KUALA LUMPUR: Four out of six completed investigations carried out by FGV Holdings Bhd forensic audit and internal investigations team in January 2018 showed adverse transactions were executed by the company in previous years.
The completed audits and investigations are on the acquisition of Asia Plantations Ltd (APL), investment in FGV Cambridge Nanosystems Ltd and the acquisition of Troika condominiums.
However, the company has not disclosed details on the findings via a statement sent to the press today.
The audit and investigation on another transactions was not named by the group in the statement as it is a very minor case, an FGV spokesperson told NST Business.
FGV said the Board has undertaken internal investigations into six further matters which fall into three categories.
These are open credit lines, poor purchasing trading practices and poor palm oil sales that have resulted in bad debts of approximately RM100 million, direct awards of procurement contracts in breach of best practice.
This also includes the critical shortage of workers between May 2016 and April 2018 that resulted in financial losses exceeding RM170 million over the period.
FGV is reviewing all the above-mentioned findings and has sought legal advice on the possible legal recourse.
"In view of this, and as a matter of prudence, the Board will make further announcements on the next course of action after the Board has been duly advised,” it said.
While acknowledging responsibility to shareholders to generate and deliver value, FGV will refocus on its core competencies to restore the integrity of its operations.
"Furthermore, the board is committed to ensuring that the highest principles of corporate governance are instilled in all the Group’s employees, at all levels."
While FGV has always fulfilled the terms of the Land Lease Agreement with Felda, the company said there is still much room for improvement both operationally and in terms of financial management.
"Thus, while the board resolves the issues surrounding past investments and transactions that have depleted FGV’s cash resources, it will simultaneously strive to ensure that this critical turnaround plan is implemented,” FGV chairman Datuk Wira Azhar Abdul Hamid said in the statement.