Sakae clarifies what it meant by 'close collaboration' with SGX's regulatory arm

SAKAE Holdings on Tuesday clarified its use of the word "collaboration" in describing its interactions with the Singapore Exchange Regulation (SGX RegCo).

This came after SGX asked the sushi chain to clarify and explain what Sakae meant when it said it "appreciates the close collaboration and working relationship it has with the SGX RegCo" in a May 20 announcement.

"SGX RegCo has not collaborated with the company on any pieces of work," SGX noted in its query on May 21.

Sakae said in its response that it takes the word "collaboration" to mean "to work with another person or group in order to achieve or do something".

"The company wishes to clarify that the use of the word 'collaboration' should be taken to mean that both KPMG and Deloitte have reported to the company's audit committee (AC) and SGX RegCo, in relation to the independent audit of the company's investment in Cocosa Export and reconciliation of the intragroup differences," Sakae said.

In its statement on Tuesday, Sakae said it has cooperated with SGX RegCo on regulatory matters and will continue to do so.

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Sakae had appointed KPMG Services to conduct an independent audit on the company's investment in Cocosa Export - a Chilean company Sakae had invested in.

Meanwhile, Deloitte was engaged to perform an agreed-upon procedure in relation to the reconciliation of the intragroup differences identified in the auditor's report of the company and its subsidiaries for the year ended June 30, 2019.

On May 12, the SGX RegCo flagged erroneous accounting entries and internal control weaknesses which arose from KPMG's independent review of the company.

Sakae's May 20 announcement sought to address concerns from Securities Investors Association (Singapore), or Sias, over the company's audit disputes.

Sakae said its internal selection of independent professional internal auditors and the scope of internal audit are approved by its AC - which also receives the internal auditors report directly.

The company also highlighted that its implementation of policies which address the recommendations have been done progressively since July 2019.

Sakae shares last traded at 14.4 Singapore cents on April 6.