KUALA LUMPUR (Sept 1): Bursa Malaysia Securities Bhd has publicly reprimanded flight training provider APFT Bhd and six of its former directors for the inaccurate reporting of its financials for the second quarter ended April 30, 2017 (2QFY17), on top of late announcement of the group's Practice Note 17 (PN17) status. The six former directors have also been slapped with a collective fine of RM475,000.
The six are APFT's former executive chairman Datuk Faruk Othman, former executive director Arif Faruk, former independent and non-executive director Tan Nyap Keong @ Tony Tan, former executive director Edwin Silvester Das, former independent and non-executive director Chow Hung Keey, and former independent and non-executive director Datin Seri Anizah Musa.
According to Bursa in a statement today, APFT had, in its financial report for 2QFY17, inaccurately recognised RM2.15 million of other income arising from the write-back of over-provision of expenses from previous years. This was subsequently reversed out in APFT's audited financial statements for the financial period from Aug 1, 2016 to Jan 31, 2018 (AFS 31/1/2018), which were released on May 31, 2018.
On top of this, APFT failed to immediately announce — referred to as making the First Announcement — that it had triggered the Practice Note 17 (PN17) criteria, when it announced its report for the fourth quarter ended Sept 30, 2017 (4QFY17) on Nov 30 that year.
APFT triggered the PN17 criteria as its external auditors had expressed an emphasis of matter on the company's ability to continue as a going concern in the group's audited financial statements for the financial period ended July 31, 2016. On top of that, based on the group's 4QFY17 report, its shareholders' equity on a consolidated basis was at RM19.26 million, or 34.6% of its issued and paid-up capital of RM55.64 million.
"APFT only made the First Announcement pursuant to PN17 on Jan 19, 2018," Bursa said.
Bursa further said APFT is now required to review and ensure the adequacy and effectiveness of its financial reporting function and carry out a limited review on its quarterly report submissions.
"The limited review must be performed by the company's external auditors for four quarterly reports commencing no later from the quarterly report for the financial period ended July 31, 2020. In addition, APFT must ensure all its directors and relevant personnel attend a training programme in relation to compliance with the Main Market Listing Requirements pertaining to financial statements," it said.
Trading of APFT shares has been suspended since March 12.
Edited by Tan Choe Choe
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