The length of time mainly depends on whether the company meets the listing requirements financially, reviews and modifies the listing prospectus proposed by the company, and then negotiates with the sponsor to modify it. The financial statements of many enterprises have to be revised many times before they meet the requirements.
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Work Flow of China Securities Regulatory Commission's IPO Audit
According to the requirements of administration according to law, openness and transparency, collective decision-making, and division of labor and checks and balances, the initial public offering (hereinafter referred to as IPO) review workflow is divided into main links such as acceptance, feedback meeting, meeting, preliminary examination meeting, issuance meeting, filing, approval and issuance, and different offices are responsible for it respectively, and they cooperate and restrict each other. For each issuer's audit decision, put forward opinions in the form of collective discussion through meetings to avoid personal decision-making.
I. Basic audit flow chart
Two. Brief introduction to the main links of preliminary application review
(1) Acceptance and prior disclosure
The accepting department of China Securities Regulatory Commission accepts the initial application documents according to the requirements of the Procedures for the Implementation of Administrative Licensing of China Securities Regulatory Commission (Order No.66 of the CSRC, hereinafter referred to as the Procedures for Administrative Licensing), the Measures for the Administration of Initial Public Offering and Listing (Order No.32 of the CSRC) and the Interim Measures for the Administration of Initial Public Offering and Listing on Growth Enterprise Market (Order No.61of the CSRC). After the formal acceptance, the issuance supervision department will make pre-disclosure according to the procedural arrangement, and issue the application documents to the relevant supervision office, which will determine the auditor according to the issuer's industry, relevant requirements for official evasion, workload of auditors and other factors. Small and medium-sized enterprises applying for the main board should also be sent to the National Development and Reform Commission for comments.
(2) Feedback meeting
After reviewing the issuer's application documents, the auditor of the relevant regulatory office will write an audit report from a non-financial and financial perspective and submit it to the feedback meeting for discussion. The feedback meeting will mainly discuss the main issues of concern in the preliminary examination, and determine the issues that need supplementary disclosure by the issuer and further verification and explanation by the intermediary.
Feedback will be arranged in the order in which the application documents are accepted. The feedback meeting will be organized and recorded by the general office, and the participants will include the auditors of the relevant supervision office and the head of the office. A written opinion will be formed after the feedback meeting, and it will be fed back to the applicant after the internal procedures are fulfilled. Before the feedback was issued, the issuer and its intermediary institutions were not arranged to communicate with the auditors.
After receiving the feedback, the sponsor institution shall organize the issuer and relevant intermediaries to reply as required. After receiving the feedback and reply materials, the general office will register and transfer them to the relevant supervision room. Auditors shall review the application documents and reply materials as required.
After receiving the feedback, the issuer and its intermediary institutions can communicate with the auditors and, if necessary, with the heads of offices and departments if they have any questions in the process of preparing the reply materials.
The issuer and its intermediary institutions shall report to the issuance supervision department in a timely manner and supplement and modify the relevant materials when the matters that should be disclosed are found in the audit. After the preliminary examination, a preliminary examination report (first draft) is formed and submitted to the preliminary examination meeting for discussion.
(3) Meeting
After the feedback meeting, arrange the meeting according to the order in which the application documents are accepted. The purpose of the meeting is to establish a preliminary communication mechanism between the issuer and the issuance supervision department. Participants include the issuer's representative, the relevant person in charge of the issuance supervision department and the person in charge of the relevant supervision office.
(4) Pre-disclosure of updates
If the feedback has been answered as required, the financial information has not expired, and the relevant government departments that need to solicit opinions have no objection, pre-disclosure and update will be arranged. For eligible projects, the issuance supervision department will notify the sponsor institution to submit the materials of the issuance review meeting and the pre-disclosure materials for updating, and arrange the pre-disclosure update after receiving the relevant materials, and arrange the preliminary review meeting in the order of acceptance.
(5) First trial meeting
The auditor will report the basic situation of the issuer, the main problems found in the preliminary audit and the response to the feedback. The preliminary examination meeting is organized and recorded by the General Office, and the relevant responsible persons of the issuance supervision department, the responsible persons of relevant supervision offices, auditors and members of the IEC (by group) participate.
According to the discussion at the preliminary examination meeting, the auditor revised and improved the preliminary examination report. The preliminary examination report is the summary of the preliminary examination work of the issuance supervision department, and it is submitted to the issuance review meeting together with the application materials after fulfilling the internal procedures.
If the preliminary examination meeting discusses and decides to submit it to the issuance examination meeting for examination, the issuance supervision department will issue a preliminary examination report after the preliminary examination meeting, and inform the sponsor institution in writing of matters that need further explanation, and make preparations for the issuance examination meeting. After discussion by the audit committee, it is considered that the issuer still has important matters that need further disclosure and explanation, and it will not be submitted to the audit committee for the time being, and a written feedback will be issued again.
