Rule needed to verify states firms' reports

JAKARTA (JP): The Ministry of Finance needs to issue a ruling allowing the Development and Finance Control Board to verify the audit reports made by public accountants on the financial statements of state-owned companies listed on stock exchanges, says an analyst at the government's auditing agency.

Bambang Setiono, an auditor of the board, said that the ruling is necessary, because the government still holds at least 65 percent of the publicly listed state firms.

According to the existing regulations, he said, the board has the responsibility for overseeing the general operations of public accountants.

The regulations also vest the board with the responsibility for supervising and assessing the government's budget and in auditing state-owned companies' operations, including their financial performance.

However, after going public or listing their shares on the stock exchanges, state-owned companies' financial reports must be audited by public accountants to ensure more transparent financial disclosures.

"A new ruling is therefore needed to provide the government auditors with a legal basis to carry out the job," he told Bisnis Indonesia.

He said the verification by government auditors of the listed state companies' financial reports would benefit not only the government, but also the public.

Verification will provide more information on the listed state companies to the investing public, he added.

Bambang said the board should also be allowed to give qualified or unqualified opinions in assessing the public accountants' reports on the listed state firms.

He suggested that results of the government auditor's assessment be submitted to both the Ministry of Finance, as the government's nominee shareholder of the listed companies, and to the Capital Market Supervisory Agency.

Bambang acknowledged that the outcome of the board's assessment on the listed state firms' financial audits could affect their share prices, especially if their opinion is negative or unqualified.

"But it is a justifiable consequence," he said.

There are four state-owned companies listed on the stock exchanges at present, including cement producer PT Semen Gresik, international telecommunications provider PT Indosat, tin mining firm PT Timah and domestic telecommunications provider PT Telkom.

Bank Negara Indonesia (BNI), the country's largest state- owned bank, will list its shares on the local stock exchange next month. (hen)