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Best World appoints PwC to examine franchise model
BEST World International on Tuesday said it has appointed independent reviewer PricewaterhouseCoopers Consulting (PwC) to examine its franchise model, after The Business Times raised concerns in February over the challenges in tracking sales of its DR's Secret line of premium skincare products in China.
The group said that PwC's review will focus on the franchise model adopted by the company in China in 2018. Its objectives will be to verify the existence of the franchisees as at Dec 31, 2018, validate the sales to and cash received from sales to significant franchisees, and identify and make appropriate recommendations on any internal control weaknesses and breaches of the Singapore Exchange (SGX) listing manual, regulations or local laws.
The scope of work includes site visits to the business locations of the franchisees, conducting targeted reviews on the franchisees' sales and purchase records, reviewing the physical flow of inventory, reviewing internal controls surrounding sales to franchisees and recommending improvements where applicable.
PwC will report its findings directly to Best World's audit committee and the SGX RegCo. Best World said it will make further announcements as and when there are material developments on the matter.