KUALA LUMPUR (May 20): Zelan Bhd said it has received a notice in writing from Messrs Afrizan Tarmili Khairul Azhar PLT (AFTAAS) of the latter’s decision to resign as its external auditor.

This came two days after AFTAAS expressed an unqualified opinion with material uncertainty related to going concern of Zelan’s audited financial statements for the financial year ended Dec 31, 2021 (FY21).

In a filing on Friday (May 20), the engineering and construction group said AFTAAS’ term of office shall end after 21 days from Friday.

“Further announcement will be made by the company on the appointment of a replacement auditor in due course,” it added.

AFTAAS drew attention to the company’s net loss of RM3.04 million in FY21 and noted that the group’s and the company’s current liabilities exceeded its current assets by RM186.89 million and RM21.67 million respectively.

“These events or conditions indicate that a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter,” Zelan said in a filing dated May 18.

AFTAAS said Zelan’s directors believe that there is no reason that the group will not generate sufficient cash from its operations within the next 12 months from the reporting date to repay the existing borrowings, complete the projects in progress and meet working capital.

Zelan shares finished unchanged at seven sen, giving the group a market capitalisation of RM59.14 million.