With a bill going to the Legislative Council tomorrow seeking tougher penalities for listed companies and directors failing to disclose price-sensitive information, it is time to ask if clearer guidelines on profit warnings are needed. There are several reasons we believe warrant better profit warning guidelines. The mainland now requires listed companies to issue profit warnings if their earnings are expected to be 50 per cent higher or lower than a year earlier. Hong Kong has no such threshold and lets a company's management decide if they need to issue such warnings. With the stock exchange of Hong Kong bringing its trading hours more into line with China, now may be the time to synchronise on other issues. At present, companies in Hong Kong who fail to issue a profit warning or release other price-sensitive information only face a slap on the wrist from the exchange - no fine, no other penalties and no pain. Under the proposed new law, however, they would face fines of HK$8 million, while directors can be banned for up to five years. Profit warnings have been under the spotlight in recent years. Foxconn International Holdings was criticised by the listing committee of the Stock Exchange last week for failing to give a profit warning in a timely manner. HSBC was scolded by lawmakers in March 2009 for not issuing a profit warning after it earnings dropped more than 70 per cent from a year earlier. In the same year, Bank of East Asia and Fubon Bank, did alert the market about sliding profits. HSBC has argued the bank's decisions to close the bulk of its US personal finance business, which led to a substantial US$10.56 billion write-down on its US personal finance unit, was only made shortly before the result announcement so it did not give the warnings. These cases show profit warnings are an issue in the market. With the arrival of the new bill, the time is right to give clearer guidance on when companies need to alert the market. Some news about retirement. John Harrison, 54, who recently retired as deputy chairman of KPMG, has been appointed as independent non-executive director of insurer AIA from this Friday. The author of this column never understands why accountants need to retire so early so it is good to hear that the veteran accountant has a new role to play. Another retiree, we heard, is Robert Nien, 64, a former executive director and now a principal consultant of Hopewell Holdings, who will retire from September 1 after serving the conglomerate for 35 years. Insiders said Nien plans to spend more time with his community services work. For the last two years, he has been a principal consultant with the company and active in environmental protection issues. Promoting green concepts may well be his post-retirement focus.