Friday, January 05, 2007
@3:54 PM
Xpress Holding: cause for concern?I came across this news about 3 weeks ago. Today, this company is in the news again because the editor is encouraging the shareholders to post more questions to that decision by the board of directors. I definitely share the editor's view.
[Extract] There could be conerns, not just about Xpress breaching an AGM deadline, but about the root cause of that breach: the auditors's refusal to sign off on Xpress's FY2006 accounts and the company's decision to subsequently sack the auditors. [Summary] In short, Deloitte is Xpress's external auditor. Deloitte had doubts on some revenue item records and also raised concerns about the internal controls. After Deloittle's refusal, Xpress then hired Fon Kon Tan Grant Thornton as an independent accountant. Foo Kon Tan then declare the records isn't far from accurate and indicated its willingneess to act as Xpress's auditor. Xpress then asked Deloitte to resign and moved to hire Foo Kon Tan.Tell me. If an auditing firm rather resigns then to sign off the client's accounts, what does it implied? If a company can easily sack its original auditor who doesn't "goes with the flow", then what's the protection for shareholder? Why did
Xpress go for a relatively smaller local auditor when it can hire any of the remaining Big 4? If Foo
Kon Tan and
Deloitte hold opposing views, who has more credibility? Why is there a need to sack? Why can't the directors comply with
Deloitte's request? Is there really something
fundamentally wrong with the financial statements?
by Str|fe
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