KUALA LUMPUR (Apr 6): G Neptune Bhd's external auditor has highlighted a material uncertainty in the group's financial statements that may cast significant doubt on its ability to continue as a going concern.
Its independent auditor Siew Boon Yeong & Associates referred to G Neptune's accounts for the period from Jan 1, 2016 to June 30, 2017 (FY17) when the group and the company incurred net losses of RM8.59 million and RM7.15 million respectively.
On top of that, the group’s current and total liabilities exceeded its current and total assets by RM2.46 million while the company’s current and total liabilities exceeded its current and total assets by RM396,344 and RM396,343 respectively.
"These indicate the existence of material uncertainties which may cast significant doubt on the ability of the group and of the company to continue as going concerns and therefore they may be unable to realise their assets and discharge their liabilities in the normal course of business," Siew Boon Yeong & Associates said in its report on G Neptune filed with Bursa Malaysia.
The auditor noted that G Neptune had announced that it became an Affected Listed Company on Nov 30, 2017, and that it is in the process of finalising a regularisation plan.
"The ability of the group and of the company to continue as going concerns are highly dependent upon the successful implementation of the regularisation plan and the ability of the group and of the company to attain profitable operations to generate sufficient cash flows to fulfil their obligations as and when they fall due," it said.
Consequently, the auditor has expressed its qualified opinion on G Neptune's FY17 financial statements.
Other than the material uncertainty highlighted, the auditor said the financial statements gave "a true and fair view" of the financial position, financial performance, and cash flow position of the group and the company as at June 30, 2017, in accordance with the Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of Companies Act 2016 in Malaysia.
G Neptune whose trading has been suspended since November last year, is involved in the IT and textile industries.