Under clause 24(2) of the Public Sector Companies (Corporate Governance) Rules, 2013 (the Rules), external auditors of the company, are required to review the statement of compliance before its publication and certify its compliance through review report to the members, as set out in Schedule III to the Public Sector Companies (Corporate Governance Compliance) Guidelines, 2013 (the Guidelines):
The SECP has recently revised the Guidelines by revising the format of the review report on statement of compliance from the auditors to the members as specified vide Schedule III. This has been revised in the light of recommendations received from the Institute of Chartered Accountants of Pakistan.
The revised format contains explanation of responsibility of the auditor as well as the management of public sector companies. There are certain public sector companies who are also listed and are subject to the requirements of both the Code of Corporate Governance, 2012 as well as the Rules. Therefore, separate review reports for listed and unlisted Public Sector Companies have also been specified.
Moreover, the review report has been revised to provide for issuance of clean and modified report. Clean review report will be issued where management has accepted and disclosed the non-compliances in the statement of compliance, whereas, modified report will be issued where managements of public sector companies have either not accepted or disclosed the fact of non-compliance with the provisions of the relevant framework.
The revised guidelines are accessible on SECP website through the following links:
Members are advised to take note of the above.