Editor’s Note: Correction was made to delete the page numbers of the originating summons, and renovation costs and rental deposits by Goodway Marketing Sdn Bhd.
TECHNICAL rubber compound specialist GIIB Holdings Bhd (formerly Goodway Integrated Industries Bhd) may have breached the core corporate governance principle of transparency by concealing an originating summons (OS) served on the company by its former executive director Wong Weng Yew on May 19.
Wong, 38, who is also a shareholder of GIIB with a 6% stake, coincidentally had his services terminated on the same day after the company’s external independent auditor found sufficient basis to hold him accountable for misconduct per the charges made against him in a show cause letter dated March 28 this year.
The OS sighted by FocusM has named as defendants GIIB’s executive chairman Tai Boon Wee, executive/alternate director Tai Qiyao, fellow executive director Tai Qisheng, non-independent non-executive director Wong Ping Kiong and the company itself.
According to GIIB’s Annual Report 2020, Wong was appointed as an executive director of GIIB on Feb 23 last year whereby he was made responsible for managing the group’s finance and accounting operations.
Prior to joining GIIB, he was attached to PricewaterhouseCoopers LLP in Singapore where he managed and provided advisory for business processes, IT auditing and security review. Overall, he has more than 10 years’ experience in business advisory and auditing.
In his OS, Wong, among others, disputed the reasons given by the company to change its financial year end to June 30, 2022 from Dec 31, 2021, notably to facilitate the recent investigation into the management and its handling of the glove business as well as the accounts of the company and its subsidiaries.
Claiming the reasoning as falsehood, Wong said the company’s auditor Grant Thornton Malaysia PLT has in fact issued a disclaimer of opinion in its draft audited accounts of the company that “ … we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements”.
This follows the requirement by GIIB to file its Annual Report 2021 and unified financial statements for its financial year-ended Dec 31, 2021 on or before April 30, 2022.
“If the disclaimer is made public, GIIB would have triggered a Practice Note 17 (PN17) situation with all the transactions ultimately exposed to the public and market authorities,” the OS pointed out.
“But with the change of its financial year-end from Dec 31, 2021 to June 30, 2021, GIIB only has to announce the unified financial statements or draft audit accounts on or before Oct 31, 2022.”
In a reply to a query by Bursa Malaysia dated May 23 with regard to the details of suspicious transactions in the group as highlighted by Wong on May 16, GIIB highlighted four items, namely:
- Sale of machinery by GIIB Rubber Compound Sdn Bhd for the amount of RM2.95 mil;
- Sale of assets by Big Wheel Green Tyres Sdn Bhd and settlement of dispute amounting to RM2.68 mil and RM5 mil respectively;
- Renovation costs by Goodway Marketing Sdn Bhd amounting to RM62,000, and rental deposits and utilities (RM16,000); and
- Alleged owing from the director amounting to RM786,062.
With regard to the expected timeframe to appoint an independent audit firm and to commence the forensic investigation into the group’s financials, GIIB told Bursa Malaysia that it expects the appointment to take place by end-May with the independent audit firm expected to commence its forensic audit in early June 2022.
Recall that Wong had on April 25 lodged a police report at the Ibu Pejabat Polis Daerah Nilai in respect of the contentious matters involving GIIB.
“On the matter of the investigative committee that was recently set up by GIIB, I am yet to receive any update,” he noted in a media statement back then.
“Further, I understand that the committee consists of, among others, a family member of GIIB’s executive chairman, Tai Boon Wee. Notwithstanding the committee members, it is hoped that the committee is able to remain impartial.
“The fact that the committee consists of a family member of the executive chairman appears to be poor governance,” added Wong.
At the close of yesterday’s (May 26) market trading, GIIB was unchanged at 7.5 sen with 2.8 million shares traded, thus valuing the company at RM44 mil. – May 27, 2022