China Securities Regulatory Commission, Compilation Rules for Information Disclosure by Companies That Offer Securities to the Public (No. 13): Correction and Relevant Disclosure of Financial Information

Issued: December 1 2003
Interpreting authority: China Securities Regulatory Commission
Applicability: The Rules apply to circumstances in which a company's disclosed periodic reports of previous periods contain errors and it is ordered to correct; when a company's disclosed periodic reports contain errors and the board of directors decide to correct them; or other circumstances determined by the China Securities Regulatory Commission (CSRC) (Article 2).

Main contents: The corrected financial information shall be disclosed in the form of an ad hoc report of significant events in a timely manner (Article 3). The format shall conform with the provisions of the CSRC and the share listing rules (Article 4). Disclosed annual financial reports of previous periods must be audited by an accounting firm with relevant qualifications in the securities and futures businesses (Article 5). The contents to be disclosed in an ad hoc report shall include the explanations of the nature and reasons of the corrected matter from the board of directors and management, the corrected matter's influence on the financial conditions and business results as well as the financial indicators after the correction, the corrected and audited annual financial statements and relevant notes involved in the correction as well as the accounting firm issuing the audit report, and the corrected and unaudited interim financial statements and relevant notes involved in the correction (Article 6). Article 7 stipulates that if corrections are made to disclosed financial information of the previous periods (including annual, half yearly and quarterly information), the corrected financial statements shall include the corrected annual financial statements of the most recent complete accounting year affected by the correction and the corrected interim financial statements of the most recent period affected by the correction (Article 7).
Related legislation: PRC Company Law (Amended), Oct 27 2005, CLP 2005 No.10 p21 and PRC Securities Law (Amended), Oct 27 2005, CLP 2006 No.1 p31