WEDNESDAY, NOVEMBER 27, 1974
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THEREFORE, HE SAID, IT WAS SUGGESTED THAT, IN ALL SUCH CASES, AUDITORS DE REQUIRED TO REPORT IN POSITIVE TERMS WHETHER THE ACCOUNTS GAVE A TRUE AND FAIR VIEW ON THE BASIS THAT THE ACCOUNTS HAD BEEN PREPARED IN ACCORDANCE WITH THE RELEVANT PROVISIONS OF THE COMPANIES ORDINANCE.
COMMENTING ON ANOTHER PROVISION OF THE BILL UNDER WHICH CERTAIN PRIVATE COMPANIES MAY BE EXEMPTED FROM MOST OF THE NEW REQUIREMENTS, MR. LEE SAID IT SEEMED IRONICAL THAT CERTAIN PRIVATE COMPANIES WERE GIVEN EXEMPTIONS WHILE THE PRIME OBJECT OF THE BILL WAS TO RAISE THE GENERAL STANDARD OF ACCOUNTING.
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HE SAID +AS ALL COMPANIES, WHETHER PUBLIC OR PRIVATE, ENJOY LIMITED LIABILITIES, IT IS NOT UNREASONABLE THAT, IN RETURN FOR SUCH PRIVILEGE, THEY SHOULD COMPLY WITH THE UNIFORMED REQUIREMENTS SUCH AS NOW PROVIDED IN THE BILL.+
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BUT HE ADDED THAT IT HAD BEEN SUGGESTED THAT CONSIDERATION SHOULD AT THE SAME TIME BE GIVEN TO THE FACT THAT THERE WERE MANY PRIVATE COMPANIES IN HONG KONG WITH ONLY SMALL FAMILY. TYPE BUSINESS.
+THE APPLICATION TO THEM OF FULL REQUIREMENTS WOULD SERVE NO USEFUL PURPOSE BECAUSE OF THE NATURE OF THEIR ORGANIZATION AND BUSINESS, MR. LEE POINTED OUT.
FURTHERMORE, PRIVATE COMPANIES ARE NOT REQUIRED TO FILE ACCOUNTS WITH THE REGISTRAR OF COMPANIES- CONSEQUENTLY THEIR ACCOUNTS ARE NOT ACCESSIBLE TO THE PUBLIC.
HOWEVER, IN ORDER NOT TO INFRINGE ON THE INTEREST OF THE GENERAL PUBLIC, MR. LEE SAID, FOR THOSE PRIVATE COMPANIES WHOSE NATURE OF BUSINESS IS SUCH THAT LIABILITIES ARE NECESSARILY INCURRED FROM THE PUBLIC, IT IS IMPORTANT THAT THEY SHOULD NOT BE ALLOWED TO AVAIL THEMSELVES OF THE ADVANTAGE OF EXEMPTION.+
THEREFORE, IT WAS PROPOSED THAT BANKING COMPANIES, DEPOSIT-TAKING COMPANIES, INSURANCE COMPANIES, INTERNATIONAL CARGO-CARRYING COMPANIES AND STOCK BROKING COMPANIES SHOULD BE DENIED THE EXEMPTION, AS SHOULD A PRIVATE COMPANY WITH A SUBSIDIARY OR A COMPANY WHICH IS THE SUBSIDIARY OF ANOTHER BODY CORPORATE.
THE HON. LI FOOK-WO ALSO SPOKE ON THE BILL AND COMMENTED ON TWO ISSUES WHICH HE FELT WERE WORTHY OF CONSIDERATION.
THESE WERE +OWNERSHIP INFORMATION+ AND THE PLACE WHERE BOOKS OF ACCOUNT ARE KEPT.+
ON THE FIRST ISSUE, HE POINTED OUT THAT IN THE MODERN FINANCIAL WORLD +IT IS NOW GENERALLY RECOGNISED THAT SECRECY AND PUBLIC OWNERSHIP OF COMPANIES CANNOT EXIST TOGETHER.+
MR. LI SAID : +INFORMATION ABOUT MAJOR SHAREHOLDINGS IS ESSENTIAL INVESTMENT INFORMATION AT LEAST AS IMPORTANT ABOUT THE COMPANY'S HISTORICAL PROFITS. WITHOUT IT, THE INVESTOR OR POTENTIAL INVESTOR CANNOT ASSESS THE TRUE SIZE AND NATURE OF THE MARKET IN THE SHARES OR THE EXTENT TO WHICH THE COMPANY'S POLICIES MIGHT BE INFLUENCED BY PRESSURE GROUPS.+
HE FURAHIR