CSRC to introduce stricter accountability rules for cos/advisors

BEIJING (AFX-ASIA) - The China Securities Regulatory Commission has issued new regulations giving securities firms a bigger role in recommending companies raising funds through new share issues, but along with greater accountability for fraud or other irregulatiries, the China Daily reported.    They will face temporary suspension if they fail to discover incidences of fraud or are caught concealing irregularities in those companies, the report said, quoting the CSRC regulations.    The regulations reduce government interference and introduce more market-oriented practices into the process. Securities firms will have to "evaluate carefully" the quality of the applications, watch for possible insider trading and ensure the proper use of the fundsraised.     Accounting firms will also have to give objective reports of the financial status and internal control mechanisms of the companies, the paper said. Those who provide false profit forecasts will have to give "public explanations".     In future, listed companies who want to raise money through the issue of new shares will need to have a three-year dividend payment record. They must also disclose in their annual reports for three consecutive years how the money raised has been spent. 	    They will not be allowed to invest the money in financial institutions, i issue new shares will also have to have a three-year dividend payment record.

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