AirAsia auditor raises material uncertainty related to going concern

07 Jul 2020 / 23:01 H.

PETALING JAYA: AirAsia Group Bhd’s auditor Messrs Ernst & Young PLT has issued an unqualified audit opinion with emphasis of matter on material uncertainty relating to going concern in view of the current economic condition and Covid-19 pandemic, in respect of the group’s audited financial statements for FY19 ended Dec 31.

In a Bursa Malaysia filing, Ernst & Young said the group had a net loss of RM283 million for FY19, with current liabilities exceeding its current assets by RM1.84 billion.

Furthermore, the pandemic and the ensuing travel and border restrictions implemented by countries around the world impacted AirAsia’s financial performance and cash flows.

“These events or conditions, along with other matters, indicate the existence of material uncertainties that may cast significant doubt on the group’s and the company’s ability to continue as a going concern,” it said.

However, with the recent progressive uplifting of restriction on interstate travel and domestic tourism activities within the operating countries, the group has seen positive developments on its business operations as passenger seat booking trends, flight frequencies and load factors are gradually improving to cater for the increasing demand.

“The financial statements of the group and the company have been prepared on a going-concern basis, the validity of which is dependent on successful recovery from the Covid-19 pandemic in conjunction with the actions undertaken by the government of the respective countries,

favourable outcome of the ongoing discussions with the financial institutions and investors to obtain required funding and successful implementation of the management’s plans for future actions,” it added.

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