IPO application passing rate dropped significantly in the first ten months, IPO audit highlights the quality of the information disclosure
发布人:高飞  发布时间:2018-01-29   浏览次数:13

According to the public data, by October 31, the approval rate of CSIEC(China securities issuance examination committee) was 64%. In the first 10 months of this year, the IPO approval rate was 80%.Insiders pointed out that supporting the development of the real economy and encouraging innovative enterprises are increasingly important as the functions of the capital market. Continuing to strengthen the financial supervision and strict the IPO audit would make the outstanding enterprises emerged and bad firms prevented, which would finally help to protect investors and optimize the market ecology.

Strictly control the quality of the company

According to Wind data, by October 31, this year, the CSRC has reviewed the initial application of 430 enterprises, of which 344 firms were approved, 19 firms wre postponed, 8 firms were canceled and 59 firms were failed. The IPO approval rate was 80%, down more than 11 percentage points from the same period in 2016. The pass rate in the first 10 months of last year was 91.57%.

By October 31, 25 companies were audited by the new CSIEC(China securities issuance examination committee).Among the companies, 16 enterprises passed the audit, accounting for 64%; 6 firms were rejected, accounting for 24%; 3 firms were postponed votes, accounting for 12%.

Under the background of the normalization of IPO, strict access to listed companies is the basic guarantee for the continued normalization. Yuan Xuya, the chief economist of Central China Securities said. And the IPO application rate decline and the strict audit gave a strong signal to the market that quality assurance is an important responsibility of CSIEC. Strictly controlling the quality and entrance of listed companies is the common goal of the market, investors and regulators, which would create conditions for the stable and healthy development of the securities market from the source.

The quality of information disclosure is crucial.

The scale of new issues is tightening and capital market access is tight. The CSIEC focuses on specific financial details such as accounts receivable, analyzes important issues such as the change of equity, and makes prudent judgment on the non-standard behavior of enterprises.” Tian Lihui, the charity of the Institute of Finance and Development, Nankai University, said. He also considered that the key point of the IPO issuance examination work is investigating applicants whether fraud and compliance, such as verify the enterprise's corporate governance, information disclosure, equity changes, financial data, raise use, affiliate transaction, profit prospects and the operation specification etc.

From this year's inquiries to the rejected companies, Pan Xiangdong pointed out that financial data, continued profitability and standardized operations were full of problems. Is the company's financial data true? Are companies able to resist the risk of profit declining? Are there any irregularities in the development of the enterprise? These issues are of concern.

Pan Xiangdong said that if applicants want to smoothly pass through the audit and realize the listed financing, they ultimately need to do is to convince CSIEC that the applicant is a real company, a good company and a behave company. To achieve this goal, the enterprise can't whitewash, nor than rely on fraud. On the contrary, the companies should show their true qualities and potential sincerely, and improve the imperfect and insufficient aspects of the past actively, so as to get understanding and trust from CSIEC and investors.

Tian Lihui pointed out that companies need to improve their internal skills, strengthen their core competitiveness and strictly regulate corporate governance, rather than trying to fool the capital market. The process of IPO is an open and transparent process that can withstand the scrutiny of the CSIEC and the market.

The issue is expected to be continuous tightening.

The criteria for IPO review may not be necessarily improved, but the attention to detail may be getting better and better, and the punishment for fraud is bound to get bigger and bigger. Pan Xiangdong said. He stressed that supporting the development of the real economy and encouraging innovative companies are more and more important as the functions of capital market. The objective of audit is to put the fake, bad and unruly enterprises out of the capital market, to give the enterprises with financing needs and good quality more understanding and convenient. So the trend of auditing should be improving audit efficiency,distinguishing good from ill.

Tian Lihui considered that financial regulation would be further strengthened, IPO audit would be further tightened. In this way, we could make the outstanding enterprises stand out and prevent bad enterprises from passing off the sham as the genuine, which would help to protect investors, improving the quality of the market.

When releasing the 35 IPO firms with termination reviews and 18 IPO firms that failed to pass the review, the CSRC(China Securities Regulatory Commission) stressed that they would continue to publish the name list of IPO companies periodically that are terminated and failed in the review, as well as the main problems focused in the audit in the future. They would continue to improve the transparency of issuance supervision and further implement Legal, Comprehensive and Strict, the work requirements of regulation. They would continue to supervise and urge the issuers and intermediaries to take their responsibilities, improve the quality of IPO companies, and support the qualified enterprises go to public and get financed. At the same time, they would also continue to improve the capital market’s ability of servicing entity economy and maintain the security of economic and financial system, so as to provide energy for the development of capital market and entity economy.