Financial Market Council Reminder on Auditor Reporting Obligations
The Financial Market Council (CMF) has issued a reminder, in a statement, of the obligation for auditors of companies that make a public appeal for savings to inform the CMF of any facts that could jeopardize the interests of the company or its securities holders.
Situations Requiring Notification
The following situations are considered to require notification, on an indicative and non-exhaustive basis:
- Any significant violation of legislative, regulatory, or administrative provisions governing the company's activity
- The existence of a risk or serious doubt regarding the company's ability to continue operating
- Situations where auditors are unable to perform their duties, as provided for in Article 268 of the Commercial Companies Code
- Cases where the accounts are not approved, as defined in Article 269 of the Commercial Companies Code
- The issuance of a qualified opinion, particularly when it concerns the company's ability to continue operating or its long-term viability
- The existence of recurring or unaddressed reservations, persistent over two or more consecutive years, a manifest lack of provisions for major risks, or the failure to account for significant liabilities
- The occurrence of significant transactions with related parties under non-market conditions
Notification Procedure
The notification to the CMF by auditors is transmitted through any means that allows for a written record to be kept. When the reported facts relate to the issuance of a disclaimer of opinion or a qualified opinion, auditors are required to submit explanatory elements to facilitate understanding of the reported facts.
Expected Outcome
This reminder is expected to further improve the quality of financial information and lead to valuations that accurately reflect the prospects of companies listed on the stock exchange.
