Resolutely curb “own errors” in fund trust disclosures
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As an important window for understanding fund operation performance and investment strategies, fund annual reports have always been the focus of investors. However, during this year’s fund annual report season, in addition to the much-anticipated position details, managers’ outlook and other content, a number of fund companies issued correction announcements that unexpectedly became the focus of the market. The corrections contained various errors, some of which were even laughable.
For example, a fund’s annual report shows that the fund manager’s position share at the end of the period is 0, but in the 2023 interim report, the manager still holds shares of the product. Since the manager bought the product in the first half of 2023, this means that he is likely to have violated the relevant regulations that require “a fund manager to hold the fund shares he manages for a period of not less than one year.” After the incident attracted widespread attention, the fund company “quickly” issued a correction announcement. The updated annual report showed that the fund manager still held the product.
In addition to factual errors, errors such as typographical errors and “continuation of old manuscripts” are also common. For example, in a fund annual report, “fall” was written as “love dad”. There is also a product whose 2023 annual report contains “Fund Investment Strategy and Operation Analysis During the Reporting Period”, which was found by investors to be completely consistent with the content in the 2022 annual report. This is obviously unreasonable in the rapidly changing capital market environment.
Although most fund companies corrected the errors in their annual reports as soon as possible after discovering them, these “own” incidents have undoubtedly infringed upon the rights and interests of investors. Because when the content of the letter is inaccurate, it is likely to mislead investors into making wrong investment decisions and even paying real money.
“Oolongs” in the letter come one after another, and the most injured will be the entire industry. In recent years, as the wealth management needs of Chinese residents continue to increase, the public fund industry has achieved vigorous development due to its professionalism, transparency and other characteristics. The number of basic citizens in our country currently exceeds 700 million, and the number of public fund products exceeds 11,000. Some “minor oversights” in letter disclosures seem to have no serious consequences and are just laughed at. However, “unexpected errors” in letter disclosures frequently occur, which is obviously not in line with the fund company’s positioning as a professional investor. Just imagine how an institution that cannot even guarantee the accuracy of its annual report can match the word “professional” and win the trust of investors.
To curb the occurrence of “Oolongs” in Xinpi, we must find out the causes and prescribe the right medicine. On the one hand, we need to build systems to plug loopholes. Fund companies should further improve the company’s information disclosure management system, optimize internal control and risk management mechanisms, clarify strict review and proofreading processes, implement multi-dimensional checks, and ensure the standardization and effectiveness of the information disclosure process. At the same time, fund companies should actively explore the use of information technologies such as big data and artificial intelligence to verify the rationality and accuracy of the data and avoid errors and omissions in information disclosure from the source. On the other hand, strict supervision must be adopted to shape the atmosphere. Regulatory authorities should increase penalties for violations of fund disclosures and must not allow correction announcements to become a low-cost, normalized means of correction. Only by making the companies involved feel real pain through high fines, stopping accepting fund registration applications, etc. can they realize that information disclosure is no small matter, thereby promoting the market to form a good atmosphere that values the quality of information disclosure.
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