The Securities and Exchange Board of India (SEBI), on Tuesday, proposed companies to prepare an ‘Annual Information Memorandum’ (AIM), and suggested that top 200 listed companies, based on market capitalisation on the BSE or NSE as on March 31, 2014, disseminate AIM from financial year beginning on or after April 1, 2014.
All other listed companies have to circulate AIM from the financial year beginning on or after April 1, 2015. SEBI also said that AIM would be approved by board of directors at their meeting prior to its dissemination.
“It is felt that listed companies may be required to prepare an annual document where all the relevant information is available at one place,” said SEBI while circulating a discussion paper on AIM.
“The objective of AIM is to provide shareholders and prospective shareholders with accurate and relevant information about the financial and operating performance of the company. AIM will be comprehensive in nature and provide investors with detailed information at one place about the company, thereby assisting in making of informed investment decisions,” it added.
For companies which are planning initial public offers (IPOs), the requirement of AIM would commence with the IPO. This would require that the disclosures made by the companies at the IPO stage be updated on an annual basis so as to ensure that at any point of time updated information about them was available in public domain.
“The companies desirous of using AIM as draft offer document for future capital raisings shall be required to submit an auditor’s examination report along with AIM,” SEBI added. SEBI has invited public comments on its draft proposal which should be emailed to the regulator on or before March 9, 2014.