Publish company financial reports early, says minister

Finance minister Matia Kasaija. He said companies should follow the law in publishing financial reports. FILE Photo

What you need to know:

Purpose. The reports play a role in economic policies

Kampala.

The Finance ministry has directed companies to publish their audited annual financial reports on time for proper analysis of the country’s financial situation by regulators and the public.

Currently, many companies take more than one year to produce their annual financial results while some companies do not at all.

This leaves regulators, policy makers and the public in the dark as far as financial status of companies are concerned.
The directive comes at a time when multinational companies are pressured to analyse and deliver results more quickly and thoroughly than ever before following the global financial crisis of 2007/8 that saw many big international companies running into bankruptcy.

Among them was the Lehman Brothers, a 158-year investment bank in USA that was allowed by the US government to go bankrupt in September 2008.

After the Lehman Brothers fall, many other international companies received bailouts from governments, especially in USA, where the crisis started, through subprime mortgage and bailouts which spread to Europe and Japan.

Quality reports
In a speech read for him by the director of Economic Affairs, Mr Lawrence Kiiza, during the 5th financial reports award ceremony in Kampala recently, Finance minister Matia Kasaija said financial reports play a key role in the country’s economic policies.

“Further progress is needed in quality of financial reports and timeliness in the publication of annual financial reports of companies in this country,” he said.

Following the global financial crisis of 2007/8, and as a way of attracting public confidence in an organisation, companies are increasingly being compelled to provide accurate and reliable information faster and more efficiently.

Externally, stakeholders and regulators demand more transparent and reliable information in less time, and internally, business leaders require fast, accurate information to support smart, informed business decisions.

Mr Kasaija said following the global financial crisis companies should be transparent in financial reports that they produce to public. “There should be transparency in the information provided, trust and clarity in the financial report being published by various companies,” he said.
He added: “Regular and audited books of accounts should be made available by companies and right tax paid according to the tax laws in place.”

Capital Markets Authority chief executive officer, Keith Kalyegira said for a company to list on the Uganda Securities Exchange, it has to have a track record of audited financial reports of more than a year. “Audited books of accounts are one of the main requirements before a company is cleared to list shares in the stock exchange,” he said.

The awards
The 5th financial reporting awards that attracted 89 entities, saw Stanbic Bank Uganda taking the overall gold winner position followed by UMEME winning Silver and dfcu Bank that won bronze. Many other companies won awards as well as receiving certificates of recognition from the Institute of Certified Public Accountants of Uganda.

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