SINGAPORE (Feb 7): Effective today, SGX-listed companies on the whole will do away with the existing quarterly reporting (QR) under a new risk-based approach adopted by the stock exchange.

However, companies that have a modified opinion from its auditors on its latest financial statements will have to continue with QR.

This includes those where auditors have expressed a material uncertainty relating to going concern based on its latest financial statements.

And if Singapore Exchange Regulation (SGX RegCo) has regulatory concerns with a particular company, the latter will also have to report its financials on a quarterly basis.

Based on these criteria, 109 companies will have to undertake QR, according to June Sim, SGX RegCo’s head of listing compliance.

They comprised 61 Mainboard-listed companies and 48 Catalist-listed companies.

Of these, Sim noted that 94 companies are required to undertake QR due to a modified audit opinion on their latest financial statements, while six companies are due to regulatory concerns.

The remainder nine companies are required to report their financials on a quarterly basis, due to both audit and regulatory concerns.

Sim explained that regulatory concerns must relate to company matters that will have a “significant financial impact”.

This means that companies with non-significant financial impact will not be addressed via QR.

A case in point is Datapulse Technology, which is facing issues surrounding its hospitality agreements with a related party, she said.

“In other words, in determining whether a company has to do QR, we would have to look at firstly the severity of the matters, and the matters must have significant financial impact,” Sim told reporters on Feb 6.

“Even if it is an omission of information that leads to an establishment of a false market, we have the discretion to place them under QR,” she added.

Still, there are exemptions.

Companies that are under provisional liquidation, judicial management or winding up, as well as cash companies, are not required to undertake QR, said Sim.

This is because such companies have ceased to conduct normal operations of business, and thus, render QR meaningless, she explained.

That said, if there are any material developments at the company, they would be subject to continuous disclosure rules, and thus, are required to be announced to SGX.

For now, companies that are required to undertake QR – assuming a Dec 31 financial year end – will have to do so for the current quarter (January to March 2020).

This is applicable to companies that were already subject to QR under the previous regime.

Companies that are required to undertake QR, but were not subject to it under the previous regime, are given a one-year grace period to do so.