ESG Reporting

Financial Reporting

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CPA, FCCA, CIA, CISA, CTA (HK)
Ricky is responsible for Risk Management Advisory and Environment, Social and Governance (ESG) advisory services in AVISTA.
Ricky has 20 years of experience in the fields of accounting, auditing, taxation, asset management, corporate finance and risk management. He has advised pre-IPO and listed clients in various industries, including property, financial services, TMT, manufacturing and licensed corporation, etc. Before joining AVISTA, Ricky had worked in Cheung Kong (Holdings) Limited, Ernst &amp; Young and KPMG in Hong Kong for few years.
Ricky has been invited to speak for the seminars and training of professional institutions such as, HKICPA, HKICS, HKiNEDA as well as those of various listed companies and professional training centers to share his valuable experiences in areas, including listing, risk management, internal control and ESG.

RICKY HO

Director

CPA, ACS, CTA(HK), CIA
Joey has profound experience in enterprise risk management, internal controls, financial due diligence and external audit.
Joey has more than 10 years’ experience in handling assignments of initial public offerings, resumption of trading and merger and acquisition exercises for listed companies. She has extensive experience in different industries including manufacturing and trading, property development and investment, financial services, money lending and provision of educational services.
Before joining AVISTA, Joey had worked for professional advisory firms and accounting firm with extensive experiences in providing accounting, auditing, risk advisory services for HK IPO listing companies and listed companies.

JOEY LEONG

Principal

CPA, CIA
Andrea has over 10 years experiences in the fields of corporate governance, due diligence, business consulting, risk management and internal control review. She has served clients in a range of industries, including garment and textile, licensed corporation, property, construction, automotive, pawn loan, travel and tourism, logistics, mining, energy, TMT, financial services, catering, healthcare, beauty and wastewater treatment etc.
Before joining AVISTA, Andrea had worked for professional advisory firms, accounting firm and multinational corporation with extensive experiences in providing accounting, auditing, risk advisory services for HK IPO listing companies and listed companies.

ANDREA KWAN

Newly-Released ESG Guide Consultation Conclusions and ESG Disclosure Review by HKEX

The Stock Exchange of Hong Kong Limited (“HKEX”) published a consultation paper titled ‘Review of Listing Rules Relating to Disciplinary Powers and Sanctions’ (the “Consultation Paper”) in August 2020, which proposed changes in respect of HKEX’s disciplinary regime. The Consultation Paper follows a wide-ranging review of the HKEX’s disciplinary powers and sanctions under Chapter 2A of the Listing Rules, to ensure that the disciplinary regime continues to remain robust and effective. The consultation period had ended on 9 October 2020.
 
The key enhancements to the existing disciplinary regime are set out below. 
<ol>
<li>Lowering existing thresholds for public statements regarding individuals Currently, the HKEX’s power to issue a public statement to the effect that a director continuing to remain in office is prejudicial to the interests of investors (“PII Statement”) can only be exercised where there has been a wilful or persistent failure by the director to discharge his responsibilities under the Listing Rules. The HKEX is proposing to remove this threshold as it is difficult in determining whether an action is wilful. This amendment will provide greater flexibility to the HKEX in being able to issue PII Statements against directors where warranted, without the need to prove that the director’s conduct is wilful or persistent. </li>
<li> Enhancing follow-on actions in relation to public statements regarding individuals and publication requirements Currently, the follow-on actions which the HKEX may direct where an individual subject to a PII Statement remains in office as a director are limited to suspension or cancellation of listing of the issuer’s securities or any class of its securities. In order to bring the compliance attitudes and cultures within listed issuers into sharp focus for the purpose of benefitting the investing public, the following enhancements are proposed in case of serious misconduct: (a) The follow-on actions which the Listing Committee or the Listing Review Committee may direct include the denial of facilities of the market to that listed issuer for a specified period; and (b) The follow-on actions apply where an individual subject to a PII Statement continues to be a director or senior management member of the specified listed issuer. The HKEX also proposes that, after a PII Statement with follow-on actions has been made against an individual, the listed issuer identified in the statement must include a reference to the PII Statement in all of its announcements and corporate communications, unless and until that individual is no longer a director or a senior management member of the relevant listed issuer. </li>
<li>Introducing director unsuitability statements For more serious cases of misconduct where there is a evident or repeated failure by a director to discharge his responsibilities, the HKEX is proposing a new sanction, which would enable it to issue a public statement that, in its opinion, the director is unsuitable to occupy a position as a director or within the senior management of a named listed issuer or any of its subsidiaries. </li>
<li>Introducing secondary liability The HKEX is also proposing to introduce secondary liability for Listing Rule breaches in circumstances where it determines the person “has caused by action or omission or knowingly participated in a contravention of the Listing Rules”. These persons may include directors and senior management, substantial shareholders, professional advisers and their employees, authorised representatives, supervisors and a guarantor of an issuer in the case of a guaranteed issue of debt securities or structured products. Set out below are some examples of how secondary liability would be applied: (a) Chief Financial Officers for failure to obtain auditors’ agreement before publication and material inaccuracy of preliminary results announcement; (b) Chief Operating Officers for failure to disclose share charge in a timely manner and in its interim report; (c) Company Secretaries for material inaccuracy of listed issuer’s announcement of controlling shareholder’s transfer of shares; (d) Substantial Shareholders for breach of maintain minimum public float; (e) Financial Advisers for material inaccuracy of listed issuer’s Circular.</li>
</ol>
 
