Bursa Malaysia Securities Berhad (635998-W) (Bursa Malaysia Securities) has publicly reprimanded Johan Holdings Berhad (JOHAN) in respect of the company’s fourth quarterly report for the financial year ended 31 January 2015 (QR 4/2015) announced on 24 March 2015 which was in contravention of paragraph 9.16(1)(a) of the Bursa Malaysia Securities Main Market Listing Requirements (Main LR).
Paragraph 9.16(1)(a) of the Main LR states that a listed issuer must ensure that each announcement made is factual, clear, unambiguous, accurate, succinct and contains sufficient information to enable investors to make informed investment decisions.
JOHAN had failed to ensure that its QR 4/2015 took into account the adjustments as stated in the announcement dated 4 June 2015.
The public reprimand was imposed pursuant to paragraph 16.19(1) of the Main LR after taking into consideration all facts and circumstances of the matter including the impact on JOHAN’s share price movement and volume traded after announcement of the QR 4/2015 and the company’s audited financial statements / adjustments and upon completion of due process.
JOHAN 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. The limited review must be performed by the company’s external auditors for four quarterly reports commencing no later from the quarterly report for the financial period ended 31 July 2016. In addition, JOHAN must ensure all its directors and relevant personnel attend a training programme in relation to compliance with the Main LR pertaining to financial statements.
While Bursa Malaysia Securities has not found any of JOHAN’s directors to have caused or permitted the breach by the company, Bursa Malaysia Securities wishes to highlight and remind that it is the duty of the directors to maintain appropriate standards of responsibility and accountability in ensuring compliance of the Main LR. The Board of Directors of JOHAN at the material time was as follows:-
- Tan Sri Dato’ Tan Kay Hock
- Puan Sri Datin Tan Swee Bee
- Tan Sri Dato’ Seri Ting Chew Peh
- Dato’ Ahmad Khairummuzammil Bin Mohd Yusoff
- Mr. Ooi Teng Chew
Bursa Malaysia Securities views the contravention seriously as timely and accurate submission of financial statements to enable investors to make informed investment decisions is one of the fundamental obligations of companies listed on the Official List of Bursa Malaysia Securities.
BACKGROUND
JOHAN had reported an unaudited loss after taxation and minority interest of RM18,633,000 in its QR 4/2015 announced on 24 March 2015 as compared to an audited loss after taxation and minority interest of RM16,387,000 in the audited financial statements for the financial year ended 31 January 2015 (AFS 2015) announced on 26 May 2015. The difference of RM2,246,000 between the QR 4/2015 and the AFS 2015 represented a variance of 12.05%.
The main adjustment was in respect of the reversal of the provision for customer reward points which was over provided by RM1,375,000 in the QR 4/2015 without reasonable justification. Despite being advised of the adjustment required for the over provision of the club reward points prior to the submission of the QR 4/2015 and the impact of the over provision by 7.4% of profit/loss after tax and minority interest, JOHAN decided not to incorporate the adjustment in the QR 4/2015 due to the lengthy process involved in amending the QR 4/2015.
