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The Legislative Provisions For Alternative Performance Indicators

Original Language Title: Normatīvie noteikumi par alternatīvajiem snieguma rādītājiem

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Financial and capital market Commission, the provisions of regulations No 118 in Riga on 6 July 2016 (financial and capital market Commission Council meeting Protocol No 23 14. p.)
The legislative provisions for alternative performance indicators Issued pursuant to the financial instruments market law 4.2 article i. General questions 1. "the legislative provisions for alternative performance indicators" (hereinafter referred to as the rules) is binding to all issuers whose securities are admitted to trading on a regulated market, the information contained in the prospectus and on the persons responsible.
2. the rules shall lay down the requirements for the performance of alternative indicators (hereinafter also – ASR) detection and mandatory information in prospectuses. 3. Are not subject to the provisions of ADR: 3.1 opening financial statements; 3.2. opening in accordance with the applicable law, except for the applicable financial reporting framework for management reports or interim management report, which lays down specific requirements for the following indicators. Consequently, the provisions do not apply to the indicators contained in prospectuses, for example, pro forma financial information, related party transactions, profit forecasts, profit calculations, notifications for working capital and capitalisation as well as debts covered by the prospectus regime's specific requirements, and on the measures, including prudenciāl measures, as defined in the European Parliament and of the Council of 26 June 2013 in Regulation No 575/2013 for the prudenciālaj requirements for credit institutions and investment firms And in the law of credit institutions, the law on the financial instruments market. 4. the terms used in the rules: 4.1. responsible persons, persons responsible for the information contained in the prospectus in accordance with the financial instruments market law article 46; 4.2. financial reporting guidelines-international financial reporting standards as adopted in the European Union under Regulation (EC) No 1606/2002 on the application of international accounting standards, or Latvian law requirements for the preparation of the financial statements; 4.3. financial statements, annual and interim financial statements and additional periodic financial information prepared in accordance with the applicable financial reporting framework and by the issuer, or the persons responsible found in accordance with the law on the financial instruments market; 4.4. compulsory information – all the information which the issuer or any other person who has requested the admission of securities to a regulated market without the issuer's consent, is required to disclose in accordance with the law on the financial instruments market and European Parliament and Council of 16 April 2014 Regulation No 596/2014 regarding market abuse (market abuse Regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission directives 2003/124/EC 2003/125/EC and 2004/72/EC (text with EEA relevance), for example, a management report annual or semi-annual statements or interim management report.
II. Alternative indicators of performance principles of disclosure within the meaning of Rule 5:5.1 ADR historical or future financial performance, financial position or cash flows that are calculated on the basis of the financial statements, prepared in accordance with the applicable financial reporting framework, indicators, adding or subtracting from the figures presented in the financial statements, such as operating revenue, cash income, profit before one-time charges earnings before interest, taxes, depreciation and amortization, net debt and comparable indicators, which represents the financial statement items of the correction; 5.2. for ADR are not considered: 5.2.1 indicators, defined or determined by the applicable financial reporting framework, for example, revenue, profits or losses, earnings per share; 5.2.2. the physical and financial indicators, such as number of employees, number of subscribers, the turnover per square metre or social and environmental indicators, such as greenhouse gas emissions, labour breakdown by contract type or geographical location; 5.2.3. information on the major shareholders, the acquisition or disposal of shares and the total number of voting rights; 5.2.4. the information that explains the provisions of the Treaty or legislative requirements, such as lending conditions or the Director or Manager remuneration calculated on the grounds. 6. the issuer or the person responsible defines the ASR and the component, specifying the principles of calculation used and including information about all the major theories and assumptions, and indicate whether the ADR refers to a past or future reporting period (estimated). 7. the legend of ADR in order to avoid the submission of misleading information to users, do not use excessively optimistic or positive terms, such as "guaranteed profit" or "return" protected and does not use the terms, titles and descriptions that are the same or similar to those defined in the applicable financial reporting guidelines. 8. Discovering ADR provides the most direct reference to the related item, subtotal or total period financial statements used in the calculation of the relevant ADR. If it is not possible to provide a reference, because the item is not directly derived from the financial statements, such as estimates of future earnings projections or profit forecasts, providing an explanation of the following ADR consistency with the accounting policies applied in the financial statements, prepared in accordance with the applicable financial reporting framework. 9. If ADR can direct identification of the financial statements, references are not necessary. This applies, for example, to ADR, which is a subtotal or the total amount stated in the financial statements. 10. If the financial statements for that period have not yet been published, a reference to the most directly relevant for ADR giving item, subtotal or total that will be included in the financial statements when they were published. 11. Revealing the ASR, with comparative information for the previous corresponding period. If ASR applies to projections or estimates, comparative information is calculated using the latest available information from the past. The issuer or the person responsible shall provide references for all provided comparative information. If the reference is not possible to provide information, explain why it is not possible to provide comparative information. 12. To enable users to understand the meaning and veracity of ADR, the issuer or the person responsible explains why they believe that ADR provides useful information about the financial position, cash flows or financial indicators, as well as indicate what objectives the ASR is used. 13. Prospectuses of ADR contained consistently use financial periods covered by the prospectus. The issuer or the person in charge ensures that the definition and calculation of ADR is consistent over time. In exceptional cases, if the issuer or the person in charge decides to adjust the definition of ADR, the issuer or the person responsible: 13.1. explain the changes; 13.2. explain the reasons why these changes result in reliable and useful information about the financial activities; 13.3. provides adjusted comparable data. 14. If the issuer terminates disclose an ASR, it explains the reason why it is believed that this ADR will no longer provide useful information. 15. If an ADR is replaced with another, explain why the new ASR provides reliable and helpful information, compared to the previously used ADR. 16. with the exception of the prospectus, subject to financial instruments market law specified in article 44.2 separate references into the rules, the rules laid down in the principles of disclosure of the information may be replaced with a direct reference to other published documents containing the following information on ADR, and which is easy and convenient for users. In this case, compliance with the rules, read the documents assessed together. However, using appropriate references, not to violate such principles: 16.1. be provided comparative information on ADR in the corresponding previous period. 16.2. references should be redirects users to the information required by the regulations. Such reference must be accurate, indicating the specific page, section or chapter of a document where this information can be read.
III. final question 17. Applicable mandatory information and prospectuses published, starting from the date of entry into force of the provisions. Financial and capital market Commission President p. Bird