12 report accounts deviations in a day

02-05-2008: 12 report accounts deviations in a day
by Sharmila Ganapathy


KUALA LUMPUR: As many as 12 companies, the majority of which are listed on the Second Board, reported deviations between their unaudited and audited accounts for the financial year ended Dec 31, 2007 on Wednesday.

Topping the list by variance size was Main Board-listed Englotechs Holding Bhd, which reported a 720% deviation between its unaudited and audited FY07 profit after tax figures.

Englotechs reported unaudited net profits amounting to RM3.14 million versus the audited RM19.5 million audited net losses reported for the year.

In a filing to Bursa Malaysia, it said the variances were due to a RM14 million provision of doubtful debts and net unrealised foreign exchange losses.

“The cost of research and development has been expensed off due to failure to fulfil the criteria of Approved Accounting Standards. Taxation decrease was due to deferred taxation overprovided,” the company added.

Second Board firm MESB Bhd announced a deviation of 624.3% with its audited accounts showing a net loss of RM561 million against the unaudited RM107 million net profits for the period.

The company attributed the sizeable variance to the change of accounting policy in relation to the recognition of project costs incurred on construction of telecommunication towers.

The project costs, MESB said, had previously been recognised as contract expenses. The company had since changed its policy to discontinue this recognition, the company said.

Eden Inc Bhd, which was in the news early this month for aborting its planned RM120 million Sukuk Ijarah programme, reported a 77% deviation amounting to RM1.23 million and RM281,000 respectively.

It had made a provision of RM233,000 for gain on dilution of interest in a foreign subsidiary, RM1.07 million on preliminary expenses of a foreign subsidiary inadvertently capitalised, RM100,000 in under provision of depreciation and RM10,000 for other provisions.

Another firm announcing significant variance was Thong Guan Industries Bhd, which reported a 42.4% or RM8.84 million difference.

The company reported higher unaudited net profits amounting to RM12 million. It explained that the deviation resulted from a combination of correction of accounting errors (due to a foreign currency translation error), under provision of taxation, overstatement of inventory and other provisions.

Second Board-listed industrial products player PJ Bumi Bhd reported a 41% variance, with its audited net loss widening to RM18.11 million from the unaudited figure of RM12.84 million.

PJ Bumi listed the provision for doubtful debts, renovation and written off office equipment, provision of income tax and tax penalty, and other provisions as reasons for the deviation.

The remaining seven companies, however, reported considerably smaller percentages of deviations in net profits/losses ranging from between 3% and 20%. They are Limahsoon Bhd, Ta Win Holdings Bhd, Rex Industry Bhd, APP Industries Bhd and Fitters Diversified Bhd, CNLT (Far East) Bhd and Frontken Corporation Bhd.