Duty comes first
KUALA LUMPUR: Auditors should be allowed to carry out their responsibilities and render their independent opinion without fear or favour and discharge their duties free from any retaliation, the Securities Commission’s (SC) Audit Oversight Board (AOB) has said.
“External auditors play an important role in promoting confidence in the quality and reliability of audited financial statements in Malaysia, ” the regulator said in a statement yesterday.
“Auditors are also required to exercise their professional scepticism during their audit and always apply the International Standards of Auditing as adopted by the Malaysian Institute of Accountants, ” the SC AOB noted.
Serba Dinamik said at a press conference on Tuesday that it would be taking legal action against KPMG for alleged negligence, breach of contract and breach of statutory duty.
The SC also said that it had an investigation ongoing on Serba Dinamik.
The regulator also denied it had spoken to Serba Dinamik’s chairman Datuk Mohamed Ilyas Pakeer Mohamed as mentioned by a newsletter yesterday.
“In light of recent events, the SC wishes to reiterate that under the Capital Markets and Services Act 2007, auditors have a statutory obligation to immediately report to the SC, if they reasonably believe that there are any matters which may constitute a breach or non-performance of any requirement of securities laws, rules of the stock exchange or any matter which may adversely affect to a material extent the financial position of the listed company, ” the regulator said.
Meanwhile, following a query from Bursa Malaysia, Serba Dinamik said that following its suit against KPMG, it would be deliberating tomorrow whether the scope of its independent reviewer Ernst & Young Advisory Services Sdn Bhd has to be expanded or otherwise.
Bursa Malaysia had queried the company on the status and timeframe for the appointment of the independent reviewer to assess the veracity and accuracy of the matters as earlier highlighted by KPMG.
“Based on legal advice, the company is of the view that KPMG can no longer act independently as external auditors. The company will make an immediate announcement to this effect immediately upon the finalisation of the aforesaid scope of work, ” Serba Dinamik said.
It was reported that Serba Dinamik’s board had early last week agreed in principle to appoint Ernst & Young Advisory Services as its independent reviewer to assess the veracity and accuracy of the matters highlighted by KPMG.