10 July 2017 09:50 am
Agalawatte Plantations PLC (AGAL) had continued its sub-standard accounting practices in 2015, the firm’s auditors said in the audited financial statements for the year, after earlier this year stating the same had happened during 2014.
“We have not obtained all the information and explanations that were required for the audit and, as far as appears from our examination, proper accounting records have not been kept by the company,” auditors Hulugalle Samarasinghe & Co. said. It added that the group financial statements did not comply with the Companies Act No. 07 of 2007.
AGAL, which was controlled by the Mackwoods Group until the end of the 2015 financial year, was divested in a controversial trade by Mackwoods Group Chairman Dr. Chris Nonis in mid-2016 to the Browns group, which then divested it to the Damro group earlier this year.
The auditors said that the new director board was not able to provide information on whether there were any frauds or irregularities involving AGAL management or employees, that the financial statements were accurate, contractual obligations of the firm were met and whether it held satisfactory title to all assets.
According to Hulugalle Samarasinghe & Co., AGAL had not been able to provide documentary evidence items on the profit and loss statement and the balance sheet which ran into hundreds of millions of rupees.
Further, the company secretary had not been present at 10 of the 13 AGAL board meetings in 2015.
Hulugalle Samarasinghe & Co. reaudited AGAL’s 2014 financial statements due to a regulatory direction and found a similar situation in that year’s accounts, even though it had given the 2014 financial statements a thumbs up in the original audit by stating that it gave “a true and fair view of the financial position”.
The auditor said that there were significant doubts over the company’s ability to continue as a going concern, due to continuous loss making and since its total liabilities exceeds its total assets. (CW)