The CoVID-19 pandemic and the consequent lockdown restrictions imposed by national governments has impacted businesses not only in India but all over the world . In view of the same, SEBI has granted several relaxations to the listed entities in terms of timelines for filing of various reports/ disclosures under LODR Regulations.
Regulation 30 of SEBI LODR Regulations deal with the disclosure requirement by the listed entities to the stock exchanges, of all the events that are specified in Para B of Part A of Schedule III of SEBI LODR regulations. Lots of companies have already made disclosure on stock exchanges, regarding shut down of its operation, resumption of its operation and other disclosure related to Covid-19.
However, market regulator is of the view that above disclosures by the listed entities, does not display the impact of Covid-19 on the Company’s performance and financials, at a large.
Vide its Circular No. SEBI/HO/CFD/CMD1/CIR/P/2020/84 dated May 20, 2020, SEBI has issued an advisory note on Regulation 30 of SEBI LODR Regulations, 2015, providing illustrative list of information that should be disclosed to stock exchanges by the Company.
Those are:
- Impact of the CoVID-19 pandemic on the business;
- Ability to maintain operations including the factories/units/office spaces functioning and closed down;
- Schedule, if any, for restarting the operations;
- Steps taken to ensure smooth functioning of operations;
- Estimation of the future impact of CoVID-19 on its operations;
- Details of impact of CoVID-19 on listed entity’s
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- capital and financial resources;
- profitability;
- liquidity position;
- ability to service debt and other financing arrangements;
- assets;
- internal financial reporting and control;
- supply chain;
- demand for its products/ services;
- Existing contracts/agreements where non-fulfilment of the obligations by any party will have significant impact on the listed entity’s business;
- Other relevant material updates about the listed entity’s business.
The above list is only illustrative and not exhaustive. Further, to have continuous information about the impact of CoVID-19 on operations, listed entities may provide regular updates, as and when there are material developments
Additionally, while submitting financial statements under Regulation 33 of the LODR, listed entities may specify/include the impact of the CoVID-19 pandemic on their financial statements, to the extent possible
This Circular shall come into force with immediate effect. The Stock Exchanges are advised to bring the provisions of this circular to the notice of all listed entities and also disseminate the same on their websites.
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Practicing Company Secretary, M.Com and Commerce Graduate and founder at Shaffy Mehta & Co. She is having an overall 4 years experience of Company Law and other Corporate Laws.