issuers – Exchange’s Reports – Review of Issuers’ Annual Reports” section of the HKEX’s website.
The Guide is available under the “Listing Regulations – Rules and Guidance – Interpretation and Guidance – Guidance – Guidance Materials for Listed Issuers – 10. Continuing obligations” section of the HKEX’s website.
Note:
- Excluding annual reports issued by collective investment schemes listed under Chapter 20 of the Listing Rules for the Main Board.
About HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) is a publicly-traded company (HKEX Stock Code: 388) and one of the world’s leading global exchange groups, offering a range of equity, derivative, commodity, fixed income and other financial markets, products and services, including the London Metal Exchange.
As a superconnector and gateway between East and West, HKEX facilitates the two-way flow of capital, ideas and dialogue between China and the rest of the world, through its pioneering Connect schemes, increasingly diversified product ecosystem and its deep, liquid and international markets.
HKEX is a purpose-led organisation which, across its business and through the work of HKEX Foundation, seeks to connect, promote and progress its markets and the communities it supports for the prosperity of all.
www.hkexgroup.com
Ends