Friday 29 Mar 2024
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KUALA LUMPUR (Aug 4): Loss-making Asia Media Group Bhd, which provides advertising and digital media solutions and services, said today its external auditor CAS Malaysia PLT was unable to express an opinion on the group’s financial statements for the financial period ended March 31, 2021 (FPE21) due to insufficient audit evidence.

According to Asia Media's filing with Bursa Malaysia today, its auditor highlighted that there are material uncertainties that may cast significant doubt on the group's ability to continue as a going concern.

The basis for the disclaimer of opinion relates to Asia Media's opening balances as of Oct 1, 2019 where CAS was unable to satisfy itself that they do not contain misstatements that may materially affect the group's financial performance, cash flows and financial position for FPE21.

These include the group's trade payable balance amounting to RM925,549; other payables and accruals of the group and the company amounting to RM360,967 and RM15,704 respectively; accumulated losses balance of the group and the company totalling RM28.55 million and RM25.07 million respectively; and the group's non-controlling interests balance of RM234,088.

CAS also pointed to insufficient documentary evidence pertaining to Asia Media's current period’s transactions.

It said it was unable to obtain sufficient appropriate audit evidence to the group's trade payable balance of RM469,549; other payables and accruals of the group and the company amounting to RM300,967 and RM15,704 respectively; and the group's non-controlling interests balance totalling RM234,357 and other income of RM516,000.

The group and the company incurred a net loss of RM1.72 million and RM1.85 million respectively for FPE21. As at March 31, 2021, the current liabilities of the group and the company exceeded its current assets by RM5.77 million and RM2.15 million respectively. The group and the company also recorded a deficit in shareholders’ funds of RM5.73 million and RM2.15 million respectively.

“The application of the going concern basis is based on the assumption that the group and the company will be able to realise their assets and settle their liabilities in the normal course of business," said CAS.

On the independent auditor's report, Asia Media's board said it is of the opinion that the preparation of the financial statements on a going concern basis remains appropriate given that it is taking several measures to mitigate the issues and to meet its obligations falling due within the next 12 months.

These include the fact that it is in various negotiation stages to sign new business contracts with potential customers and is currently actively looking at disposing of certain physical assets to generate additional cash inflow.

"The management is currently in negotiations with the opposing parties in the legal suits to reach an amicable settlement plan to allow the group to better manage its cash flow in order to meet its obligations and allow the group to carry on with its business operations.

"The management will also be seeking legal advice to take the next course of legal actions to claim back the advance taken by a former subsidiary DPO Plantations Sdn Bhd. Amount outstanding as at end-FY18 amounted to RM2.3 million," it added.

On Dec 23 last year, Asia Media announced that its auditors Messrs STYL Associates PLT had voluntarily resigned. CAS was appointed on Feb 2 this year.

Asia Media has been categorised as a Practice Note 17 company since October 2019.

At 4.40pm, shares in Asia Media were down 1.5 sen or 10.34% at 13 sen, giving it a market capitalisation of RM32.33 million.

Edited ByKang Siew Li
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