XN000022-1988-06-22 — Page 47

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WEDNESDAY, JUNE 22, 1988

SECTION

"THE STANDING COMMITTEE HAS RECOMMENDED AMENDMENTS ΤΟ SECTION 141D OF THE COMPANIES ORDINANCE. THAT

PROVIDES THAT WHERE ALL THE SHAREHOLDERS OF A PRIVATE COMPANY AGREE, THE NORMAL PROVISIONS REGARDING THE COMPANY'S ANNUAL ACCOUNTS,

+ DIRECTORS REPORT AND AUDITORS' REPORT SHALL NOT APPLY.

"INSTEAD THE COMPANY'S BALANCE SHEET HAS TO COMPLY WITH MUCH SIMPLER REQUIREMENTS AND THE AUDITOR'S REPORT DOES NOT PROFIT AND LOSS ACCOUNT AT ALL," THE SPOKESMAN SAID.

COVER THE

CONSIDERATION ACCOUNTANTS,

**THE STANDING COMMITTEE, AFTER TAKING INTO REPRESENTATIONS MADE BY THE HONG KONG SOCIETY OF RECOMMENDS THAT SECTION 141D BE AMENDED TO REQUIRE THE AUDITORS ΤΟ REPORT ON WHETHER THE ACCOUNTS SHOW A TRUE AND FAIR VIEW ON THE BASIS OF THE DISCLOSURE EXEMPTIONS PERMITTED UNDER THE SECTION, AND TO EXTEND THE REFERENCES TO THE COMPANY'S BALANCE SHEET IN THE SECTION TO INCLUDE THE COMPANY'S PROFIT AND LOSS ACCOUNT, HE ADDED.

THE SPOKESMAN POINTED OUT THAT ADMINISTRATIVE DIFFICULTIES AROSE IN HANDLING THE REGISTRATION OF OVERSEAS COMPANIES DOMICILED IN JURISDICTIONS WHICH DID NOT HAVE A COMPANIES REGISTRY AND WBRE THEREFORE UNABLE TO PRODUCE A CERTIFICATE OF INCORPORATION.

"TO OVERCOME THIS PROBLEM, THE STANDING COMMITTEE RECOMMENDS THAT THE REGISTRAR GENERAL SHOULD BE GIVEN A STATUTORY DISCRETION TO ACCEPT INSTEAD, FOR THE PURPOSES OF SECTION 333 OF THE ORDINANCE, SUCH OTHER DOCUMENT AS ESTABLISHES TO HIS SATISFACTION THAT A COMPANY IS DULY INCORPORATED IN AN OVERSEAS JURISDICTION, HE ADDED.

THE STANDING COMMITTEE ALSO MADE A NUMBER OF FOR AMENDMENTS OF A TECHNICAL NATURE.

RECOMMENDATIONS

APART FROM THESE, IT CONSIDERED A NUMBER OF IMPORTANT ISSUES INCLUDING THE APPOINTMENT OF AUDIT COMMITTEES, PROHIBITION OF PROVISION OF FINANCIAL ASSISTANCE BY A COMPANY FOR THE PURCHASE OF ITS OWN SHARES, THE DOCTRINE OF ULTRA VIRES, CERTAIN ASPECTS OF FLOATING CHARGES, GENERAL PROVISIONS AS TO THE CONTENTS AND FORMS OF ACCOUNTS AND LOANS TO DIRECTORS.

"CONSIDERATION OF THESE ISSUES IS STILL CONTINUING,

SPOKESMAN SAID.

THE

REPORT

MEMBERS OF THE PUBLIC WHO WISH TO OBTAIN A COPY OF THE SHOULD WRITE TO THE SECRETARY TO THE STANDING COMMITTEE ON COMPANY LAW REFORM, REGISTRAR GENERAL'S DEPARTMENT, COMMERCIAL DIVISION AT QUEENSWAY GOVERNMENT OFFICES.

"MEMBERS OF THE PUBLIC INTERESTED IN THE SUBJECTS COVERED IN THE MAIN TEXT OF THE REPORT ARE INVITED TO SUBMIT COMMENTS IN WRITING TO THE SECRETARY FOR MONETARY AFFAIRS AT ADMIRALTY CENTRE, TOWER II, 24TH FLOOR, HONG KONG, NOT LATER THAN SEPTEMBER 1, 1988, HE ADDED.

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