Disciplinary Committee of OMX Nordic Exchange Stockholm fines Digital Vision (09/08)

Digital Vision AB has contravened the rules of the OMX Nordic Exchange Stockholm by not complying with the applicable accounting principles (IFRS) and by not immediately disclosing a qualified audit report. The Exchange’s Disciplinary Committee has resolved that Digital Vision shall pay a fine of three annual fees, corresponding to SEK 576,000.   
	
According to the OMX Nordic Exchange Stockholm’s listing agreement, annual reports must comply with applicable legislation, which means that the company shall apply International Financial Reporting Standards (IFRS). Furthermore, a qualified auditors’ report must be disclosed immediately after it has been submitted to the company. 

In its annual report for 2005, Digital Vision reported impairment losses in conjunction with the acquisition of Nucoda Ltd on a separate line in the net financial items section and not as part of operating profit. No adjustments of this information were made in the 2006 annual report. In this instance, the Disciplinary Committee rules that the reasons presented by the company for deviating from the main IFRS rule cannot be characterized as so exceptional that they would entitle the company to report the impairment in the manner in which it had done. This means that the annual report deviated from IFRS and thus also from the listing agreement. However, the Disciplinary Committee believes that this shortcoming was of a less serious nature.  

In the 2006 annual report, Digital Vision also reported intangible assets designated “unpatented technology”. No depreciations were made of this asset and no detailed information was submitted pursuant to the regulations. In this instance, the Disciplinary Committee believes that the company should have submitted a report explaining why depreciations of the intangible asset were not conducted. The fact that this did not occur constitutes a breach of IFRS regulations and thus also of the listing agreement.

The audit report pertaining to Digital Vision’s annual report for 2006 contained a comment regarding the company’s future financing capabilities. Since this meant that the audit report was to be regarded as “a qualified audit report”, it should have been disclosed immediately, pursuant to the provisions of the listing agreement. By not complying with this, Digital Vision was in breach of the listing agreement.

The Disciplinary Committee imposes a fine corresponding to three annual fees, corresponding to SEK 576,000.

The following persons participated in the Committee’s decision: Johan Munck, Marianne Lundius, Madeleine Leijonhufvud, Ragnar Boman and Hans Edenhammar.