This thread hopes to start a public complaint campaign against the ASX.
The specific issue of complaint is the new Quarterly Cashflow Report (Appendix 5B) lodged by speculative companies.
Many of us invest in speculative companies, such as mining exploration and biotech companies.
Previously, the Quarterly Cashflow Report required of companies to provide a forecast estimate of their cash expenditure for the new (current) quarter.
However, the new Quarterly Cashflow Report does not have this requirement.
Instead, the new Quarterly Cashflow Report only requires the company to estimate the amount of future quarters of funding based on the expenditure incurred in the previous quarter.
While the new Appendix 5B form has a question: "Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?", it appears there is a high probability of this question remaining unanswered, unless the change in spending is extreme.
Also, positively, if a company does not have the equivalent of 2 x the previous quarterly spend in cash, it must explain how it will raise capital. However, again, this requirement is based on the illogicalness of using the previous quarter's cash flow as a guide.
I think the new Appendix 5B form is impractical and is particularly an extremely serious loss of transparency for retail investors.
It is impractical because speculative companies have significant variations in funding from quarter to quarter.
For example, a company doing preliminary mineral exploration in one quarter will incur much less expenditure in that quarter; compared to when they undertake a major drilling program in the next quarter. Then if they commence feasibility studies in the next quarter, their expenditures will be even greater.
It is a serious serious loss of transparency for retail investors because it provides much less public disclosure of the cash position of speculative companies.
