If compared, the continuous disclosure forms a significant element of the corporate disclosure framework in Australia. In case there is any increase implemented in the upcoming times with regards to the recurrence of the periodic reporting by disclosing entities, it must not be done at the cost of the present requirements for continuous disclosure to investors about the material price sensitive information. (The Treasury, 2010) This emphasizes the fact that the continuous disclosure is more effective in providing information, being immediate, rather than the customary periodic disclosures, which might have information that impacted the company sometime back and remains just a record now.
Both the continuous and periodic disclosure requirements are applicable to the disclosing entities currently. Under the section 302 of the Corporations Act 2001, the disclosing entities should put forward to ASIC, the half-yearly and annual audited financial reports. There is a quarterly financial reporting that is followed by the US systems, which also has raised several suggestions that Australia as well considers mandatory, even though unaudited, quarterly reports. (ASX, 2011)
The compliance cost for both the disclosures is alleviated by the actuality that they can be derived mostly from internal monthly reporting that is already in place. Both the disclosures provide the stakeholders with the important and material information that poses a possible impact on the price of shares of the company. These disclosures aim at disclosing the financial information, which is the essential disclosure that the annual reports contain, and offers the foundation of other associated information, which might be disclosed in the report, like the assessment of the management as well as the analysis of the prospects and the past performance of the company.
The continuous and periodic disclosures work in tandem and their combination provides suitable disclosure to the various stakeholders in the market, together with minimisation of the business’ compliance burdens.
There is ongoing disclosure required concerning various specific matters, which are contained in Chapter 3 of the ASX Listing Rules. There has been increase in the number of matters, by the SEC, where the ongoing disclosures are required. Finally, the listing rules require listed entities for continuously disclosing price sensitive information to investors and they have statutory backing (The Treasury, 2010).