MIYOSHI’s board of directors is of the view that chief executive and executive director of the company Andrew Sin should continue in his role.
This comes despite Sin being fined S$22,400 by Singapore’s State Court last Friday (Jan 10), for failing to recognise an impairment loss in the company’s financial statements for the fiscal year ended Aug 31, 2019.
In a filing on Monday, the metal components maker said that the nominating committee has recommended to the board, which has accepted its recommendations, that Sin should continue as chief executive and executive director of the company, for the following reasons:
First, Sin has been instrumental to the group and the performance of his duties “has not been compromised nor impeded by this incident”.
Second, apart from the fine imposed and to the best of the board and Sin’s knowledge, there have been no other conditions or restrictions imposed by any regulatory authority on Sin.
Sin has also “consistently demonstrated the soundness of character and integrity expected from a director of a listed company on the Singapore Exchange”, said Miyoshi.
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It also pointed out that the group continues to require Sin’s expertise, experience, as well as his relationships with business partners and other stakeholders of the group, which he has “accumulated over more than 30 years since founding the group”.
The accounting irregularity came to light after the group’s audited financial statements were selected for review by the Accounting and Corporate Regulatory Authority (Acra) in September 2021, as part of the authority’s financial reporting surveillance programme.
The national regulator found that Miyoshi had engaged an independent valuer to assess whether the equity investment was impaired. Despite the valuer’s draft report confirming a significant impairment, Miyoshi did not recognise the impairment loss and overstated its net asset value by the same amount.
Acra said that the S$16 million impairment loss came from a decline in the value of the company’s equity investment in Core Power (Fujian) New Energy Automobile.
Had Miyoshi recognised the impairment loss, the group’s loss before income tax would have widened to S$16.8 million, from S$486,000 logged in the company’s 2019 audited financial statement.
Its total assets would have also reduced by 19 per cent to about S$67.9 million as opposed to the S$84.2 million recorded.
Miyoshi on Monday also said that Sin’s sentencing is not expected to have an impact on the group or on the company’s business and operations.
The company called for a trading halt after Acra’s announcement last Friday and requested to resume trading on Monday morning. Shares of Miyoshi were unchanged at S$0.004 as at 10.14 am on Monday.
