Mazars issues disclaimer on Sun East’s audited finances

The company states that it has not been able to obtain sufficient appropriate audit evidence to provide basis for an audit opinion.

In a statement, Mazars said, “Pursuant to Rule 704(5) of the SGX-ST Listing Manual, the Board of Directors of the Company would like to announce that the independent auditors of the Company, Mazars LLP, have issued a disclaimer of opinion in the Report of the Independent Auditors contained in the financial statements of the Company and its subsidiaries for the financial year ended 30 June 2011.”

“Basis of disclaimer of opinion

Opening balances
The financial statements of the company and the group for the previous three (3) financial years ended 30 June 2008, 2009 and 2010 (or FYs 2008, 2009 and 2010 respectively) have each been qualified with a disclaimer of opinion by its auditors. The matters arising from the disclaimers are summarised below.

FY 2008
• scope limitation on the recoverability of trade receivables of the group amounting to HK$295,149,000.
● material uncertainties on the going concern of the company and the group FY 2009
● scope limitation relating to the loss of HK$286,025,000 on the disposal of the Sunlife Holdings Limited and its subsidiaries by the group.
● scope limitation relating to the existence and recoverability of HK$10,000,000 representing the consideration receivable from the purchaser in connection with the disposal of the SHL group against which a full provision for impairment had been made by the group. The auditors were also unable to satisfy themselves that the related provision for impairment loss for the aforesaid amount made by the group as at 30 June 2009 was appropriate.
● scope limitation relating to the recoverability of trade and other receivables amounting to HK$272,721,000. The auditors were also unable to satisfy themselves that the related provision for impairment loss for the aforesaid amount made by the group as at 30 June 2009 was appropriate.
● material uncertainties on the going concern of the company and the group.
● impact of the FY2008 disclaimer of opinion by the company’s auditors on corresponding figures.

FY 2010
● material uncertainties on the going concern of the company and the group.
● scope limitation on incomplete work by the auditors on subsequent events of the company and the group.
● impact of FY2009 disclaimer of opinion by the company’s auditors on corresponding figures.

The Company’s predecessor auditors, Deloitte & Touche LLP, Singapore (FY2008) and HLB Hodgson Impey Cheng, Hong Kong (FY2009 and 2010), had issued their disclaimers of opinion dated 7 October 2008, 7 September 2010 and 7 October 2010 on the consolidated financial statements of the Company and its subsidiaries for the financial years ended 30 June 2008, 2009 and 2010 respectively.

Owing to the disclaimers of opinion for the financial years ended 30 June 2008, 2009 and 2010, we were unable to determine if the opening balances of the Company and the Group are fairly stated and the corresponding figures in the current year’s financial statements which are derived from the financial statements for financial year ended 30 June 2010 are properly accounted for, presented and disclosed. Any adjustments to opening balances would have
consequential effects on the current year or prior year’s figures.

Disclaimer of opinion
Because of the significance of the matters described in the Basis for Disclaimer of Opinion paragraphs, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. Accordingly, we do not express an opinion on the consolidated financial statements as to whether they give a true and fair view of the state of affairs of the Company and of the Group as at 30 June 2011, and of the Group’s financial performance and its cash flow, and statement of changes in equity of the Company for the year then ended in
accordance with International Financial Reporting Standards.”