Mudajaya finds 'irregular transactions' in its books

by **Cals** Sun 22 Mar 2015, 22:57

Mudajaya finds 'irregular transactions' in its books

By Foo Yen Ne / theedgemarkets.com | March 20, 2015 : 9:53 PM MYT

KUALA LUMPUR (March 20): [size=14]Mudajaya Group Bhd (Mudajaya) ([You must be registered and logged in to see this image.] Financial Dashboard) announced today that it has uncovered irregular transactions in its books involving a former employee, which led to enlarged costs incurred on a specific project.

Mudajaya said irregular transactions in the project was uncovered by its internal management working group.

"On instructions of the board, an internal management working group conducted a comprehensive review of additional costs incurred on a specific project undertaken by the Group which was included in the Group's 2014 fourth quarter report that was announced on 27 February 2015.

“The working group that conducted this internal investigation has uncovered some irregular transactions leading to additional costs incurred on a specific project,” said Mudajaya’s chairman Datuk Yusli bin Mohamed Yusoff in a press release filed with Bursa Malaysia this evening.

Information from the review suggested the issue was confined to an isolated case involving one former employee and that it is restricted to only one of the company’s projects, the statement read.

Yusoff also stressed all costs relating to the particular project and to the financial results of the group have been fully accounted for in the company’s books.

“There is also no impact on the operational performance of the project or to other projects undertaken by the group, nor to any of our customers, suppliers or partners," he said.

“With the information at hand, we are confident that moving forward, no further provisions for costs are required beyond what was reported. We have also acted to strengthen internal control and governance structures,” he added.

Mudajaya (fundamental: 1.15; valuation: 1.8) said internal investigations on the irregular transactions are still on-going, and that it has referred the matter to relevant authorities and has obtained legal advice on its next course of action.

It has also commissioned an international audit firm to assist the group on the matter.

Meanwhile, it assured investors it has strengthened internal control and governance structures, following the discovery.

Mudajaya reported a net loss of RM99.71 million in its fourth quarter ended Dec 31, 2014 (4QFY14), compared to a net profit of RM22.9 million a year ago; revenue for the quarter was at RM188.75 million revenue — down 43.55% from RM334.34 million previously.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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