ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has initiated 38 show-cause proceedings against companies, auditors and directors for alleged violations of provisions of the Companies Ordinance, 1984.
Notices were issued by the Corporate Supervision Department (CSD) of the SECP in February 2016, said a statement issued by the SECP on Monday.
The violations included failure to comply with legal provisions in respect of holding annual general meetings, filing of interim accounts and delay in deposit of provident fund amount, discharge of duties by auditors, incorrect false statement in the accounts and non-compliance with commission’s directions etc.
The supervision department continued the strategy to focus on the quality of audits being performed by the statutory auditors and concluded 6 proceedings through orders against the auditor for not discharging their duties in line with applicable provisions and their failure to bring out material facts about affairs of companies as per Section 255 of the Ordinance.
Further new proceedings were also initiated against two auditors. Proceedings against three companies for apparently failing to deposit or invest employees’ provident fund amounts as per the requirements Companies Ordinance, 1984 were concluded through order and two new proceedings were initiated.
The department initiated three fresh proceeding against three companies for mis-statements and omission of material facts in their respective financial statements while one such proceeding was concluded through order.
The department also issued three orders authorising filing of winding up petition in courts by the registrar against three non-operating companies while proceedings against one non-operative company were initiated.
In two instances of misuse of powers by directors and unauthorised investments in associated companies, proceedings under section 196 and 208 of the ordinance were also started.
Moreover, notices were also issued to companies for non-maintenance of website and non-filing or late filing of annual and interim accounts.
The CSD also issued six directions to companies advising them to ensure compliance with the requirements of the ordinance as well as applicable accounting standards. Besides, 69 warning letters were issued to companies to ensure meticulous compliance of corporate and allied laws and applicable relevant accounting standards.
During the month, the CSD processed 88 complaints and resolved 66 matters with the entire satisfaction to the complainants. Moreover, 29 proceedings were also concluded through orders for various violations of the ordinance.
Published in Dawn, March 8th, 2016
