Hengyang Petrochemical Logistics' auditors flag firm's going concern uncertainty

THE ability of China-based Hengyang Petrochemical Logistics to operate as a "going concern" is in doubt, said its auditors BDO LLP.

The group had incurred a net loss of about 13.4 million yuan (S$2.8 million) for the 2015 financial year, and its current liabilities then exceeded current assets by about 430.9 million yuan.

"These conditions indicate the existence of material uncertainties that may cast significant doubt about the group's and the company's abilities to continue as going concerns," said BDO.

Hengyang Petrochemical Logistics' directors, however, believe the firm has "adequate liquidity" for its working capital requirements for the next 12 months, based on its enlarged storage capacities and expected orders from major customers.