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Bursa Malaysia Securities Berhad (635998-W) (Bursa Malaysia Securities) has publicly reprimanded Komarkcorp Berhad (KOMARK) for failing to ensure that the company’s announcement dated 28 June 2013 on the fourth quarterly report for the financial year ended (FYE) 30 April 2013 (4th QR 2013) took into account the adjustments as stated in the company’s announcement dated 30 August 2013.
The failure to take into account the adjustments was in contravention of paragraph 9.16(1)(a) of the Bursa Malaysia Securities Main Market Listing Requirements (Main LR) where 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.
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 and upon completion of due process.
KOMARK 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 January 2015. In addition, KOMARK 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 KOMARK’s directors to have caused or permitted the breach by the company, Bursa Malaysia Securities wishes to highlight 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 KOMARK at the material time were as follows:-
(i) Datuk Wira Jalilah Binti Baba
(ii) Koh Hong Muan @ Koh Gak Siong
(iii) Koh Chie Jooi
(iv) Koh Chee Mian
(v) Datuk Ng Peng Hong @ Ng Peng Hay
(vi) Ihsan Bin Ismail
(vii) Koh Chee Hao
(viii) Koh Chee Kian
(ix) Chew Chee Chek
Bursa Malaysia Securities views the contravention seriously and has reminded KOMARK and its Board of Directors of their obligation to uphold appropriate standards of responsibility and accountability to shareholders and the investing public.
BACKGROUND
KOMARK reported an unaudited profit after taxation and minority interest of RM1.517 million in the 4th QR 2013, compared to an audited loss after taxation and minority interest of RM4.831 million in KOMARK’s annual audited accounts for the FYE 30 April 2013 (AAA 2013) which was announced on 30 August 2013. The difference of RM6.348 million between the profit/loss after taxation and minority interest for the 4th QR 2013 and AAA 2013 represented a variance of approximately 418%.
The main adjustment in the AAA 2013 was in relation to the provision for stock written down / slow moving stock amounting to RM3,927,000 which comprised of old / slow moving / unusable stocks. In this regard, KOMARK had failed to make the said provision in the 4th QR 2013 without any reasonable explanation.
The other adjustments in the AAA 2013 were essentially due to the company’s errors and oversight.
