Progress seen in IPO checks, investigations

The China Securities Regulatory Commission (CSRC) has finished the process of verification, spot-checks and on-site inspections of IPO candidates' financial data, the commission told a news conference Friday.

The commission halted approvals of new IPOs in July 2012 amid widespread criticism that insufficient supervision over new public offerings had allowed poor-quality companies to enter the stock market.

Since then, the CSRC has ordered IPO candidates to conduct strict checks on their financial results, while also launching auditing inspections of its own.

"Since the end of 2012, when the CSRC initiated the financial checks, (IPO candidates) have gone through checks by third-party agencies, auditing and reporting of their own checks and random auditing inspections," the commission said.

The IPO candidates' self-check process was completed on May 31, the CSRC said. The commission's inspection departments have also given feedback during their random checks to the IPO candidates and third-party auditing agencies.

The CSRC said that according to a review of the self-check reports, it found that some IPO candidates violated rules when compiling financial data. Some firms failed to disclose information fully or "reported inaccurate information," the commission said.

The CSRC said it has reported firms that had severe "quality problems" with their IPO applications to related government departments, which will handle the cases according to the law.

Yin Zhongyu, general manager of the M&A Department of Great Wall Securities, told the Global Times Sunday that it is difficult to estimate when the moratorium on approvals of new IPOs will end.

"The CSRC will start clearing IPOs again only when the benchmark Shanghai Composite Index has stopped fluctuating and become more stable," he said. "I expect the commission to re-start IPO approvals when the index has stabilized between 2,300 and 2,500."

The Shanghai Composite Index reached 2,068.45 at close of trading Friday.