|
Firms revise profit totals after audits
Auditing of the first-half financial statements of a number of listed companies has resulted in many issuing revised profit figures, raising investor doubts about the reliability of corporate financial disclosures.
This year has been the first in which publicly-traded companies have been required to disclose audited, semi-annual financial statements.
Net profits of Sacombank (STB) were adjusted downward by 35.5 per cent, from VND1.17 trillion (US$60 million) to VND755 billion ($38.7 million), following an audit of its financial statements, while profits of Vietinbank (CTG) also declined by VND552 billion ($28.3 million) and those of Eximbank (EIB) by VND110 billion ($5.6 million) after audits.
Profits of commercial bakery company Northern Kinh Do (NKD) also declined by 38 per cent from earlier reported figures, those of steel producer Asia Huu Lien (HLA) were reduced by 31.5 per cent, and those of Sacombank Securities Company (SBS) declined by 18.5 per cent.
The companies offered a number of reasons for the reduced profits, including foreign exchange losses or the need to set up provisionary risk management funds for financial investments.
Meanwhile, a number of companies have also reported significantly higher profits in the first half of the year, following audits of the financial statements.
Tan Tao Investment Industry Corporation (ITA) on Monday announced that its first-half profit rose from VND155 billion ($7.9 million) to VND460 billion ($23.6 million), attributing the difference to a dividend in shares worth VND305 billion ($15.6 million) that it holds in two subsidiaries.
ITA said that the adjustment would not change the overall result of the companies' combined financial statements, but ITA shares nevertheless responded positively to the higher profit figures, rising to their ceiling price on Tuesday on a volume of nearly 2.2 million shares.
Sai Gon Beverage Company (TRI) also posted higher profits on its revised financials for the first half. TRI now reports a profit of VND43 billion ($2.2 million) in the second quarter, reversing a previously announced loss during the period of VND20 billion ($1 million). Overall six-month profit therefore rose to VND14 billion ($718,000).
The change was attributed to gains realised by the withdrawal of capital from subsidiaries.
Shares of property developer Quoc Cuong Gia Lai Company (QCG) also rose from an initially reported VND13.4 billion ($687,200) to an audited total of VND61.4 billion ($3.1 million) .
A number of sharholders have been negatively effected by shifts in share prices caused by the release of adjusted financial disclosures.
Thang Long Securities Company Deputy Director Quach Manh Hao said that companies manipulating corporate profit totals was a widespread phenomenon around the world.
Hao said companies could manipulate the timing of revised figures to achieve better results in a public offering of shares or to attract investor interest. Employees could also exploit insider information by acting early to acquire or dispose of shares prior to the release of audited financial statements, he said.
vietnamnews
|
