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{
    "id": 573968,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/573968/?format=api",
    "text_counter": 97,
    "type": "speech",
    "speaker_name": "Hon. Mbui",
    "speaker_title": "",
    "speaker": {
        "id": 1750,
        "legal_name": "Robert Mbui",
        "slug": "robert-mbui"
    },
    "content": "Thank you, Hon. Temporary Deputy Speaker. The Capital Markets Authority will regulate on takeover rules that will deal with the takeover bids and merger transactions. It has also been mandated and given authority to rule and interpret the law when there is conflict between organizations at the point one wants to take over the other. It is, therefore, important that this is put clearly in law so that it can ease any possible conflict in future between organizations that want to take on each other because that happens many times. The Authority will also ensure that they rule on interpretation, application and the effect of takeover rules. As I finish, companies in this law are expected to make annual returns with the Registrar. But I made observations that when the companies are registered they are supposed to give the same requirement and documentation every year. I find that a bit odd because at the point of registration, the information or the items required at that point will be given. When there are any changes, amendments and resolutions they are also given to the Registrar within 14 days, failure of which there are penalties. It is a bit strange that every year companies are expected to make returns to the Registrar. I do understand the bit of financial returns which is not to the Registrar. That is a contradiction. On auditing of company financial statements, there is a requirement that most companies do audited financial statements. There is also a right of members to request for these audits. This is because there are certain companies that do not have to give or get their audited returns, but members of these companies have a right to seek for audit. I want to join my colleague who talked about the small companies which have been given certain conditions for exemption from doing annual audits. They say that they have to qualify as a small company. The definition of a small company is a turnover of less than Ksh720million and net assets worth less than Ksh360million. The population of staff is not very important. I want to agree with him that when you talk about a turnover of less than Kshs720 million, you can define that as a small company. Most of the companies that are operating in this country are operating at a much less turnover. Therefore, it means that most locally and privately owned companies will not be dealing with audit on an annual basis. This is something that needs to be looked at. They give exemptions to public companies, banking and insurance companies which do not qualify to be small companies. The rest that are exempt are dormant companies which do not do business for that financial year, thus they have no returns to make. Finally, I want to say that this law is very broad. It is a good legislation for this House to go through. It deals with issues on how to appoint auditors and states their functions. I support this Bill. Most of the amendments that will be made will be brought in the Third Reading. If there is any that we will come across, we will also share. Somebody had asked me to share, but I know I do not have that right. Hon. Temporary Deputy Speaker, I support and thank you for the opportunity."
}