Disclosure, Reporting and Transparency
What the exam tests
This domain tests timely, accurate and balanced disclosure: annual reports, governance reports, related-party transactions, material board changes and inside information.
Core rules
- Listed entities must disclose material information promptly under NGX and SEC rules. Delay to “manage the message” is a breach.
- Annual reports should include financial statements, directors’ report, corporate governance report, audit committee report and related-party disclosures.
- CAMA requires annual returns and specified filings; sector regulators add prudential and conduct reporting.
- Disclosure must be accurate, balanced and not misleading. Selective briefing of analysts before public release creates inside-information problems.
- Explain non-compliance; boilerplate statements that do not match actual practice undermine transparency.
Worked example
A listed company’s chair resigns on 2 March. The company waits until the annual report in June to announce it. Reasoning: a chair’s resignation is material to governance and likely price-sensitive. Listing rules require prompt disclosure. The delay deprives the market of information and may breach continuing obligations, even if the annual report eventually discloses it.
Traps
Disclosing only good news; labelling everything “confidential” to avoid disclosure; treating a governance report as marketing copy; failing to disclose related-party transactions because they were approved; and assuming annual disclosure cures a delayed announcement.