Revaluation of corporate assets became the cause of people’s losses in the stock market / The root of astronomical rights in state-owned companies and banks

According to Fars News Agency’s economic correspondent, Musa Bozorg Asl stated in a meeting held at the auditing organization: “Before the revolution, there were no non-Iranian auditing firms in the country and they were American and British companies.” The private sector and the audit of large corporations and the 330 state-owned companies listed in Annex III of the Budget Law are conducted by the auditing organization.

He added: four types of reports will be submitted to the applicant companies. If the financial statements do not meet the standards, the financial statements will not be accepted. While in 1989 only one percent of the reports were acceptable, but this year it has reached about 50 percent of the reports.

According to the head of the auditing organization, it is extremely difficult to assess taxes without auditing, and unfortunately, financial statements are not audited in a large part of the country’s economy. Accordingly, this area must be strengthened. This organization is the reference for setting standards in the country and audits 680 companies and a number of private companies, including Iran Khodro and a number of banks.

Bozorg Asl said: “After the announcement of the policies of Article 44, the importance of this organization has increased. In practice, two tasks are performed in companies. In addition to auditing, monitoring the implementation of rules and regulations is also included.” Last year, 6,500 laws and regulations were not complied with in 670 audited companies, and these reports were sent to the Court of Audit, the Audit Office and members of the Assembly. Some that are against the law have been referred to the judiciary.

Referring to financial discipline and the importance of standards, he said: “It is very important to strictly observe these cases. The revaluation of companies has had a health impact on the economy. People used and some had secret information and because of this the price of companies multiplied and people lost. While revaluation has no effect on valuation, what is important is the profitability of the company. Nothing economic happens with revaluation. It was only for the purpose of updating the books and financial transparency, it was forbidden in the accounting standard but it was included in the laws and we never imagined that they would create a wave in the stock market and use muddy water.

In response to a question about the audit organization’s oversight of private auditors who examine listed companies, Bozorg Asl said: “The bill of the auditing body has been prepared and is being considered by the government board.” The parliament’s economic commission is also looking for a plan to appoint a body to oversee private-sector auditors.

The responsibility for the audit lies with the Ministry of Economy, and the audit organization, as an advisor to the Ministry of Economy, seeks to eliminate the conflict of interest issue.

In response to Fars’ question about the observance of the salaries and benefits of managers in state-owned and private companies, he said: “Unconventional salaries are the first issues that we check and the salaries and benefits of the CEO and the board of directors are examined.” The auditing organization measures in accordance with the law and regulations, and wherever the payment exceeds the ceiling, it is included in the reports. Astronomical salaries are now lower in state-owned companies.

According to the great principle, The origins of astronomical law began with state-owned companies and banks. In the first tier of state-owned companies we audit, there are basically no unconventional salaries and they are respected, and even the numbers are not so worrying. For the salaries of the year, we have thoroughly examined 99% of the net income, both continuous and indirect, but for the year 1400, there are several interpretations of Note 12 of the Budget Law.

Regarding the need to resolve conflicts of interest in audit reports, especially for listed companies, the CEO of the Auditing Organization stated: We are following the bill of the auditing body, and this issue is also raised and followed up in the form of a plan in the Economic Commission.

In response to a question about the auditing violations of companies in divestitures and privatizations, Bozorg Asl stated: Auditors deal with financial statements and have no role in pricing, but there are obvious violations in auditing, such as auditing violations in Kontursazi or Amir Mansour Aria. We introduced these two companies to the judicial authorities.

Regarding the auditing of the companies affiliated with the Foundation for the Underprivileged and other economic and non-economic foundations in the country, he said: It becomes.

Regarding the number of loss-making and profitable state-owned companies, the CEO of the Auditing Organization stated: According to the information of 1998, 200 loss-making state-owned companies were identified that were attached to the budget law. 90% belonged to 10 state-owned companies, including Bank Melli, Thermal Power Generation, Tavanir, State Trading Company, Petroleum Products Distribution and Refining Company, Iran Air and other companies.

He added: “Also, the profitability of profitable state-owned companies in 1998 was about 48,000 billion tomans, and companies such as the National Oil Company, the National Development Fund, Imidro, and the National Petrochemical Company were among the profitable state-owned companies.”

Asked if the loss-making companies were mismanaging, the CEO of the auditing organization said: “Part of the loss of the loss-making state-owned companies is related to government duties and hidden subsidies.” So some companies are not for profit and they have governance duties. For example, the state trading company buys flour for one thousand tomans and gives 500 tomans to a bakery.

End of message / b