TWO former senior employees of UOB Kay Hian Private Limited (UOBKH) were charged on Wednesday for allegedly lying to the Monetary Authority of Singapore (MAS) in relation to reports on a then Catalist aspirant. Lan Kang Ming, 38, and Wee Toon Lee, 34, each face three charges of providing MAS with false information in October 2018 in relation to due diligence reports on an unidentified company applying to list on the Catalist board of the Singapore Exchange. MAS said in a media statement on Wednesday that it was performing an onsite inspection of UOBKH between June and August 2018, to assess the latter's controls, policies and procedures in relation to its role as an issue manager for Initial Public Offering (IPOs). During the examination, Lan and Wee were said to have provided different versions of a due diligence report relating to background checks on a company applying to be listed on the Catalist board of the Singapore Exchange. UOBKH had acted as the issue manager
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Andrea Sohsandrea
08 October 2014
Legal wrangling over the ownership of a subsidiary has made it difficult for the auditors of Magnus Energy to determine the accuracy of certain parts of its financial statements.
This has led auditing firm Moore Stephens to give a “qualified” opinion on Magnus Energy’s accounts for a second year, though it adds that the rest of the group’s financial statements and balance sheets for the financial year ended June 30, 2014, are properly drawn up.
The oil and gas equipment distribution and coal mining group holds coal concession rights through a subsidiary - PT Batubara Selaras Sapta (PT BSS) - that is currently the subject of a legal battle.
The Indonesian Ministry of Law and Human Rights had in 2008 told Magnus that another party was also registered as the legal owners of PT BSS. In November 2009, the Supreme Court of Indonesia upheld an earlier judgement by the High Court in not suspending the registration of the other party as the legal owner. Subsequently, the group was directed from submitting an application for a judicial review from the Supreme Court to a district court, which dismissed the lawsuit on the grounds that several individuals or parties named were not involved in the dispute.
After that, the group in June 2013 served “a Notice of Intent to Resolve Investment Dispute” to the Indonesian government, but had not yet heard from the government as at the date of the authorisation of the financial statements for the year ended June 30 this year. All mining activities at the concession have been suspended due to the continuing legal wrangling.
The legal complications also means that Magnus Energy’s directors were unable to determine the recoverable amount of its investment, causing the auditors to be unable to verify the investment figures and the tax deferred figures related to this investment.
The firm recorded its investment in the coal concession of about S$24.8 million in its consolidated balance sheet at cost after impairment losses as at June 30 this year. It also had a deferred tax liability of about S$7.2 million related to the investment. “Any adjustment to these amounts may have a significant consequential effect on the financial position of the Group as at 30 June 2014 and the results of the Group for the financial year then ended,” the auditors noted.
On top of that, another subsidiary Apac Coal Limited, in which Magnus had invested about S$492,000 and from which it had about S$646,000 due, indirectly holds the full 100 per cent interest in PT BSS. The investment amount of S$492,000 is after allowing for an impairment loss of about S$35.8 million.
The ability of Magnus to realise these two sums from Apac is largely dependent on the successful outcome of the legal proceedings over PT BSS’ ownership, said its auditors. Nevertheless, even after taking these into consideration, Magnus directors said that they believe that the group would be able to continue as a going concern, and would be able to continue to pay its debts when due.
Separately, the firm said that it had allotted and issued 5.56 million new ordinary shares at S$0.009 each to Phillip Securities to repay S$50,000 of an earlier loan. Magnus had said that it owed Phillip S$1.72 million under a cash loan bearing interest at 4.5 per cent a year. This was to be repaid over one year, starting from June 23, 2014. The firm had earlier issued some 59.4 million shares between the prices of S$0.0135 and S$0.0162 each for the same purpose.
The counter, which has fallen 69.7 per cent so far this year, closed unchanged at S$0.01 on Tuesday.