ANALYSTS are anxiously awaiting the H share reporting season, which will be kicked off by Yizheng Chemical tomorrow.
As in 1993, analysts should not expect many pleasant surprises in the year-end figures, given the difficulties experienced last year by enterprises under the regime of a mainland credit squeeze.
While percentage increases or decreases in profits could be a disguise for falling margins and rising inventory, analysts will tend to look deeper into the below-the-line picture.
However, this task is made difficult by the differences between Hong Kong (or international) and Chinese accounting standards, and by China's particular economic and financial systems.
Concern about results continue to focus on triangular debt, accounts receivable and foreign exchange fluctuations.
To make everybody's lives easier, it would be preferable for Chinese companies to provide more detail on those factors.
We praised the efforts of mainland companies in financial information disclosure in their first set of annual reports, especially given the fact that 1993 was their first year of exposure to international practices.