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Axington in search of new auditor, after proposed change of auditors falls through
AXINGTON is seeking a new auditor after a plan to switch auditors did not pan out.
In a regulatory filing on Tuesday, the company said it is in the process of reaching out to various audit firms to replace its current auditor Nexia.
Axington, formerly a professional services group, came under the control of cousins Nelson Loh and Terence Loh earlier this year.
Following the change of control, Axington said, there had been "preliminary discussions for a change of auditors to another audit firm".
Nexia had been informed and had received a professional clearance request from Axington's proposed audit firm on Aug 12.
The professional clearance process allows the prospective new auditor to receive confirmation from the previous auditor that there are no reasons that the new auditor should turn down the job.
On Aug 26, Nexia had sent this professional clearance letter to the proposed replacement audit firm. Nexia also submitted resignation letters to both the company's registered office in Labuan and its previous bussiness address in Kuala Lumpur.
Axington's board said this resignation was only "brought to their attention" on Sept 30. The board subsequently reached out to the replacement audit firm to confirm its earlier intention to accept the appointment, but was told that the firm would not be able to undertake the appointment.
The board then sought confirmation from Nexia of its intention to resign, which was reaffirmed on Oct 28. Nexia said this was "in light of the abovementioned professional clearance request and the recent developments of the company".
The resignation of Nexia, however, will only take effect upon the appointment of another auditor. Shareholders must also approve any change of auditors at an extraordinary general meeting (EGM).
Axington said it has received confirmation from Nexia that apart from S$4,200 worth of outstanding audit fees, Nexia is not aware of any professional reasons why any new auditors should not accept the appointment as auditors of the company.
Axington also said there were no disagreements with Nexia on accounting treatments within the last 12 months and that it is not aware of any other circumstances connected with the resignation of the auditors that should be disclosed to shareholders.
Axington has run into various difficulties since the Loh cousins acquired control of the company.
Most of its directors have resigned and the stock has been suspended. A proposed injection of a medical products distribution company into Axington will no longer take place, as the company had to postpone the EGM at which investors were to have voted on the deal.
The Lohs have faced scrutiny over multiple business dealings after it emerged that one of the companies they controlled had been circulating inaccurate marketing materials.