Friday 29 Mar 2024
By
main news image

KUALA LUMPUR (April 21): Serba Dinamik Holdings Bhd believes an "internal irreconcilability" of the charges levelled by the Securities Commission Malaysia against the company over the alleged false RM6.01 billion revenue figure was what prompted the Attorney-General (AG) to compound the company and its top executives, instead of pressing ahead with the criminal charges against them.

Serba shared its take on the matter in a 26-page long bourse filing on Thursday, which it said "concerns" the Feb 7 High Court order that compelled the company to reveal the factual findings update (FFU) that was prepared by Ernst & Young Consulting Sdn Bhd (EYC), which was appointed to undertake a special independent review on the group following audit issues raised by KPMG.

Serba, however, has been dragging its feet in complying with this order, which led to Bursa Malaysia Securities to initiate contempt proceedings against the company last Thursday (April 14).

Meanwhile, it believes the AG would have taken into account several considerations in arriving at its decision to compound the company and its four executives, including the continued delay by the SC in producing documents to support its allegations against those charged regarding the false RM6.01 billion revenue figure.

It also said the SC had alleged that only the fourth quarter's consolidated cumulative revenue of RM6.01 billion was false but not that of the first, second and third quarter figures, which "amply demonstrates an internal irreconcilability within the four corners of the charge itself".

"As a matter of logic, in order for the consolidated cumulative 4th quarter revenue of RM6.014 billion to be false, the 1st, 2nd and 3rd quarter revenues should also be false. This ought not to be viewed as a mere mistake on the part of the SC but rather, a manifestation of a hasty action in bad faith, to bring charges in furtherance of an underlying improper purpose. It is the SC who should explain why they had come to the conclusion that every item of the revenue was false," Serba said.

It also suggested that its subsidiary Serba Dinamik Sdn Bhd (SDSB) had been singled out in the SC's single charge in the Shah Alam High Court for falsifying revenue, which it said implied that the false RM6.014 billion consolidated cumulative revenue emanated from SDSB alone.

It also suggested that the matters raised by KPMG and the FFU did not weigh on the SC's decision to draft the charges in the way it was drafted.

"The charges brought by the SC against the company are peculiar in that it constitutes a complete departure from the issues raised by KPMG and EYC," it claimed, adding the three — KPMG, EYC and SC have different contentions.

"KPMG’s main thrust is that they are not able to accept or reconcile certain matters they have come across. KPMG then stopped work.

"EYC’s findings suggest that they have come across many suspicious materials but are completely silent on how such suspicious materials translated into false revenue only. EYC in fact suggests that they have found issues in both revenue and expense matters, across various years, not only 2020. EYC then stopped work.

"It is necessary to view SC’s charges in the light of the SC having access to KPMG’s complaint and EYC’s FFU, where SC had chosen to focus only on consolidated revenues of a very specific quarter, i.e. the cumulative 4th quarter for 2020," Serba said.

Edited ByTan Choe Choe
      Print
      Text Size
      Share