In a filing with Bursa Malaysia, Country View said that the acquisition
KUALA LUMPUR: Konsortium Transnasional Bhd (KTB) independent auditors, Messrs. Jamal, Amin & Partners have expressed concerns about the prospects as the current liabilities exceeded its current assets.
The bus transport company said on Monday the independent auditors had in its report dated March 26, 2018 stated that for the year ended Dec 31, 2017, the Group's and Company's current liabilities exceeded its current assets by RM44.39mil and RM18.45mil respectively.
“These conditions indicate the existence of a material uncertainty which may cast significant doubt about the ability of the group and the company to continue as going concerns,” it said.
The independent auditors highlighted that the ability of the group and the company to continue as going concerns depended on several factors.
They said these factors would hinge on the group obtaining the support from its holding companies, obtaining support funds from the relevant state governments and the Land Public Transport Commission (SPAD) to be disbursed to the private stage bus operators including the group.
Other factors are the ability to generate adequate positive cash flows and future profits from its ongoing reorganisation of its operations, raising additional cash flows from the sale of lands and obtaining the continuing supports of creditors and lenders.
The financial statements of the group and the company do not include any adjustments relating to the amounts and classification of assets and liabilities that might be necessary should the going concern basis of preparation of the group's and the company's financial statements be inappropriate.
In response, the board said the independent auditors have expressed an unqualified opinion on the financial statements for the year ended Dec 31, 2017 and “that their opinion is not modified in respect of the financial statements on that matter”.
The board said the KTB group had already started the process of addressing the net current liabilities.
Firstly, KTB was continuing to negotiate with the creditors for extension/converting debts into few years repayment period of the existing short term debts until the completion of the group's turnaround exercise.
Secondly, KTB had reduced the group's net current liabilities as at Dec 31, 2017 (RM44.39mil) as compared to the group's net current liabilities at Dec 31, 2016 (RM131.25mil).
Thirdly, out of the RM18.45mil net current liabilities of the company, RM17.79mil was net amount of amount due to related companies. KTB’s ultimate and penultimate holding company are maintaining their commitments to continue their supports for the operations of the company.
Fourthly, KTB had two separates agreements with SPAD to provide bus services under the MYBUS and ISBSF programs. The revenue and financial supports, respectively, from both programs are significant and enable the group to continue servicing its current financial commitments.
Fifthly, KTB said it would continue to focus on cost optimisation and stringent cash flow management and maintaining safety and quality services to remain competitive.
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