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Troubled flooring firm Jason Holdings releases 2015 results; S$4.3m reversal made
TROUBLED timber flooring specialist Jason Holdings, which is facing corporate governance and debt repayment issues, has released its unaudited adjusted half-year and full-year results for 2015.
The firm made a S$13.8 million loss for the full year compared to a S$215,000 net profit in 2014. Revenue fell S$23.2 million in 2015 from S$40 million in 2014. The declines were due to a slump in the construction sector, less upgrading by households, inventory write-offs and discounts given to customers.
For the half-year, audit firm BDO, engaged to perform certain limited tests on revenue and cost numbers, found that S$4.3 million of revenue in the period should not have been recognised as such. The revenue came from billing clients without having shipped the goods over in what is known as "material-off-site claims". Certain criteria had to be met before these claims can be recognised as revenue, and the firm did not meet these criteria.
Thus the S$4.3 million was reversed out of Jason Holdings' half-year income statement. This led to a S$4 million loss for the adjusted half-year results.
For the half-year, some revenues and costs in their respective schedules provided to BDO did not match the company's main accounting records in the general ledger. The revenue schedule was lower by S$155,000 and the cost of goods sale schedule was lower by S$238,000 compared with what was recorded in the general ledger.
Earlier, audit firm EY had found potential breaches of fiduciary duties in the management of the firm, and CEO Jason Sim and operations director New Sze Wei have been suspended.
Jason Holdings is also facing a winding-up application, as well as potential lawsuits from unpaid contractors and banks.
The Catalist-listed firm is currently suspended from trading.