Malaysian oil and gas services firm Serba Dinamik rejects auditor’s concerns

Kuala Lumpur, Malaysia. Photo by Kah Hay Chee on Unsplash

Malaysian oil and gas services firm Serba Dinamik Holdings Bhd said it did not see any problems with more than 3.5 million ringgit ($847 million) of contracts and transactions questioned by its auditor.

In a stock exchange filing on Friday, Serba Dinamik said KPMG had not been able to verify contracts and transactions with 11 customers.

“The company takes the view that there is no issue with regards to the legitimacy and existence of the contracts as well as the value that will render any material impact to the financial and operational aspects of the group for the financial year ending June 30,” it said.

Serba Dinamik said it planned to appoint an independent firm to “review the accuracy and veracity” of the issues raised by KPMG.

The issues highlighted by KPMG comprised sales transactions of 2.3 billion ringgit, a trade receivables balance of 652 million ringgit and a materials on site balance of 569 million ringgit, the company said.

Serba Dinamik said in another filing on Friday that a non-independent non-executive director, who is also a shareholder with 15.96% equity, had proposed convening an extraordinary general meeting to remove KPMG as auditor, and hire BDO in its place to audit the same period.

In a statement on Saturday, Serba Dinamik said it was unfair of KPMG to have stopped the audit and request an independent review without engaging further with management, as well as to have only highlighted the issues close to the deadline for the company to announce its accounts.

“We have provided sufficient information … and full cooperation to the auditors to satisfy their extended procedures requirements. Somehow we were informed that they were unable to obtain confirmation from some of our customers,” Group Chief Executive Officer Abdul Karim Abdullah said.

KPMG could not immediately be reached for comment.

Serba Dinamik shares have been suspended since it announced on Tuesday its external auditors had flagged some matters related to its statutory audit. The company did not give details at that stage.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.