REVIEW OF FINANCIAL REPORTING BY ISSUERS - CYCLE 4

MARKET MATTERS: NZX REFERRALS

89.

One entity had overlooked the disclosure of a waiver in its annual report and this matter was referred to NZX for consideration. The issuer had subsequently remedied this non-disclosure. The Commission stresses the need for issuers to have processes in place to ensure waivers are disclosed in the annual report if that was a condition of the waiver.

90.

The Commission brought two matters in relation to non-disclosure of waivers to the NZX Discipline Special Division. Further review revealed the first of these matters had been satisfactorily disclosed and on the other matter the issuer will ensure that the waiver is referred to in its next annual report.

FOLLOW-UP FROM THIS CYCLE

91.

At the date of publication of this report there are a number of matters that require further follow up action and the Commission may refer these to the relevant authorities.

92.

To date correspondence with the issuers has failed to resolve the matters to the satisfaction of the Commission.

FOLLOW-UP FROM OTHER CYCLES

93.

The Commission has just received details of a final determination from NZICA regarding a complaint the Commission made in respect of the auditor of an issuer we reviewed as part of Cycle 1. The Commission is still considering the result and whether any other action is warranted.

94.

The Commission has made a further complaint to NZICA relating to NZICA members' involvement in the preparation and audit of financial statements of a publicly listed company.

ONGOING REVIEW AND ENFORCEMENT

95.

The Commission will continue to review issuers' financial reporting as part of the Financial Reporting Surveillance Programme and to take any appropriate steps to encourage compliance with Financial Reporting Standards and other elements of NZ GAAP.