Where an issuer includes pro forma financial information in any document (whether or not such disclosure of pro forma financial information is required under the GEM Listing Rules), that information must comply with rules 7.31(1) to (6) and a report in the terms of rule 7.31(7) must be included in the relevant document.
(1) The pro forma financial information must provide investors with information about the impact of the transaction the subject of the document by illustrating how that transaction might have affected the financial information presented in the document, had the transaction been undertaken at the commencement of the period being reported on or, in the case of a pro forma balance sheet or net asset statement, at the date reported. The pro forma financial information presented must not be misleading, must assist investors in analysing the future prospects of the issuer and must include all appropriate adjustments permitted by rule 7.31(6), of which the issuer is aware, necessary to give effect to the transaction as if the transaction had been undertaken at the commencement of the period being reported on or, in the case of a pro forma balance sheet or net asset statement, at the date reported on.
(2) The information must clearly state:
(a) the purpose for which it has been prepared;
(b) that it is prepared for illustrative purposes only; and
(c) that because of its nature, it may not give a true picture of the issuer's financial position or results.
(3) The information must be presented in columnar format showing separately the unadjusted financial information, the pro forma adjustments and the pro forma financial information. The pro forma financial information must be prepared in a manner consistent with both the format and accounting policies adopted by the issuer in its financial statements and must identify:
(a) the basis upon which it is prepared; and
(b) the source of each item of information and adjustment.
Pro forma figures must be given no greater prominence in the document than audited figures.
(4) Pro forma financial information may only be published in respect of:
(a) the current financial period;
(b) the most recently completed financial period; and/or
(c) the most recent interim period for which relevant unadjusted information has been or will be published or is being published in the same document;
and, in the case of a pro forma balance sheet or net asset statement, as at the date on which such periods end or ended.
(5) The unadjusted information must be derived from the most recent:
(a) audited published accounts, published half-year reports or published half-year or annual results announcements;
(b) accountants' report;
(c) previously published pro forma financial information reported on in accordance with rule 7.31(7); or
(d) published profit forecast or estimate.
(6) Any adjustments which are made to the information referred to in rule 7.31(5) in relation to any pro forma statement must be:
(a) clearly shown and explained;
(b) directly attributable to the transaction concerned and not relating to future events or decisions;
(c) factually supportable; and
(d) in respect of a pro forma profit or cash flow statement, clearly identified as to those adjustments which are expected to have a continuing effect on the issuer and those which are not.
(7) The pro forma financial information must be reported on in the document by the auditors or reporting accountants who must report that, in their opinion:
(a) the pro forma financial information has been properly compiled on the basis stated;
(b) such basis is consistent with the accounting policies of the issuer; and
(c) the adjustments are appropriate for the purposes of the pro forma financial information as disclosed pursuant to rule 7.31(1).
(8) Where pro forma earnings per share information is given for a transaction which includes the issue of securities, the calculation is to be based on the weighted average number of shares outstanding during the period, adjusted as if that issue had taken place at the beginning of the period.