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Pacific Healthcare may not be going concern: auditor
STRUGGLING medical services provider and nursing home operator Pacific Healthcare Holdings may not be a going concern, its independent auditor has warned. The auditor also said that it could not give an audit opinion on the group's financial statements.
Pacific Healthcare said in a Singapore Exchange (SGX) filing on Friday that its auditor, Baker Tilly TFW, had included a disclaimer of opinion in its report on Pacific Healthcare's financial statements for the FY ended Dec 31, 2015.
Baker Tilly noted in its report, dated April 7, that Pacific Healthcare had incurred a loss of S$1.94 million for the FY and that the group was in a "net current liability position" of S$6.53 million and "net liability position" of S$2.12 million as at Dec 31 last year.
Minus subsidiaries in the overall group, the company Pacific Healthcare alone was in an even worse net current liability position of S$11.76 million and net liability position of S$8.80 million, Baker Tilly pointed out.
"These factors indicate the existence of a material uncertainty which may cast significant doubt about the group and the company's ability to continue as going concerns," Baker Tilly said.
It went on to say that in view of this "material uncertainty" and "the lack of sufficient appropriate audit evidence in confirming whether the major shareholders would continue to provide additional funding for the group's working capital requirements, we were unable to conclude whether the use of the going concern assumptions in the preparation of these financial statements is appropriate".
"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 financial statements."
The stock has been suspended since July 2015, after Pacific Healthcare said in June 2015 that the SGX was going to delist it because it was unable to meet requirements for removal from SGX's watchlist.