Independent review by EY into issues raised by its former external auditors is expected to be completed by next month
by NUR HANANI AZMAN / Pic by TMR FILE PIX
SERBA Dinamik Holdings Bhd is in “business as usual” mode with all operations put on close monitoring for compliance to the environmental, social and governance (ESG) framework.
Group MD and CEO Datuk Dr Mohd Karim Abdullah said the company is tapping into orders that can generate fast cash income, especially from projects related to information and communications technology (ICT), and operations and maintenance (O&M) jobs.
“The business outlook is fairly optimistic, but dependent on the Covid-19 pandemic situation,” he told The Malaysian Reserve.
With sustainability issues gaining prominence in the corporate sector, the group is aware ESG has become the yardstick by which most institutional investors make their investment decisions.
Mohd Karim said Serba Dinamik’s upcoming quarter results are scheduled to be announced on Sept 29.
The company changed its financial year end from Dec 31, 2020, to June 30, 2021, due to extension of the Movement Control Order in Malaysia and lockdowns in other countries that hampered the group’s ability to finalise its financial statements.
Despite its accounting issues, Serba Dinamik registered a net profit of RM113.32 million on the back of RM1.38 billion in revenue for the fifth quarter ended March 31, 2021.
The company’s O&M segment was the largest contributor to the revenue, at RM1.26 billion or 90.5% of the total revenue.
Mohd Karim said the independent review by Ernst & Young
Consulting Sdn Bhd (EY) into the issues raised by its former external auditors, KPMG Ltd, is ongoing and expected to be completed by October 2021.
“The report will be submitted to Bursa Malaysia,” he added.
The integrated oil and gas service provider appointed EY in July as its independent reviewer to assess the veracity of the audit issues raised by KPMG.
Its independent non-Eds have been receiving progress updates from EY on a biweekly basis, Mohd Karim said.
The scope of works calls for EY to assess the validity and veracity of the transactions and balances on sales, trade receivables and materials on sites with respect to 11 identified customers, and to quantify any possible financial impact.
It is also looking into purchases from six local suppliers; IT contracts and transactions involving six customers and two suppliers, as well as the revenues and costs involved; and the transactions and balances involving one customer and one supplier in Bahrain.
On Aug 4, Serba Dinamik announced the appointment of Nexia SSY PLT as its new external auditor.
In an exchange filing, Serba Dinamik said Nexia has received professional clearance from KPMG in accordance with Section 320 by-law of the Malaysia Institute of Accountants.
KPMG had resigned as Serba Dinamik’s external auditor on June 24 after the latter filed a court action against it.
Meanwhile, Serba Dinamik’s share price has weakened after co-founder and non-independent director Datuk Awang Daud Awang Putera was made to force sell shares according to the company’s filings.
He force sold some 12.6 million shares since Sept 8, exchange filings showed, which has put the price under fresh downward pressure.
Serba Dinamik closed three sen or 8.2% lower at 33.5 sen yesterday and is only three sen off its historic lows.
Following the disposal of the shares, Awang Daud’s stake in Serba Dinamik stands at 12.8 million shares or 0.346%.