(6) preliminary examination meeting
The IEC system is an expert decision-making mechanism in the issuance audit. At present, there are 25 people on the SME board of the main board and 35 people on the GEM. When each audit committee is established, it is divided into several audit groups according to the specialty, and each group is arranged to participate in the preliminary examination meeting and audit meeting in turn according to the workload. If there are matters that individual members in each group need to avoid, other members will be arranged to replace them according to the procedure. The Audit Committee conducts audit work by convening audit meetings. The IEC will vote on the initial application by voting. According to the Measures of China Securities Regulatory Commission on the Issuance Review Committee, ordinary procedures are applicable to the meeting of the Issuance Review Committee to review the initial application. Members of the IEC shall vote by secret ballot. Before the meeting, they shall write working papers and record the whole meeting.
Five days before the audit meeting, the China Securities Regulatory Commission issued a meeting announcement, announcing the list of issuers, meeting time and members of the audit committee. At the first audit meeting, auditors will report the audit situation to members and provide explanations on related issues. Members issued audit opinions, 2 representatives of issuers and 2 representatives of sponsors attended the meeting to present their opinions and accept questions. The hearing time shall not exceed 45 minutes, and the members shall vote after the hearing. If the IEC considers it necessary for the issuer to further disclose and explain the problems, it shall inform the sponsor institution after forming a written audit opinion.
After receiving the audit opinions of the IEC, the sponsor institution shall organize the issuer and relevant intermediaries to reply as required. After receiving the reply materials of audit opinions, the general office will forward them to the relevant supervision office. Auditors should review the reply materials as required and perform internal procedures.
(7) sealing volume
After the issuer's initial application passes the examination meeting, it needs to be stamped, that is, the original application documents should be reclassified and filed for future reference. The sealing work shall be carried out after replying to the opinions of the IEC as required. If there is no opinion of the IEC that needs to be answered, it shall be sealed after it is approved by the IEC.
(8) Matters after the meeting
Post-meeting matters refer to the matters that should be disclosed after the issuer's first application is approved by the IEC and before the prospectus is published, which may affect the issuance and listing and have a significant impact on investors' investment decisions. Where post-meeting matters need to be handled, the issuer and its intermediary institutions shall submit post-meeting matters to the General Office as required. After receiving the relevant materials, the general office will transfer them to the relevant supervision room. Auditors should put forward opinions in a timely manner according to the needs. If it is necessary to resubmit it to the audit meeting for deliberation, the internal working procedures shall be performed in accordance with the relevant provisions on post-meeting matters. If the application documents are not sealed, post-processing and sealing can be carried out at the same time.
(9) Approve the issuance.
Before approving the issuance, the issuer and the sponsor institution shall submit the issuance underwriting plan in time.
After stamping and performing internal procedures, the approval document will be issued. After receiving the issuance approval, the issuer may start publishing the prospectus in accordance with the relevant provisions if there are no major post-meeting matters or the procedures for post-meeting matters have been completed.
After the audit procedure is completed, the issuance supervision department will draft continuous supervision opinions according to the audit situation and inform the daily supervision department in writing.
Three. Other matters related to the issuance review procedure.
During the issuance review, I will ask the provincial people's government where the issuer is registered whether it agrees to issue shares, and ask the National Development and Reform Commission (limited to the main board and small and medium-sized enterprises) whether the investment projects raised by the issuer conform to the national industrial policies and investment management regulations. Enterprises in special industries also seek the opinions of relevant competent departments according to specific conditions.
In order to thoroughly implement the national strategy of developing the western region, support the economic and social development of the western region, improve the service level of issuance audit, give full play to the service function of the Shanghai and Shenzhen Stock Exchanges, and better support the development of the real economy, the initial audit work is implemented in accordance with the principle of giving priority to supporting enterprises in the western region and balancing the audit progress of enterprises to be listed on the Shanghai and Shenzhen Stock Exchanges. At the same time, according to the above principles, combined with the completeness of enterprise application materials, the enterprises that have the conditions to enter the follow-up audit link are arranged in the order of acceptance.
The termination audit, suspension audit and resumption audit in the process of issuance audit shall be carried out in accordance with relevant regulations. If the report materials are received during the audit, they shall be handled according to the procedures.
During the issuance review, spot checks will be organized in accordance with the relevant requirements of spot checks on the quality of information disclosure of initial enterprises.
During the issuance review, the issuance supervision department will hold a special meeting to study new situations and new problems that are not clearly stipulated in the existing rules, and put forward opinions and suggestions according to the internal working procedures.