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Tuesday May 1, 2012

Metronic external auditors qualify accounts

PETALING JAYA: Metronic Global Bhds external auditors have expressed a qualified opinion with regards to some financial statements in its financial year ended Dec, 31 2011 (FY11) that remained unresolved. The company posted details of the qualification by its external auditors, Messrs LLTC, to Bursa Malaysia. A companys accounts are qualified by its auditors when they doubt that the picture of the companys activities presented is true, complete and fair. Similar to the previous years audit qualification, we are unable to obtain sufficient appropriate evidence about the timing of collection of these receivables, we are unable to determine if any adjustment to the impairment amount and thus the net carrying amount of these receivables, Messrs LLTC said. It was referring to Note 22(A) of the financial statements which showed that the company had long outstanding receivables due from a former related party and certain group of receivables with their carrying amount totalling RM46.6mil as at Dec 31, 2011, of which a total impairment amount of RM21mil has been made. Referring to Note 16 and Note 18, it said: Unilink Development Ltds financial statements and other documentary evidence are not available for our audit and there are no other audit procedures that we can rely on to ascertain the appropriateness of the net carrying amount of the investment, and any further impairment required for the said investment. Unilink, a former associate of Metronic, had alloted 416 new shares of HK$1 each to Zonemax Holdings Ltd, the other shareholder during the financial year as a result of the exercise of option by Zonemax to convert part of an outstanding loan payable and due from Unilink to new shares. In response to the qualified opinion, Metronic said: In our opinion, except for the possible effects of the matters described in the basis for qualified opinion paragraph above, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial positions of the group and of

the company as at Dec 31, 2011 and of their financial performance and cash flows for the year then ended. Last April, Metronics then external auditors, Ernst & Young, had expressed a qualified opinion in their report on the companys 2010 financials. Ernst & Young subsequently declined to be re-appointed as its auditors for the following year. Metronic, in which Datuk Raymond Chan Boon Siew bought a 5.1% stake several weeks ago, has been on the active list for a while now, ending yesterday the third most actively-traded on volume of 30 million shares. The shares lost one sen to 17.5 sen.