Guide

PN17 GN3
Publish Date: 09-11-2018Updated On: 30-11--0001




Beside the situation that related to shareholder equity, a company will trigger PN 17 or GN 3 as long as the experience the situation as stated below:
- 50% of total assets are under receivership
- Subsidiary that makes up more than 50% of total asset is winding up
- Adverse or disclaimer opinion by auditor
- Auditor express an emphasis of matter on going concern and shareholder equity is less than 50% of issued and paid-up capital
- The company default in its payment
Adverse Opinion: Financial records are not in accordance to accounting standards or grossly misstated
Disclaimer Opinion: Auditor do not provide any opinion due to absence of financial records or insufficient cooperation from management
Emphasis of matter on going concern: Uncertainty on whether the company will survive
Obligation of PN17/ GN3 companies
When a company hits the criteria of being a PN17/ GN3 company, they have to announce to the exchange immediately. The below is a timeline of what a company should do when it became a PN17/GN3 company.
If the PN 17 firm plans to change its business direction or policy
- Announce a regularization plan within the first 3 months
- Submit the regularization plan to Securities Commission (SC) for approval within 12 months from the First Announcement
- Update the status of regularization plan on a monthly basis
- Complete the plan within the time frame prescribe by SC
If the PN 17 firm does not plan to change its business direction or policy
- Announce a regularization plan within the first 3 months
- Submit the regularization plan to the exchange for approval within 12 months from the First Announcement
- Complete the regularization plan within 6 months from the time the plan being approved. Cases that involve court proceedings are being given a time frame of up to 12 months.
- Update the status of regularization plan on a monthly basis
- Record a net profit in 2 consecutive quarterly result after the completion of the plan
Action to do by a GN3 Company
- Appoint a sponsor within the first 3 months
- Submit the regularization plan to the exchange for approval within 12 months from the First Announcement
- Complete the regularization plan within 6 – 12 months
- Update the status of regularization plan on a monthly basis
A failure to do so will face a suspension or delisting of the counter.
Some example of regularization plan
- Divestment of non-core business
- Injection of fresh capital via new strategic shareholders
- Agreement and compromise with creditors
- Share capital reduction
- Fund raising via rights issue or private placement
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