Wednesday, June 16, 2010

SC Warns On Destroyed Documents

On Business Times

  • SC warns firms not to destroy documents

    Published: 2010/06/16

    THE Securities Commission Malaysia (SC) yesterday issued a stern reminder to directors and principal officers of public-listed companies (PLCs) of the severe consequences of destroying or causing loss of company documents.

    Under the Capital Markets and Services Act 2007, it is an offence to destroy, conceal, mutilate or alter any record or account with the intent to defraud any person, or to prevent, delay or obstruct investigations, the SC said yesterday.

    Upon conviction, offenders are liable to a fine of up to RM10 million or imprisonment for up to 10 years or both, it said in a statement.

    According to SC chairman Tan Sri Zarinah Anwar, it is completely unacceptable that a company that is under investigation suddenly turns around and claims that documents are lost or stolen.

    "I am reminding directors of PLCs that they are ultimately responsible for the safe custody of company documents and can be held liable for the loss of such documents," Zarinah said.
    "Someone who assists another person to destroy documents also commits a wrong. So I am sending a strong warning to company employees and others who act on the instructions of those further up the corporate chain," she said.

    Zarinah warned that the SC would not not hesitate to take action against anyone responsible for the destruction, loss or removal of any company records.

    The SC said it was extremely concerned that in some of the cases under investigation, documents central to the investigations had been reported lost, destroyed or even stolen.

    "While recognising that there could be genuine cases of loss, there appears to be losses which seem to have occurred under extremely questionable circumstances," it said.

    The commission called for heightened vigilance on the part of company directors, auditors and key company officials with regard to the safeguarding of all company documents.

    The SC also reminded auditors that they have a duty to report any breaches of securities laws or rules of the stock exchange or any matters which may adversely affect the financial situation of a PLC to the authorities.

    "This is a critical role of auditors who are expected to bring a level of independence and professionalism to the process of financial disclosures," it said. - Bernama

I believe that article should be addressed to Axis Inc.

Axis Inc Lodges Police Report!

All I want to repeat say is that in 2007, Axis Inc the stock had a bumper year.

Stock soared on the basis that the company's business had reported fantastic growth. With the fantastic growth came incredible surge in trade receivables.

So the stock soared in 2007.

In 2008..

  • Axis Inc Bhd may have to write off RM161 million in its 2008 accounts as its auditor could not find enough evidence to show that the company could recover the amount. ..... One is an amount of RM105 million due from contract manufacturers, which is part of other receivables as at March 31 2008. ( see Update on Axis Inc )

Yup... all hell broke loose in 2008.

Now Axis said.. cannot find.. missing... so it lodged a police report.

Think about it... record sales drove the stock up in 2007... in 2008.. records cannot verify those sales and receivables..... 2010.. those records now missing!

Yup.. completely unacceptable!