Bursa Malaysia reprimands Ingenuity and Focus

PETALING JAYA: Bursa Malaysia Securities Bhd has publicly reprimanded Ingenuity Consolidated Bhd and its two executive directors for breaching the Ace Market listing requirement as the company had engaged in promotional disclosure activity via issuance of a series of press releases.
The regulator also fined the two executive directors RM100,000 each or a total of RM200,000.
It said the issuance of a series of press releases on Aug 15 and 16, 2012 and an advertorial published in The StarBizWeek on Aug 18, 2012, "which were amongst others, overstated, one-sided and/or unbalanced and had/might have misled investors or caused unwarranted price movement and activity in the company's securities".
In a separate release, Bursa Malaysia also publicly reprimanded Focus Dynamics Technologies Bhd and its directors for breaching of ACE Market listing requirement and its executive chairman was fined RM25,000.
It was reprimanded for failing to ensure that the company's announcement dated Feb 28, 2012 on the quarterly report for the 17 months financial period ended (FPE) Dec 31, 2011, took into account the adjustment as stated on the company's announcement dated April 30, 2012.
On Feb 28, 2012, Focus had reported an unaudited loss after tax and minority interest of RM4.496 million in its unaudited results.
However, on April 30, 2012, Focus announced an audited loss after tax and minority interest of RM7.952 million in its annual audited accounts for the FPE Dec 31, 2011.
The difference of RM3.456 million between Focus' unaudited and audited results for the FPE Dec 31, 2011 represented a variance of 76.86%.
The variance of RM3.456 million was mainly due to the provision for impairment losses on trade receivables and products development expenditure (PDE) amounting to RM2.901 million and RM546,000 respectively in the audited results subsequently.
The regulator said Focus is also required to review and ensure the adequacy and effectiveness of its financial reporting function and carry out a limited review on its quarterly report submissions.
It said the limited review must be performed by external auditors for four quarterly reports commencing no later from the quarterly report for the financial period ended March 31, 2014.
In addition, it said Focus must ensure all its directors and relevant personnel attend a training programme on compliance with the ACE LR pertaining to financial statements.
The regulator views the contravention seriously as the requirement for listed companies to submit financial statements that are factual, clear, unambiguous, accurate, succinct and contained sufficient information to enable investors to make informed investment decisions is of paramount importance in ensuring the integrity and reliability of financial statements and a fair and orderly market for securities that are traded on Bursa Malaysia Securities.