Versions

 

LD104-1

View Current PDFView Current PDF

HKEx LISTING DECISION
HKEx-LD104-1 (September 2010)

Parties Company A — a Main Board issuer

Mr. X — Company A's proposed independent non-executive director
Issue Whether Mr. X was qualified to act as Company A's independent non-executive director having appropriate professional qualifications or accounting or related financial management expertise
Listing Rules Main Board Rule 3.10(2)
Decision Mr. X was qualified to act as Company A's independent non-executive director under Rule 3.10(2)

FACTS

1. Company A proposed to appoint Mr. X as an independent non-executive director.
2. It submitted that Mr. X had the professional qualifications and accounting expertise required under Rule 3.10(2) because:
a. He was a certified public accountant in the Mainland.
b. He had worked as a principal accountant in a firm of certified public accountants in the Mainland (Mainland CPA firm) for 7 years and thereafter as a partner at another Mainland CPA firm for 8 years. He was the auditor-in-charge at a company listed on a stock exchange in the Mainland.

APPLICABLE LISTING RULES

3. Rule 3.10(2) states that:
at least one of the independent non-executive directors must have appropriate professional qualifications or accounting or related financial management expertise.
Note: With regard to "appropriate accounting or related financial management expertise", the Exchange would expect the person to have, through experience as a public accountant or auditor or as a chief financial officer, controller or principal accounting officer of a public company or through performance of similar functions, experience with internal controls and in preparing or auditing comparable financial statements or experience reviewing or analysing audited financial statements of public companies. It is the responsibility of the board to determine on a case-by-case basis whether the candidate is suitable for the position. In making its decision, the board must evaluate the totality of the individual's education and experience.

ANALYSIS

4. The Exchange accepted that Mr. X fulfilled Rule 3.10(2). Mr. X's qualification as a certified public accountant in the Mainland and experience in accounting and auditing in the Mainland were relevant for considering his suitability to act as Company A's independent non-executive director under Rule 3.10(2).

CONCLUSION

5. Mr. X was qualified to act as Company A's independent non-executive director under Rule 3.10(2).