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Auditor gives qualified opinion on Yamada's FY19 results
THE auditor of Yamada Green Resources has given a qualified opinion for the mushroom supplier's financial results for the year ended June 30.
This is due to the extent of spillover on the fiscal 2019 statements from the disclaimer of opinion given in fiscal 2017 and fiscal 2018, said independent auditor Foo Kon Tan in its report disclosed by the company on Thursday.
A qualified opinion was provided on the uncertainty of the possible impact to the assets, liabilities and income statement for fiscal 2019, which the auditor said may be "affected and impacted by any circumstances not known of as at the date of the report".
One issue highlighted was that of an unaccountable balance of 29.3 million yuan (S$5.7 million) relating to a residual sum which could not be represented as at June 30, 2018.
For fiscal 2019, Yamada management had tried to authenticate whether the residual sum – which is standing as a credit balance – is a liability, income or deferred income.
"In this regard, the China subsidiaries' legal counsel has conducted legal due diligence processes to verify this residual sum and its completeness," the auditor report noted.
The management also believed the residual sum should be fairly represented as non-distributable reserve standing in equity, given the passage of time and because the sum was derived from the reconstruction of the books and records since fiscal 2017 and fiscal 2018.
On this basis, the auditor is of the opinion that the stating of the residual sum as non-distributable reserve as at June 30, 2019 has been "satisfactory resolved and dealt with".
As for the spillover of disclaimer of opinion for fiscal 2017 and fiscal 2018, the matters regarding the moso bamboo and eucalyptus plantation and the processed food products exported to Japan were also found to be satisfactorily dealt with.
Except for these matters highlighted, the group's consolidated financial statements and its statement of financial position were said to be properly drawn up in accordance with the provisions of the Companies Act, Chapter 50 (the Act) and Singapore Financial Reporting Standards (International).
The company's shares are currently suspended.