Yeo Hiap Seng, which had understated losses incurred by its operations in Malaysia, has completed a review by auditors.
From the review, the company says there are no other significant errors that will have a material impact on the consolidated financial statements for audited FY2021 and unaudited 1HFY2022.
The review did not find any evidence or indication of fraud in relation to the FY2021 and 1H2022 Misstatements.
Last but not least, there’s no material weakness in the systems of internal controls within the finance function.
“Nonetheless, the review has identified certain control observations and improvement opportunities, including in the communication of and compliance with group policies and procedures, escalation of deviations to group finance, and documentation of consolidation entries and evidence of review, which management will act upon with a view to improving and strengthening the key internal controls relating to the group’s financial reporting processes,” the company adds.
On Oct 19, the company announced that its subsidiary in Malaysia had understated its net loss for FY2021 ended Dec 2021 and 1HFY2022 by $2.1 million and $1.8 million respectively.
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The company attributes the mistakes to “human errors”.
Had the accounting errors been known at the time of the unaudited results for the six-month period, the group would have seen a net loss of $0.6 million instead of a net profit of $1.2 million if the 1HFY2022 misstatement had been adjusted for.
Yeo Hiap Seng shares closed Nov 25 at 67 cents, down 2.19% for the day, down 22.99% year to date.