Wednesday, April 16, 2008

Welli: Charged with Cooking Their Books

Published on Business Times: Charged with cooking books


  • Charged with cooking books

    Published: 2008/04/16

    The Securities Commission says two former Welli Multi directors, the Ang brothers, falsified company accounts in the 2005 annual report and quarterly reports for 2006

    THE Securities Commission has charged two former directors of Welli Multi Corp Bhd with falsifying company accounts, about 10 months after it first took action against the palm kernel crusher.

    The regulator has sued Ang Sun Beng, 62, the former managing director of Welli and his younger brother Ang Soon An, 58, who was also a former executive director.

    "Upon conviction, the accused persons are liable to a fine not exceeding RM3 million or to imprisonment for a term not exceeding 10 years, or both," the SC said in a statement released yesterday.

    They were charged with falsifying accounts in its 2005 annual report where Welli posted a revenue of RM573 million and a net profit of RM5 million.

    They were also charged with manipulating the numbers for the first three quarters of fiscal 2006, which ends on December 31.

    In addition, the SC has fined Welli's former executive director and chief executive officer, Tan Chin Han, RM100,000 for authorising the submission of the 2006 third quarter accounts.

    The Ang brothers have claimed trial to the charges.

    Judge Rozana Ali Yusoff imposed bail of RM150,000 with one surety on each of them and ordered them to surrender their travel documents. She fixed May 9 for mention.

    In February, the SC told the Business Times that it may take legal action against those who cooked the books at Welli. It had said that investigation was at an advanced stage.

    Initial investigations revealed a number of bankers acceptance notes were issued by the company to "questionable" companies.

    In June 2007, Welli was told to withhold releasing quarterly accounts and the annual audited accounts for the period to March 31 2007.

    This was to verify the authenticity and recoverability of some RM113 million worth of trade receivables.

    The Penang-based palm kernel processor, listed on the second board, was instructed to rectify and re-issue its accounts.

    Welli then re-issued its accounts up to the period ended December 31 2006 in February this year, reporting a net loss of RM17.61 million.

Well, it's really great to read about all this happening.

Another thing, here's another example to pay attention to them trade receivables in the balance sheet.

Remember the old saying, a sale is never a sale until the money is collected!

0 comments: