In other words, the expert, Dr. Ronen, also admits that the Government Companies Authority, a government body where the state has control of Agrexco, approved Agrexco's financial statements while being aware of the controversial accounting policy, but according to him, it did so out of systemic considerations and regulatory constraints.
Moreover. One of the ISA's defined functions in the law is to check the reports submitted to it by government companies and the material on which they are based, and to make comments to the company and the ministers. Thus, with regard to the statutory authority to examine reports and provide comments, section 54(6) of the Government Companies Law, 5735-1975 (hereinafter: "the Government Companies Law") states that:
- The Authority -
(6) It shall examine the reports submitted to it by a government company and the material on which they are based, and shall make its comments thereon to the company and the ministers."
Thus with regard to the scope of the Authority's powers of examination and review in section 55 of the Government Companies Law:
"55. In the performance of its functions, the Authority may demand from a government company or a mixed company, provided that more than a quarter of the voting power at the general meeting or the right to prevent more than a quarter of its directors is in the hands of the State, as well as from a director on behalf of the State, from the General Manager of a government company, and through him from anyone who works in the Company or is employed in its service, information and material on the Company's affairs, and it is entitled to review the Company's records and documents; For this purpose, the "Authority" - including a person authorized by the Authority to do so in accordance with the rules set by the Minister of Finance, according to the Authority's proposal."
The same applies to the companies' reporting obligation to the Authority in section 34(a) of the Government Companies Law (where section 33(a) refers to the balance sheet and profit and loss report):