SLAASMB wants Agalawatte Plantations’ annual financial statements re-audited

The Sri Lanka Accounting and Auditing Standards Monitoring Board (SLAASMB) last week directed the troubled regional plantation company Agalawatte Plantations PLC (AGAL) to have its annual financial statements for the 2014 financial year be re-audited.

A SLAASMB letter circulated by the Colombo Stock Exchange said that AGAL has time until October 12 to inform by which day the company can re-audit its financial statements, and to publish and circulate copies to all parties that received its annual report for the year.
The decision has been made under the Sri Lanka Accounting and Auditing Standards Act No. 15 of 1995, section 28, subsection (2) which deals with offences not of a serious nature committed by a business or an auditor.
AGAL’s auditor is Hulugalle Samarasinghe & Co., had found nothing unseemly in its clients’ books.

“In our opinion, the consolidated financial statements give a true and fair view of the financial position of the company and its subsidiaries dealt with thereby as at December 31, 2014, and of its financial performance and cash flows for the year then ended, in accordance with Sri Lanka Accounting Standards,” it had said.
The fate of the ownership in AGAL is currently in the hands of the country’s judicial system.
Mackwoods Group Chairman Dr. Chris Nonis, who is also the Chairman of AGAL, had sold the entire 60.80 percent shareholding of Mackwoods in AGAL to Browns Power Holdings (Pvt) Ltd this July, which raised a red flag with the Securities and Exchange Commission.
The market regulator had pointed out that Dr. Nonis was not authorized to sell shares of AGAL, and halted the Rs. 304 million in share sale proceeds from being transferred to him.

The two largest shareholders of Mackwoods have now filed suit over the matter. However, since the shares were transferred to Browns Power Holdings, they have now announced their intentions to issue a mandatory offer, since failure to do so would be in violation of the Company Take-overs and Mergers Code.