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Article 3
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A public company shall plan and prepare its financial forecast in accordance with the following provisions:
- It shall establish a comprehensive written budget system stating monthly cash, production, sales, cost, and capital budgets for reference in preparing the financial forecast.
- It shall form reasonable and appropriate assumptions in good faith, and exercise professional due diligence in appropriately disclosing relevant information.
- The forecast shall be carefully prepared by appropriate persons who are fully acquainted with the enterprise and the industry and who possess expertise in production, marketing, accounting, finance, research, environmental protection, engineering, or other areas, in order to ensure that the financial forecast information is of reasonable and reliable quality.
- Appropriate accounting principles shall be adopted for the preparation of the forecast, which shall also be consistent with the accounting treatment that was expected to be adopted at the time of the actual occurrence and account entry of the specific transaction. When the company management anticipates changes in accounting principles, those accounting principles shall be reflected in the financial forecast.
- It shall carefully and reasonably plan the cash and capital budget, addressing such matters as capital increase by issuing shares, issuing corporate bonds, long-term borrowings, or acquisition and disposal of major assets, to serve as a basis for preparing the financial forecast.
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