Taiwan SFC investigates listed IT firms

The Inquirer ^ | July 17, 2002 | INQUIRER staff

[JameRetief]

Taiwan SFC investigates listed IT firms

Inventory padding and the like

By INQUIRER staff: Wednesday 17 July 2002, 09:36

A REPORT IN financial newspaper the Economic News said that the Taiwanese Securities & Futures Commission is to start an investigation into IT firms listed on the local bourse, Taiex.

The newspaper says the SFC is acting to see whether high tech firms are "doctoring" their accounts.

The move follows similar investigations by the SEC in the US, but it seems the Taiwanese body may dig deeper than some IT firms would like.

The reason for the investigations in Taiwan is because of the close connections many local outfits have with large US computer companies.

The paper says that analysts and accountants on the island think that "many companies" in Taiwan might "cheat investors".

And some auditors may have colluded with "unscrupulous" CEOs.

The Taiex has taken steps in the last few years to prevent some practices. For example, trading lasts a far shorter period than on exchanges like the NASDAQ, while if share prices show unusual fluctuations either upwards or downwards, the particular stock is suspended on the spot. µ