ob体育 is calling on company directors to ensure material business risks are adequately disclosed in annual reports to better inform shareholders and prospective investors.
As a result of ob体育鈥檚 ongoing financial reporting surveillance program and subsequent inquiries of a selection of 2022 annual reports, five listed entities have so far provided disclosure of material business risks in response to our concerns that these had not been sufficiently disclosed in the operating and financial review (OFR) of the directors鈥� report.
The entities are:
- BlueBet Holdings Limited, which made disclosures in its听Quarterly Activities Report听released on 27 October 2022;听
- Little Green Pharma Ltd, which made disclosures in its听Quarterly Activities Report听released on 31 October 2022;
- hipages Group Holdings Limited, which made disclosures in its Chair AGM Address and Presentation released on 10 November 2022;听
- Australian Strategic Materials Limited, which made disclosures in its Addendum to 2022 Annual Financial Report released on 10 November 2022; and
- Australian Agricultural Company Limited, which made disclosures in its interim financial report released on 17 November 2022.
ob体育 Commissioner Sean Hughes said, 鈥榦b体育 reminds company directors about the importance of a high-quality OFR, as it helps to inform the decision-making of investors by disclosing material risks that may affect the achievement of a listed entity鈥檚 strategies and prospects.鈥�
ob体育 continues to closely review a selection of annual reports on a risk-based approach to ensure that entities are correctly disclosing their material business risks as part of the directors鈥� report.
Background
The directors鈥� report of a listed entity must contain information that shareholders would reasonably require to make an informed assessment of the entity鈥檚 operations, financial position and business strategies, and prospects for future financial years.
The part of the directors鈥� report containing this information is referred to as an 鈥榦perating and financial review鈥�.
础厂滨颁听Regulatory Guide 247听Effective disclosure in an operating and financial review听(RG 247) provides guidance for directors of listed entities on providing useful and meaningful information to investors in an OFR.