The Enforcement Department of the Securities and Exchange Commission of Pakistan (SECP) took action against 23 companies and two audit firms for violation of legal requirements in July 2005.
Out of these 25 companies, M/s Mehr Dastgir Textile Mills Limited was penalised for non-filling of quarterly accounts while its audit firm was penalised for giving inaccurate and misleading audit report for the year ended September 30, 2004. Both were penalised an aggregate fine of Rs 120,000. Similarly, legal proceedings were initiated against another audit firm for failure to comply with the provisions of the law.
Legal proceedings were initiated against 22 companies for non-compliance with statutory provisions, including unauthorised investments associated undertaking; lack of information and explanation in directors' report regarding observations contained in the audit report; failure to hold election of directors in accordance with laid down procedure; failure to issue shares within the prescribed period; investing funds of employees' provident fund in unauthorised listed securities; underwriting of the right issue by an ineligible person; non-maintenance of register of members; non-filing of quarterly accounts within prescribed period; and not appointing whole time company secretary.
Besides, two companies were directed to provide material information to the shareholders to enable them to make prudent and well informed decisions in general meetings.
During July 2005, the Enforcement Department resolved 224 out of 290 complaints of various shareholders, whereas comments on remaining 66 complaints have been sought from the concerned companies.
The complaints mainly related to non-receipt of dividend warrants, non-encashment of dividend warrants, delay/non-transfer of shares and issue of duplicate shares, non-receipt of annual and interim accounts, wrongful deduction of Zakat, and non-holding of AGM in order to facilitate companies and to promote efficiency in operations.
Eight companies were allowed to place their quarterly accounts on their respective websites instead of circulating them among shareholders by post.
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