PETALING JAYA: The Malaysian Institute of Corporate Governance (MICG) has recommended Serba Dinamik Holdings Bhd’s board to present its views along with the opinion of its external auditors as well the “second opinion” of the audit firm that will conduct an independent review following its dispute with KPMG, to the group’s shareholders.
MICG deputy president David W Berry noted that the group had previously named BDO as its adviser but there was no final agreement. Subsequently, it had named Ernst & Young (EY) for the role, subject to finalisation of details. He views both firms should be competent.
“The key factor will be the scope of the advice sought, which should be restricted to the specific audit issues raised by KPMG. The independent EY opinion should apply the same professional standards expected of any auditor in assessing its stance on those audit issues,” said Berry in statement today.
He pointed out that any difference will be in the weight given to the surrounding factors and this should not involve a full re-audit of Serba Dinamik.
Whether this resolves matters is difficult to tell, Berry explained, as it will depend on EY’s opinion.
“However, MICG continues to be of the view that any director who is also a shareholder should not participate in any shareholder vote related to this matter or the choice of the company’s auditor,” said Berry.
The group’s woes started with audit issues flagged by its external auditor KPMG, which casted doubt on its sales transactions, receivables and payables to the tune of over RM3 billion. Its majority shareholder and director Datuk Abdul Kadier Sahib had sought to call an EGM to replace the firm via a special notice and subsequently withdrew the motion. Instead Serba Dinamik intends to conduct an independent review of the audit issues raised by KPMG.
Serba Dinamik was the most active stock on the bourse today, closing 8.72% or 6.5 sen lower at 68 sen on 423.04 million shares traded.
