Enforcement concept

Enforcement activities of SIX Exchange Regulation in the area of financial reporting.

The annual and semi-annual financial statements of issuers whose equity securities have a primary listing on SIX Swiss Exchange lie within the scope of the enforcement activities of SIX Exchange Regulation in terms of their compliance with the requirements governing financial reporting. Under their obligations to cooperate (Art. 6 Listing Rules), issuers are required to make available to SIX Exchange Regulation all information and documentation necessary to make assessments and verify compliance with the applicable rules

SIX Exchange Regulation's selection of the annual and semi-annual financial reports to be reviewed is made in a risk-oriented manner and is supplemented by random sampling. The intent is to ensure that the financial reporting of a given issuer is subjected to a review by SIX Exchange Regulation at least every five to eight years.

The actual review of the selected financial statements is also conducted in a risk-oriented manner and is limited to specific areas and areas of focus. If this review gives SIX Exchange Regulation no cause to suspect any potential violations of the applicable financial reporting requirements, the issuer will be notified of that fact by means of a "Direct Comment Letter".

However, if the financial statements give rise to suspicion that the financial reporting requirements may have been violated, SIX Exchange Regulation – as part of a preliminary investigation – will request that the issuer state its position on the matter. Should the issuer's response not confirm the suspicion of a violation that justifies a sanction, SIX Exchange Regulation will issue a "Comment Letter" containing recommendations and the improvements expected in the financial statements published for the next reporting period.

If during the preliminary investigation suspicions arise on the part of SIX Exchange Regulation that the issuer may have violated the accounting standards applied in its financial statements to an extent that justifies a sanction, an investigation will be initiated. An investigation may be concluded by means of a "Comment Letter", an agreement or sanction proceedings.