Sebi releases consultation paper on disclosure requirements for listed entities

In the consultation paper, the capital markets regulator is looking to address the challenges faced with regard to submission of the first financial results by newly listed entities and related to timeline to fill up vacancy of directors, compliance officer, Chief Executive Officer (CEO) and Chief Financial Officer (CFO) in listed companies.

The consultation paper is also  looking to address the issue of freezing of demat accounts of the managing director, whole-time director and CEO of a listed companies  for continuing non-compliance with the LODR Regulations or non-payment of fines by a listed firms.

In order to provide adequate time to newly-listed entities to disclose their first financial results post listing, it is desirable that at least 15 days’ time period from the date of listing may be provided for such disclosures to a newly-listed entity.

At present, the newly-listed entities are required to submit their first quarterly financial results within 45 days from the end of each quarter, other than the last quarter post listing and the quarterly results for the last quarter and the annual financial results within 60 days from the end of the financial year.

“Listed entity, post listing, shall submit its first financial results, quarterly or annually as the case may be, immediately succeeding to the periods for which financial statements were disclosed in its offer document for the initial public offer, as per the timeline indicated… as applicable, or within 15 days from the date of listing, whichever is later,” Sebi said.

The above proposed amendment shall be made effective for the public issues opening on or after the date of notification of the amendments or such date as would be specified by the markets regulator, Sebi said

This comes after Sebi received representations regarding challenges faced by the newly-listed entities immediately after their listing and about the gap in the current regulatory provisions for ensuring timely disclosure of the first financial results of such newly-listed entities.