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Thursday, May 19, 2005

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Review of quarterly reporting ruled out

Our Bureau

New Delhi, May 18

Mr Damodaran ruled out any changes to the current system of quarterly reporting of earnings by corporates.

"I don't think we can go back on the current system of quarterly reporting of results. If we do that the signal would be far too negative. Even though the boards may have more time for discussing strategic issues, the negative would be far too much. People would read more into it than what we would expect them to do", Mr Damodaran said.

The Sona Koyo Steering Systems Chairman, Mr Surinder Kapur, and the Bharti Enterprises Chairman, Mr Sunil Mittal, sought to make a case for review of the current system. It was felt that this requirement prevented the board from concentrating on strategic issues.

Mr Mittal also held that foreign directors were often not very enthusiastic about coming to India merely to attend meetings on quarterly results. He held that the main issue was the insistence on "physical meetings" of the board of directors in India. "The main issue is can we do without physical meetings?" he said.

The SEBI Chairman, however, held that this issue could be resolved by having more board meetings in a year. He also suggested that companies with large boards could tide over this situation by referring the work on strategy to committees of the board.

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