CAELY HOLDINGS BHD CAELY (7154) appoints forensic auditor to look into suspicious transaction allegations at subsidiary

 CAELY HOLDINGS BHD  CAELY (7154) appoints forensic auditor to look into suspicious transaction allegations at subsidiary

KUALA LUMPUR (April 7): Caely Holdings Bhd has appointed Virdos Lima Consultancy (M) Sdn Bhd as its independent forensic auditor to look into allegations of suspicious and irregular transactions at its wholly-owned subsidiary Caely (M) Sdn Bhd (CMSB).

The Perak-based lingerie manufacturer did not disclose any other information regarding the allegations in its filing with Bursa Malaysia on Thursday (April 7).

However, its auditor PKF had previously issued a qualified opinion on Caely’s audited financial statements for the year ended March 31, 2020, in relation to CMSB’s ability to recover certain receivables.

The auditor had highlighted that CMSB had trade receivables of close to RM12 million as at March 31, 2020, related to construction works for Felcra Bhd which were completed on Feb 28, 2018.

However, only RM250,000 repayment was received by the company since completing the works, attributed to the change of government and the Covid-19 pandemic.

PKF said all payments for the construction had been delayed and in view of the prolonged delay, the carrying amount of trade receivables may be impaired due to the uncertainty over the recoverable amounts.

“We are uncertain of the full recovery of certain trade receivables of the group amounting to RM11.995 million as at financial year end, as a substantial amount on the completed constructions payments have not been received.

“We were unable to obtain sufficient and appropriate audit evidence on the impairment assessment of the abovementioned carrying amount of the said receivables in accordance with MFRS 9 Financial Instruments. Consequently, we were unable to determine whether any adjustments to these amounts were necessary,” the auditor had said.

On the other hand, the board of Caely had assessed and concluded that there should not be any impairment loss on the trade receivables.

Caely’s share price closed unchanged at 56.5 sen on Thursday, giving it a market capitalisation of RM145.45 million.

http://www.theedgemarkets.com/article/caely-appoints-forensic-auditor-look-suspicious-transaction-allegations-subsidiary