THE INVESTING PUBLIC

Otago Daily Times, Issue 22835, 20 March 1936, Page 10

THE INVESTING PUBLIC

GREATER PROTECTION ACTION IN AUSTRALIA '’United Press Association) (By Electric Telegraph—Copyright) MELBOURNE, March 19. (Received March 20, at 1.45 a.ra.) Important alterations in listing requirements are included in the recommendations of a conference of delegates of Stock Exchanges in Australia and New Zealand. A number of resolutions are designed to afford greater protection for the investing public and promote still further uniformity of practice. In regard to the mining company prospectuses, it is recommended that a prospectus shall be dated and signed and shall indicate for whom it is made. Any extract from the report shall be a fair representation of the full report. The prospectus shall contain a statement setting out any interest, direct or indirect, in the vendors’ or promoters’ consideration which a director, manager, or broker may have. The prospectus shall disclose particulars of the price at which any property, purchased or purchasable, has changed hands during two years preceding the issue, and the direct or indirect interest of directors, promoters, and others in such transactions. It shall disclose the payments to be made to vendors of areas under option, and particulars of royalty payments or total compensation to landholders or holders of leases. The conference considered that the practice of giving an option over unissued shares to vendors or promoters or persons other than cash subscribers was not in the best interest of shareholders and the mining industry. The conference resolved, that the existence of such an ontion may debar a company from being listed, ami that where such option exists a footnote shall be affixed to the company’s balance? sheet showing the number of shares under option, the price of issue, and the date on which the option expires. Another recommendation is that gold mining companies shall issue to Stock Exchanges and the press a complete financial statement quarterly. Mining reports for exchanges must include the time and date of information contained in the reports, while details of ernshings or any important mining development shall be telegraphed to all exchanges where shares arc listed. Such telegrams must be confirmed later by a detailed report. Fourteen days’ notice of a mining company’s meeting must be given, 11 days tor nominations for a board, and nine days in the case of a candidate nominated by directors. The company shall publish the total remuneration of all directors for the- period to which the accounts relate. Other recommendations deal with the control of subsidiary companies. The conference expressed disapproval of the unreasonable delay by_ some public companies in issuing their accounts, and expressed the opinion that in ordinary circumstances a local company should issue accounts three to four months after the close of the financial period. The conference felt it would be most difficult, if not impossible, to prevent the formation of companies unlikely to prosper, and the only deterrent would be adequate penalties for malpractices in flotations.