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CMA LAW: Circular No. (14) of 2018 Regarding Material Information for the Public and Financial Statements of Complying with the Provisions of Article (2-32) and Article (2-33) of Module Thirteen of the Executive Bylaws
Date Publish
12 December 2018
"Circular to all fund managers to whom the provisions of Module Thirteen apply"
Fund Managers
Greetings,
We would like to draw your attention to the provisions of Articles (2-32) and Article (2-33) of Chapter Two (Funds) of Module Thirteen (Collective Investment Schemes) of the Executive Bylaws of Law No. (7) of 2010 and their amendments, which stipulated that:
First: Publish monthly information of the Fund to the public through the Exchange:
• The information mentioned in the item (Fund Investment Goals) should match the goals stipulated in the Fund's Articles of Association.
• If the Fund's Articles of Association contains a reference to a particular index, the index should be listed in the item (name of the index), indicating whether the index is a measurement index or a benchmark index.
• As for the Fund components of the largest holdings (the top five components of the Fund (%)), the component is calculated as a percentage of the net asset value of the Fund and not as a percentage of the Fund's capital.
• The following equation should be used when calculating the return of the Fund:
Rate of Investment Return
{(net unit value at the end of the period- net unit value at the beginning of the period) +Distributions during the period} x100
net unit value at the beginning of the period
• The data used in the monthly information form for the fund through the Exchange should match the monthly financial reports provided to the Authority provided that it is in accordance with the last day of the financial period.
Second: Reviewed Periodical Financial Statements and Annual Audited Financial Statements:
• The form of the annual and quarterly statements of investment funds in force at the Exchange shall be canceled, provided that only reviewed periodical financial statements and audited annual financial statements are issued in accordance with the provisions of Article (2-33-1) and Article (2-33 2) of Module Thirteen (Collective Investment Schemes) of the Executive Bylaws of Law No. 7 of 2010 and their amendments.
Third: The announcements of investment funds at the Exchange should be limited to the requirements of Law No. 7 of 2010 regarding the establishment of the Capital Markets Authority and regulating securities activities its bylaws and their amendments and any other resolutions or circulars issued by the Authority.
In this regard, the Capital Markets Authority calls on the fund managers to carefully publish information about the funds in order to create a sound investment environment based on the application of the law in accordance with the principles of justice, transparency and integrity to comply with international best practices. Failure to comply with this circular leads the violator to disciplinary accountability according to the provisions of law No. 7 of 2010 and its executive bylaws and their amendments.
Prof. Ahmad A. Al-Melhem
Issued on: 12/12/2018
Disclaimer: The information provided on this page is for reference purposes only, visitors are encouraged to review and understand the information provided in the official scanned document attached in the link above (if available). The CMA endeavors to ensure that the information on this page is complete and accurate, but the CMA does not guarantee the quality, accuracy, or completeness of any content at any time. In the event the information on this page is different from the content in the official scanned document attached in the link (if available), the official scanned document attached shall take precedence.
