KUALA LUMPUR (May 12): Serba Dinamik Holdings Bhd and its four top executives involved in the submission of false information have paid a total of RM16 million compound issued by the Securities Commission Malaysia (SC).

Payment for the compound was made on May 9, said the oil and gas company in a statement, whose creditors have filed a winding-up petition against it.

The company and three of its subsidiaries are currently facing winding-up petition from its creditors who provided RM1.2 billion in syndicated term financing after failing to service the debt in December last year.

"Payment was made prior to the extended deadline of May 11, 2022.

"The company would also like to emphasise that operations are continuing as usual, with a focus on managing its creditors and the Practice Note 17 (PN17) restructuring process," said the statement.

Serba Dinamik and its four top executives, including controlling shareholder Datuk Dr Mohd Abdul Karim Abdullah who is also the managing director, were compounded RM3 million each for submitting a false statement involving a revenue of RM6.01 billion for its 12-month financial period ended Dec 31, 2020 (FY20).

The company's audit saga started a year ago when its former auditor KPMG red-flagged issues on its financial accounts.

The executives were initially brought to trial by the SC for the offences after the regulator conducted an investigation into the audit issues raised by KPMG. However, they were offered the compound after the Attorney General's Chambers (AGC) accepted a letter of representation by the accused on the matter.

The SC, which issued the compound, said RM3 million was the maximum amount permissible under the Capital Markets and Services Act 2007 for submission of false information in the company's financial statement.

Beside Mohd Abdul Karim, the other executives were executive director Datuk Syed Nazim Syed Faisal, who was chief financial officer (CFO) from June 2016 until mid-2020; its current group CFO Azhan Azmi; and vice president of accounts and finance Muhammad Hafiz Othman.

Muhammad Hafiz was also slapped with an additional RM1 million compound for falsifying the accounting records of Serba Dinamik's subsidiary.

The parties were given an extension from the initial payment deadline of April 28, according to news reports.

Serba Dinamik is currently in PN17 status as its newly appointed external auditor Nexia SSY PLT expressed a disclaimer of opinion on its audited financial statements for the 18-month financial period ended June 30, 2021.

The company had changed its financial year end to June 30 from Dec 31 when it was embroiled in said audit saga with the former auditor.

Serba Dinamik's share price recouped some lost ground by rising 2.5 sen to trade at 8.5 sen at the time of writing. The stock nosedived to a low of six sen from 35 sen in three trading days when trading resumed on Monday (May 9) after a six-month suspension.