We believe the proposed enhancements could further enable the HKEX to take timely and effective disciplinary actions, which in turn promote market quality and maintain the integrity of the Hong Kong capital market.

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HKEX Consultation Paper on ‘Review of Listing Rules Relating to Disciplinary Powers and Sanctions’

The Cayman Islands Government introduced the <a href="https://www.cima.ky/upimages/commonfiles/PrivateFundsLaw2020_1581524961.PDF" target="_blank" rel="noopener">Private Funds Law, 2020</a> and the <a href="https://www.cima.ky/upimages/commonfiles/PrivateFundsSavingsandTransitionalProvisionsRegulations2020_1581526431.PDF" target="_blank" rel="noopener">Private Funds (Savings and Transitional Provisions) Regulations, 2020</a> (together as the “New Cayman Law”) in February 2020. One of the key highlights of the New Cayman Law is the mandatory enhancements over the independency and consistency of the valuation process in relation to the assets of private funds.
 
The operator of the private funds shall be responsible for compliance with the New Cayman Law.
 
Effective Period of the New Cayman Law 
 
A transitional period of 6 months was granted, implying that the private funds should be fully aware of the latest code arrangements and have prepared adequate compliance mechanisms in order to comply with the New Cayman Law by no later than 7th August 2020. The degree of compliance to the New Cayman Law will most probably be assessed from the financial year of 2020 onwards.
 
 Valuation Requirements under the New Cayman Law 
 
Under the New Cayman Law, private funds, which cover the majority of the closed-ended funds, are obligated to follow proper and consistent procedures to perform valuations on its assets.
 
In any case, the valuation of assets is required to be conducted at least annually. It shall be carried out at a rate that is appropriate and necessary to timely reflect the material changes on the fair value of the subject asset.
 
The Cayman Law explicitly stated that the appraisal should be performed by one of the followings:
 
<ol style="list-style-type: lower-roman;">
<li>An independent third party that is professionally qualified to conduct valuations in a non-high-risk jurisdiction; </li>
<li>The manager or operator of the private funds provided that: (a) The valuation function is independent from the management function of the funds; or (b) Potential conflicts of interest are appropriately addressed and disclosed to the investors of the private funds; </li>
<li>An administrator appointed by the private funds.</li>
</ol>
 
How AVISTA Can Help
 
One of the key takeaways of the New Cayman Law is the great emphasis on the independence and professoinalism of the valuation of assets, in order to provide the investors with a true and fair view of the value of the funds. Privates funds are required to conduct valuation of the assets at least annually with a rigorous and consistent approach in accordance with the rules and guidelines set forth in the Monetary Authority Law (2020 Revision).
 
As one of the leading independent professional valuation firms, AVISTA is experienced in valuing different types of equity investments and financial instruments with complex structure for financial reporting purpose. Our valuation experts are ready to advise you on how the assets in the funds can be valued for compiling your upcoming audited accounts under the new requirements in a cost effective manner.
 
For further information or enquiries regarding the potential valuation impact of the New Cayman Law to you, please feel free to contact us.

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The New Cayman Law Imposed Further Valuation Requirements for Cayman Private Funds 

The spreading of pandemic remains unpredictable, which continues to dampen investment activities and lead to office size decreasing and office downgrading, etc. In this publication, AVISTA Property Consultancy has covered the outlook of the Hong Kong office market, our insights on the market with reference to selected local offices’ sale and leasing transactions in Q2 2020 as well as our thoughts on the relaxation of mortgage loans on non-residential properties by HKMA and commercial land supply in 2020-2021.
 
Please click <a href="../../../../../uploads/AVISTA_HK_Office_Market_Insights_-_The_Office_market_is_likely_to_remain_under_pressure_EN_v3_ac05b413c0.pdf" target="_blank" rel="noopener">here</a> to read the insights.
 
<a href="../../../../../uploads/AVISTA_HK_Office_Market_Insights_-_The_Office_market_is_likely_to_remain_under_pressure_EN_v3_ac05b413c0.pdf" target="_blank" rel="noopener"><img src="../../../../../uploads/eng_cover_1_3802422a17.png" width="600" height="848" /></a>