Chalee Chantanayingyong, SEC Deputy Secretary-General said that “Previously, expected timing of the SEC approval for securities offering or fund establishment as well as projected profits of listed companies resulted from the fund establishment have been covered by the media. It is therefore important to clarify that approval for any securities offering or fund establishment will be certain only when the applicants receive the SEC’s official letter. Information on the approval can be found on the SEC website – www.sec.or.th; under topics “Weekly News” for securities issuance and offering, and “Mutual Fund Report and Prospectus System (MRAP)” for fund establishment.
Listed companies’ asset disposition to property fund, infrastructure fund or real estate investment trust (REIT) may impact their future revenue structure and obligations. Also, certain terms and conditions in the relevant agreements may give rise to accounting issues; in particular, whether such transaction could be recorded as true sale or borrowing, the difference of which significantly affect corporate operating results in terms of profit-loss or liability in each accounting period. After filing the application for fund establishment, additionally, proposed structures and details could be changed at anytime; as such the potential impact can actually be assessed when the company reaches conclusion on proper structure or the SEC approves fund establishment.
In this regard, the SEC urges investors to be cautious in making use of news coverage on securities offering or fund establishment and listed companies’ profit forecast, if it has not approved by the SEC or not reached conclusion on how asset disposition would impact the listed companies’ financial statements. If, furthermore, the transactionis not regarded as true sale, not only no profit will be recorded, liability of listed company will rise.”
“Investment analysts must adhere to professional standards and exercise due care when giving advice or opinion with impact on investment decision. Their opinion should be given based on clear and accurate information. With uncertainty, investment analysts’ view must cover both best and worst case scenarios, to prevent investors’ unreasonable expectation. For listed companies or executives, news release or media interview should be given when the SEC approval has been obtained and accounting issue has been concluded. Giving new release or interview concerning projected profit should also be avoided while accounting aspect of the transaction remains unclear as it could affect company share price and constitute a violation of securities law,” Chalee added.