KUALA LUMPUR: Minority shareholders of Serba Dinamik Holdings Bhd has expressed concern following the company's decision to undertake a special independent review on its statutory audit.
Minority Shareholder Watchdog Group (MSWG) chief executive officer and executive director Devanesan Evanson said this is because the matters highlighted by the external auditors are deemed serious enough to warrant the appointment of an independent firm to assess the veracity and accuracy of the highlighted matters.
"There is a dearth of relevant information as to the matters highlighted and this forces the minority shareholders to speculate as to what these matters may be," he told The New Straits Times today.
Earlier this week, Serba Dinamik Holdings said it is commencing a special independent review on some matters pertaining to statutory audit.
Some shareholders has expressed dissatisfaction with KPMG PLT as auditors in Serba Dinamik as the audit firm is involved in the 1Malaysia Development Bhd (1MDB) fiasco.
Serba Dinamik group managing director and group chief executive director Datuk Dr
Ir Ts Mohd Abdul Karim Abdullah in a statement said the management has taken prompt action to address the matters much earlier prior to the announcement made to Bursa Malaysia on 25 May 2021.
"As far as we are concerned, we have not changed our business structure materially since the initial public offering (IPO) in 2017 and have worked with KPMG, whose auditors
are familiar with our operations, since 2013.
"We have also engaged potential international independent firms to assess the veracity and accuracy of the matters brought up by the external auditor after consulting with Bursa Securities as time is now of essence given that we need to prepare for the Group's annual report for publication by 31 October 2021, resulted of change of our financial year end to 30 June," he said in a statement.
To a question on whether this special independent audit review impact shareholders and the day-to-day business of Serba Dinamik, said risk averse minority shareholders may use this information to make an informed investment decision.
"It is unfortunate that a better informed decision cannot be made by the minority shareholders as there is a lack of meaningful information in the announcement as to the nature of the matters highlighted by the external auditors.
Further, Devanesan said it is good corporate governance to rotate external auditors every few years as no independent party should remain for long periods of time as their independence would be impacted.
"Over time the external auditor will become more familiar with the management and the board so much so that they are no longer able to exercise independent judgment.
"The very concept of rotation of audit firms acts as a control on the incumbent auditors to act properly as they will know that one day, a new auditor will come in and their acts and omissions will be subject to review by the new auditor," he said.