Taiwan Semiconductor Manufac-turing Co (TSMC, 台積電), United Microelectronics Corp (UMC, 聯電) and other Asian companies listed in the US must make chief executives vouch for financial statements filed in the US, according to the US Securities and Exchange Commission (SEC).
SEC rules introduced earlier this month forced chief executives at 942 US companies to personally certify the accuracy of financial filings. The rules enforce a law signed July 31 by President George W. Bush in the wake of the Enron Corp and WorldCom bankruptcies to increase accountability.
In a vote on Tuesday, the SEC extended that rule to all companies that have sold securities in the US. Some of them may object, said Richard McCarthy, a Tokyo-based partner at accountancy company KPMG.
"The companies won't like it because it's new, but if they were doing the right thing before, they should be able to certify without a problem," said McCarthy.
Most Japanese companies listed in the US are already used to working with US laws and different global accounting rules, said McCarthy. Other nation's companies, such as China, may have more difficulty with new rules because they have less experience of international listing requirements, he added.
Some 81 companies from the Asian region are listed by the SEC as registered and reporting with the commission as of Dec. 31.
About 644 companies float their shares on US exchanges through US depositary receipts.
The list of registered and reporting companies includes 30 firms from Japan, including Sony, Toyota, Mitsubishi Tokyo Financial Group Inc and Nippon Telegraph & Telephone Corp and 30 from Australia, such as Telstra Corp and Australia and New Zealand Banking Group.
Other companies from the region required to file financial statements with the SEC include 11 corporations from China, 10 from Hong Kong, seven from Singapore and Indonesia, six based in New Zealand, five in Taiwan, four from the Philippines and one from Thailand. Hundreds of other Asian companies have their shares traded as American depositary receipts in the US.
Many of those companies are still examining what changes will need to be made.
"We will follow the new regulations," said Tzeng Jinnhaw (
Chen Cheng-kun (
"These companies should have nothing to be afraid of," he said. "Even though the procedure [to certify their financial statements] will be more complicated than before, business transparency is a positive thing for all investors, which in turn will benefit these companies in the long run."
Besides TSMC and UMC, several other Taiwanese companies have listed American Depository Receipts (ADRs) either on the New York Stock Exchange or the NASDAQ, including Macronix International Co (
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