Bourses asked to appoint auditors in one month
BI Report || BusinessInsider
Logos of DSE and CSE
The Bangladesh Securities and Exchange Commission (BSEC) has directed the country’s two bourses to appoint special auditors within the next one month to monitor the activities of the capital market after demutualisation.
In addition, the regulatory body has directed the Dhaka Stock Exchange (DSE) and the Chittagong Stock Exchange to prepare a specific work plan and related laws or regulations for listing of two bourses in the capital market and submit to the BSEC by January 10.
The commission issued the directive in a letter to the managing directors (MDs) of the two stock exchanges on Sunday.
The letter from the BSEC said that it would be up to the special auditor to ascertain whether the ongoing activities of the stock exchanges, the code of conduct, the practice of ethics, etc were being conducted in accordance with the demutualisation laws and regulations.
After the appointment, the auditor will check whether the overall activities of the capital market after demutualisation are being conducted properly.
The two capital markets will appoint an audit firm and will have to get BSEC approval for its work.
The Dhaka and Chittagong stock exchanges were demutualised eight years ago. However, the two stock exchanges failed to implement any of the 12 plans, including raising the average transaction to Tk 2,500 crore and increasing the participation of foreign investors to 30 percent.
According to special BSEC report, the two were separated so that ownership and management could function independently as separate departments.
But not even a speck of it has been implemented. The owners are still watching over the management officials.
The number of independent directors on the board of directors has increased since the demutualisation. But they are not able to exercise power.
One of the main objectives of demutualisation was to ensure good governance in the management of stock exchanges. But that also did not happen.
The specific goal of demutualisation was to make the stock exchange profitable. But instead of increasing profits, the two stock exchanges are still struggling.
The board of DSE has declared a 4-percent dividend only for the shareholders for the recent year.
The situation in CSE is more delicate. It has yet to bring in strategic investors. The demutualisation of the stock exchange has been done only on paper.
