Thursday, July 13, 2017
FINANCIAL INFORMATION TRANSPARENCY
1) Financial Calendar
2) Listing of Shares in Stock Exchange
3) Details of Shareholders/ Shares
4) International Listing
5) Stock Market Data (Share Price Volatility)
6) Share Transfer Process
7) Dividend Payment
8) Special Resolution by Postal Ballot
In all the companies disclosure of financial calendar include following data:
•Financial Calendar •Date, Time and Venue of Last Annual General Meeting •Book Closure Date •Dividend Payment Date •Date of Posting of Annual Report •Last Date of Receipt of Proxy forms •Approval Date of Quarterly Results •Stock Code •Special Resolution of Postal Ballot •Reporting on Conciliation of Account GAAP •Board Meeting Date •Probable Date of Dispatch of Warrants for Dividend
Listing means admission of securities to dealings on a recognized stock exchange. The securities may be of any public limited company, Central or State Government, quasi-governmental and other financial institutions/corporations, municipalities, etc.
The objectives of listing are mainly to:
• Provide liquidity to securities;
• Mobilize savings for economic development;
• Protect interest of investors by ensuring full disclosures.
Following details of shareholders/shares are disclosed in sampled companies include:
• Name of Investors/Shareholders
• Number of shares and number of Shareholders
• Percentage of total shares and total Shareholders
• Percentage of Share Capital
• Amount of Shareholding
• Shareholding of Nominal Value
• Number of Shares held in demat form
GDR (Global Depositary Receipt):
A global depositary receipt (GDR) is a bank certificate issued in more than one country for shares in a foreign company. The shares are held by a foreign branch of an international bank. The shares trade as domestic shares, but are offered for sale globally through the various bank branches.
A financial instrument used by private markets to raise capital denominated in either U.S. dollars or Euros.
ADR (American Depositary Receipt):
An American depositary receipt (ADR) is a negotiable certificate issued by a U.S. bank representing a specified number of shares (or one share) in a foreign stock that is traded on a U.S. exchange. ADRs are denominated in U.S. dollars, with the underlying security held by a U.S. financial institution overseas. ADRs help to reduce administration and duty costs that would otherwise be levied on each transaction. This is an excellent way to buy shares in a foreign company while realizing any dividends and capital gains in U.S. dollars. However, ADRs do not eliminate the currency and economic risks for the underlying shares in another country. For example, dividend payments in Euros would be converted to U.S. dollars, net of conversion expenses and foreign taxes and in accordance with the deposit agreement. ADRs are listed on the NYSE, AMEX or Nasdaq as well as OTC.
Volatility is a statistical measure of the dispersion of returns for a given security or market index. Volatility can either be measured by using the standard deviation or variance between returns from that same security or market index. Commonly, the higher the volatility, the riskier the security. Stock price volatility is an indicator that is most often used by options traders to find changes in trends in the market place. There are two main types of stock volatility including Historical Volatility and Implied Volatility that are used in the options markets. The increase or decrease in volatility results from changes in investors emotions in the market place. More specifically greed and fear in the market place are the two main factors that cause stock prices to change. Stock price volatility tends to rise when there is new information released in the markets however the extent to which it rises is determined by the relevance of that new information as well as to the degree in which the news surprises investors.
The shares of a company are movable property and are generally freely transferable. Though there might be certain restrictions on transfer of shares of private companies provided in the articles of the company, such restrictions are generally added to protect the rights of one set of investors or the shareholders. However, shares of a public company are always freely transferable. Here, researcher has taken 3 aspects of share transfer process which are normally disclosed in sampled companies.
• Shares in physical form
• Share transfer is allotted agent
• Time period for share transfer process
Power of refusal to register transfer of shares is to be exercised by the company within thirty (30) days from the date on which the instrument of transfer or the intimation of transfer, as the case may be is delivered to the Company.
The term ‘dividend’ has been defined under Section 2(35) of the Companies Act, 2013. The term “Dividend” includes any interim dividend. It is an inclusive and not an exhaustive definition. According to the generally accepted definition, “dividend” means the profit of a company, which is not retained in the business and is distributed among the shareholders in proportion to the amount paid-up on the shares held by them.
Applicable for E-Voting:
• Every listed company or
• A company having not less than one thousand shareholders shall provide to its members facility to exercise their right to vote at general meetings by electronic means.
• E-Voting Period:
• The e-voting shall remain open for not less than one day and not more than three days.
• In all such cases, such voting period shall be completed three days prior to the date of the general meeting.
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