Companies

State firms get exemptions to publish unaudited results

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State-backed firms and agencies must secure approval for reporting their financial results from the auditor-general. FILE PHOTO | NMG

State-controlled firms listed on the Nairobi bourse have been granted a special window to publish financial results without approval by the Auditor- General as the office remains without a substantive boss.

The Capital Markets Authority (CMA), which regulates all firms listed at the Nairobi Securities Exchange, gave the approval to avoid further delay in release of results.

Current and potential investors usually rely on audited results to make investment decisions such as buying or selling stakes in listed companies.

Firms such as Kenya Power #ticker:KPLC, KenGen #ticker:KEGN and East African Portland Cement Company (EAPCC) #ticker:PORT were supposed to release their June 2019 financial results by October last year but failed to do so in the absence of Auditor-General.

“In the interest of the mentioned firms’ stakeholders, the Authority clarified that unaudited financial statements for the half year ended December 2019 should be submitted and published by 29 February 2020,” said CMA in response to the Business Daily. The results are, however, marked as unaudited, meaning they are subject to change once the Auditor-General scrutinises them later on. CMA clarified that the firms will not hold annual general meetings using unaudited financials.

CMA regulations require listed firms to prepare and publish their full year financial statements in at least two newspapers of national circulation within four months after the close of the financial period. Half year results should come after two months.

However, state-backed firms and agencies must secure approval for reporting their financial results from the auditor-general, but the previous holder of that office, Edward Ouko, retired in August last year and his successor is yet to be named.