| Figure conscious
Calcutta, Aug. 27: The Calcutta Stock Exchange management failed to finalise the 2001-02 balance sheet in its meeting on Monday, as broker-directors sought detailed explanation on the figures and refused to pass the accounts.
J. M. Chowdhury, former president and a broker-director of the exchange said: “We have asked the management to produce supporting details. The figures produced in Monday’s meeting lacked clarity, and hence we could not give our approval to the accounts.”
The draft accounts tabled in the meeting pegged the exchange’s loss in 2001-02 at a little over Rs 3.5 crore. Officials of the exchange, however, clarified that there was no significant cash loss. “The net loss was due to depreciation on fixed assets and transfers to the settlement guarantee fund,” they said.
The 19-member board of the Calcutta Stock Exchange comprises nine broker-directors, as many independent directors and one executive director. All the broker-directors were present in Monday’s meeting.
The broker-directors do not have any say in the day-to-day management of the exchange and 2001-02 was the first year under administrative control of an executive team.
The management of the exchange must finalise the accounts within the next 10 days so that its annual general meeting could be held before September 30—the deadline stipulated by the Registrar of Companies. It seems unlikely that the exchange’s accounts will be ready in time to hold the AGM by September-end. In that case, the bourse will have to seek extension of the deadline from the RoC.
Even last year, it could not finalise its accounts and hold the annual general meeting in time, but then the scenario was vastly different. The exchange had not recovered from the payment crisis fully, and its officials were busy with the investigations that had been initiated by the market regulator and the Joint Parliamentary Committee (JPC).
The exchange posted a loss of around Rs 10 crore in 2000-01, after taking into account transfers to reserves and provisions for depreciation. The exchange had lost around Rs 68 crore from its reserves in the payment crisis. Some of it has since been recovered.
In a related development, Supriya Gupta, chairman of the management sub-committee of the exchange, has been re-designated as the president. The Securities and Exchange Board of India (Sebi) had set up the management sub-committee after the payment crisis, removing the panel of broker-directors headed by Kamal Parekh which was in power at the time of the payment crisis.