ANNOUNCEMENT - Amendments to the Financial Disclosure Provisions of the Main Board Listing Rules and the GEM Listing Rules

Regulatory

26 Aug 2002

ANNOUNCEMENT

AMENDMENTS TO THE FINANCIAL DISCLOSURE PROVISIONS
OF THE MAIN BOARD LISTING RULES AND THE GEM LISTING RULES

The Stock Exchange of Hong Kong Limited (The Exchange) has amended the Main Board Listing Rules (the "Main Board Rules") and the GEM Listing Rules (the "GEM Rules") in respect of:

the treatment of revalued assets in an issuer's first annual accounts published after listing; and
the content requirements for financial statements. These relate to the statement of changes in equity, changes in accounting estimates and for, the Main Board Rules only, segment disclosures.

Details of the changes and their respective effective dates are set out below.

Treatment of revalued assets in the first annual accounts published after listing

The existing financial disclosure provisions in the Main Board Rules and the GEM Rules require that where a listed issuer has caused any property assets to be valued or has caused any valuation to be made of any other tangible assets and included such a valuation in the prospectus relating to its initial public offer, the assets shall be stated at valuation in the listed issuer's financial statements. These requirements will cease to apply for new listing applications, where the advance booking form is dated on or after 1st September, 2002.

Content requirements for financial statements

The following will apply for accounting periods ending on or after 1st September, 2002 although earlier adoption is encouraged:

The requirement to disclose a "statement of movements in equity other than those arising from capital transactions with shareholders and distributions to shareholders" in financial statements will be amended to require disclosure of a "statement of changes in equity" in financial statements.
Listed issuers will be required to disclose details of any significant change in an accounting estimate that has a material effect in the current period or which is expected to have a material effect in subsequent periods. If it is impracticable to quantify the effect of the change, this fact should be disclosed.
In the case of the Main Board Rules, the segment disclosure requirements will be amended to harmonise them with those of the GEM Rules.

Reprinted pages of the Main Board Rules and the GEM Rules will be distributed in due course. The amended Main Board Rules and the GEM Rules will be available for viewing on the websites of the Hong Kong Exchanges and Clearing Limited at http:// www.hkex.com.hk and http://www.hkgem.com.

Updated 26 Aug 2002