Annual filing of consolidated info by firms mooted

Disclosures aligned to global practices

To help investors get accurate and comprehensive information about companies, regulator Sebi on Tuesday proposed that listed firms file an annual information memorandum (AIM), on the lines of practices followed in the US and other large markets.

The memorandum, which is proposed to be filed by the top 200 companies by market capitalisation from the next financial year beginning April 1 and by other firms from April 1, 2015, can also be used as a reference document while raising funds.

The annual information memorandum (AIM) would primarily include details of a company, its business description, a history of major events, risk factors, management and promoter information and consolidated financial statements.

The Securities & Exchange Board of India (Sebi) has given time till March 9 for public comments on the proposed document, which would save investors from sifting through various disclosures made by the company over time.

Sebi has proposed that the document consolidate all regulatory disclosures made by listed companies and be updated within 135 days from the end of a financial year.

For companies that plan to list on the stock exchanges, the requirement for filing an AIM would commence with their initial public offers (IPOs).

Disclosures made by companies at the IPO stage are proposed to be updated on an annual basis to ensure that the latest information is available in the public domain.

AIM may be disseminated by uploading it on the company’s website and simultaneously with the stock exchanges. It should be approved by the board of directors before it is disseminated, Sebi said.  

Ccompanies make comprehensive disclosures when filing offer documents for IPOs, which are made in the primary market. AIM will provide shareholders and prospective investors with accurate and relevant information about the financial and operating performance of a company.