Shanghai Stock Exchange has released the fifth memorandum regarding the 2011 annual report of listed companies – Requirements for Preparation of Management’s Discussion and Analysis – which provides guidance on narrative disclosure.
The memorandum moves from a focus on historical information to future development. Listed companies should disclose more on personalised information, fully revealing potential risk.
The specific requirements are to: provide dynamic information; highlight significant information and uncertainties; focus on analysis; stress the company’s personality; make it easy to understand; and involve management in preparing the ‘management discussion and analysis’.
Sophia Zhao, technical manager, ACCA Beijing