Magnus Energy's auditor qualifies opinion over coal concession investment

INDEPENDENT auditor of oil-and-gas company Magnus Energy on Monday issued a qualified opinion on the company's financial statement for the year ended June 30, 2016.

It noted the impairment loss of about S$15 million that was recognised for the group's investment in coal concession rights. The impairment loss comes after deducting the related deferred tax credit of about S$6.1 million.

The auditors from Moore Stephens said the final impairment loss would depend on the ongoing legal proceedings over the group's ownership interest in PT Batubara Selaras Sapta, which holds the coal concession rights.

The auditors have not been able to determine "the validity and appropriateness of the carrying amount of the group's investment in the coal concession rights" given the uncertain outcome of the legal proceedings, they said.