KUALA LUMPUR (May 29): Serba Dinamik Holdings Bhd “has done nothing wrong”, said its group managing director and chief executive officer (CEO) Datuk Dr Mohd Abdul Karim Abdullah today in clarifying the company's audit issues recently raised by its external auditor KPMG.
The company has described KPMG as acting in an “unfair” and “peculiar” manner for going straight to the company’s independent directors to address the audit issues — instead of briefing the management first.
Furthemore, the management blamed KPMG for delaying the completion of the statutory audit, which resulted in Serba Dinamik missing the audit deadline.
“The Securities Commission [Malaysia] has their rights; Bursa Malaysia has their rights [to investigate]. Based on what we believe, we have done nothing wrong,” said Abdul Karim, who is also the single largest shareholder holding a 26.93% stake in the company, at a virtual press conference today.
He stressed that the audit issues raised by KPMG are not about genuity and it isn’t about legitimacy of contract value.
“We are firm in the facts that we have put forward, and we strongly believe the independent firm will come out with the findings to see the differences between what we have said and what KPMG has [pointed] out,” he added.
“Based on the sequence of events, it is something that is very peculiar and abnormal.
“When these issues were found, the management by right should be the party that was addressed first. But it did not happen that way. The external auditor went to the independent directors and briefed the independent directors on the matter.
“Independent directors are not involved in day-to-day operations. They will not be able to explain those findings raised … it came to us only on May 3 towards the tail end of the year-end audit closing period,” Abdul Karim said.
KPMG first raised the issues to Serba Dinamik’s independent directors in mid-April, before the board was alerted on May 3, after which the company responded to the queries on May 6.
The virtual press conference today was conducted a day after Serba Dinamik’s second largest shareholder, Datuk Abdul Kadier Sahib, issued a notice to propose the removal of KPMG as its external auditor. Kadier, holding a 15.96% stake, is also the company’s non-independent non-executive director.
When asked whether he supports the proposal, Abdul Karim said: “It is still a decision that I will put in a vote on the day it comes.”
During the one-hour session, reporters were not allowed to raise questions directly to Abdul Karim. The media were requested to type in their questions into a chat box. Only selected questions were picked up during the press conference.
The press conference was for the host to explain further its decision to conduct a special independent review of its financial accounts after its board of directors was informed by KPMG on some matters pertaining to the statutory audit.
The company expects the voluntary suspension on its shares to be lifted on Monday. The counter last closed at RM1.61, valuing the group at RM6 billion.
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
Minority shareholders may look to EPF and KWAP for truth of Serba Dinamik’s financials
MSWG urges Serba Dinamik minority shareholders to vote against removal of external auditor