BURSA MALAYSIA SECURITIES PUBLICLY REPRIMANDS VERSATILE CREATIVE BERHAD AND FINES ITS FORMER MANAGING DIRECTOR

Bursa Malaysia Securities Berhad [Registration No.: 200301033577 (635998-W)] (Bursa Malaysia Securities) has publicly reprimanded Versatile Creative Berhad (VERSATL) and its former Managing Director for breaches of the Bursa Malaysia Securities Main Market Listing Requirements (Main LR).  In addition, the former Managing Director of VERSATL was fined RM29,000.

VERSATL was publicly reprimanded for breach of paragraph 9.23(1) of the Main LR where VERSATL had failed to issue the annual report that included the annual audited financial statements together with the auditors’ and directors’ report for the financial year ended (FYE) 31 March 2018 (AR 2018) on or before 31 July 2018 (the Breach).  The AR 2018 was only issued on 14 September 2018.

Dato’ Wong Kong Choong @ Leong Kong Choong (Dato’ KC Wong), the former Managing Director and Group Chief Executive Officer of VERSATL had breached paragraphs 16.13(a) and (b) of the Main LR for causing and permitting knowingly or where he had reasonable means of obtaining such knowledge, VERSATL to commit the Breach. 

The finding of breach and imposition of the above penalties on VERSATL and Dato’ KC Wong were made pursuant to paragraph 16.19 of the Main LR upon completion of due process and after taking into consideration all facts and circumstances of the matter including the materiality of the breach, impact of the breach to VERSATL and shareholders/investors and the roles, responsibilities and conduct of Dato’ KC Wong.  

Bursa Malaysia Securities views the contravention seriously as the timely submission of financial statements is one of the fundamental obligations of listed companies and is of paramount importance in ensuring a fair and orderly market for securities traded on Bursa Malaysia Securities and necessary to aid informed investment decisions.

BACKGROUND

The delay in issuance of the AR 2018 was mainly due to the failure to resolve the audit issue on the prepayments/purported professional fees for land conversion services amounting to RM2.3 million (the Prepayments).  The audit issue was highlighted by the external auditors during the audit committee meeting on 24 May 2018 but VERSATL failed to resolve the audit issue expeditiously and ensure timely issuance of the AR 2018.  VERSATL was unable to procure and provide sufficient appropriate audit evidence and satisfactory explanations/justifications on the Prepayments to the external auditors which led to the appointment of an investigative audit on 3 July 2018 and gave rise to the external auditors’ qualified opinion in the audited financial statements for FYE 31 March 2018 announced on 7 September 2018.

Dato’ KC Wong had essentially caused the unresolved audit issue and the Breach by virtue of his roles, responsibilities, knowledge and involvement in respect of the Prepayments.  He had failed to discharge his duty particularly to ensure proper supervision, maintenance and provision of the supporting documents/records and satisfactory explanations/justifications on the Prepayments to resolve the audit issue and facilitate the preparation and timely issuance of the AR 2018.