ASX Listing Rules Guidance Note 8 Continuous Disclosure

The proposed changes mostly expand the current guidance given in relation to analyst and investor briefings, analyst forecasts, consensus estimates and earnings surprises.

Overall, we believe the amendments are useful and the additional guidance and examples provided are very clear.

However, one issue that directors continue to have concerns with is the expectation that listed entities must disclose differences between their earnings and “the consensus estimate” of sell side analysts. It is often the case that determining a consensus among analysts is difficult because the spread on analysts’ views on expected earnings is quite large. The spread of views may be significant even for smaller listed entities that are only covered by two or three analysts. We have also suggested that the ASX provide further guidance around what a “material effect on price” would be. Although it’s important to recognise that what will be material will very much depend on a particular company’s circumstances.