MSWG urges Serba Dinamik minority shareholders to vote against removal of external auditor

MSWG urges Serba Dinamik minority shareholders to vote against removal of external auditor
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KUALA LUMPUR (May 29): The Minority Shareholders Watchdog Group (MSWG) has urged minority shareholders of Serba Dinamik Holdings Bhd to vote against the resolution to remove KPMG PLT as the external auditor of the company.

In a statement today, the MSWG said the external auditor should be allowed to complete its work and report to Serba Dinamik shareholders in the upcoming annual general meeting (AGM) as part of good governance.

It added that the auditor will be present in the AGM to address queries from shareholders in relation to their opinions, with the audited financial statements to be presented along with the group’s annual report.

It said that external auditors are appointed by shareholders to provide an independent opinion on whether a company’s financial statements present a true and fair view.

“Since the company is setting up a special independent review by appointing an independent firm to assess the veracity and accuracy of the matters brought up by the external auditor, the external auditor should be around to defend their findings and explain themselves.

“There is no urgency to remove the auditor at this juncture. As such, the MSWG urges all shareholders to vote against the resolution to remove the auditor,” it said.

Yesterday, KPMG raised concerns related to the company’s sales transactions, trade receivables and payables, as well as material on site balances, according to the company’s filing with Bursa Malaysia.

The issues highlighted involved 11 parties which accounted for total sales transactions of RM2.32 billion, a trade receivables balance of RM652 million and material on site balance of RM569 million.

The auditor also raised issues relating to purchases and trade payables involving six local suppliers involving a total transaction amounting to RM481 million, Serba Dinamik said, as well as issues around the company’s customer and supplier in Bahrain involving total sales transactions of US$101 million (RM417.48 million) and a trade receivables balance of US$24 million (RM99.2 million).

The announcement was made two hours after Serba Dinamik non-independent non-executive director Datuk Abdul Kadier Sahib, who holds a 15.96% stake, proposed to call for an extraordinary general meeting (EGM) to remove KPMG as its auditor and appoint BDO as replacement.

Read also:
KPMG raised audit issues on transactions involving over RM3 billion, says Serba Dinamik
Serba Dinamik's second largest shareholder proposes removal of KPMG as auditor
Serba Dinamik board wanted KPMG to resign, but auditor refused to do so, says executive director Syed Nazim
'We have done nothing wrong,' says Serba Dinamik MD Abdul Karim
Minority shareholders may look to EPF and KWAP for truth of Serba Dinamik’s financials

Surin Murugiah