Speakers at a seminar have stressed the need for adopting cautious approach by the media while reporting financial issues having direct impact on stock exchanges, financial institutions, banking sector and regulatory bodies including Securities and Exchange Commission of Pakistan (SECP).
The seminar was jointly organised by South Asian Federation of Exchanges (Safe) and Friedrich Naumann STIFTUNG (German NGO) titled "Financial Literacy Initiative-Pakistan" for media here on Thursday. During question-answer session, a leading lawyer and legal practitioner Ahmad Hassan shared global practices of financial reporting of regulatory bodies and explained concepts of 'insider trading,' 'wash trade' and blank sales' etc at the stock exchanges. The international law cases, globally recognised scams unearthed by regulators and reports on organised frauds and financial crimes, highlighted by Hassan, were highly appreciated by the representatives of print and electronic media.
In his detailed presentation, Aftab Ahmed Chaudhary Secretary Safe said that in-depth knowledge of issues relating to stock exchanges, financial institution etc is necessary for accurate reporting on financial issues in the capital markets. The enforcement orders of the SECP against the corporate sector needs proper study to know about the rationale behind the penalty imposed on any undertaking, he said.
He was of the view that some of the enforcement orders of he SECP have direct impact on the general investors, which needs to be highlighted by media. The media must focus on creating general awareness for the investors and shareholders to protect them from any losses.
In many cases, the SECP orders talks about non-compliance of Companies Ordinance 1964 by companies which resulted in major affect on the investors as well as general public, therefore, the media should be cautious while highlighting such issues, Aftab added. According to him proper publication of the SECP orders would help the investors and stakeholders of the companies to take precautionary measures before investing into any specific undertaking.
He said that financial literacy is a must for all those involved in financial markets, financial institutions and regulatory bodies and for the purpose Safe has started financial literacy initiative in Pakistan in the aftermath of the financial crisis of 2005.
He maintained that after the financial crises of 2005 financial literacy and education issues have acquired a momentum, adding more efforts are needed for creating awareness among the shareholders of public limited companies, on the issue so that each shareholder of any company could know about his rights and duties. Policy makers world-wide now increasingly acknowledge the importance of financial literacy both as a life skill and as a key component of financial and economic stability and development, Aftab said.
He said that Safe acknowledging the importance of better financial education and literacy for improving the ability of people to use financial services; to make effective decisions with respect to their present and future welfare; and to respond to growing concerns over adverse affects of low financial literacy levels; a comprehensive and high-level project on financial literacy has been developed to cover a wide spectrum of connected issues.
Ahmad Hassan, Partner Hassan Kaunain Nafees, Legal Practitioners and Advisors highlighted the role of regulators in facilitation of investors and checking wrong practices by certain companies through enforcement actions. He quoted different international cases where financial irregularities have been highlighted by media. While reporting financial issue, the legal aspects needs to be analysed for presenting accurate picture of the relevant financial sector.
Referring to capital markets and financial institutions, he explained that the biggest advantage of financial reporting is that every time there is a new record made in stock market or any other financial transactions involved, top lawyer added.
Ayla Majid Co-ordinator Financial Literacy Programme presented a detailed different between the sales tax law and Value Added Tax (VAT) and its implications on the business and trade. She particularly highlighted the implications of the withdrawal of zero-rating facility under the reformed general sales tax (RGST). Shaista Kiran Project Co-ordinator Friedrich Naumann STIFTUNG (German NGO) gave a detailed presentation on the role of international NGOs in facilitating people of the country.