K-Electric explains delay in preparation of financial statements and holding of AGM - FY17 and FY18

January 8, 2019 (MLN): K-Electric Company, in its various announcements has been informing and updating SECP, PSX and shareholders of the company on regular basis that due to non-availability of valid tariff for the year starting 10^th July 2016, the company could not prepare the financial statement on the basis of estimation in the absence of basic topline revenue number and hold AGM for FY17.

As per a notification issued to PSX on Tuesday, the company filed an application with the SECP and PSX on 25^th Sept 2018, in which the circumstances which led to delay in finalization and audit of financial statements of the company for the year ended 30^th June 2017 consequent delay in holding AGM for FY17 were duly explained.

Currently the matter is subjudice before Sindh High Court and due to stay order issued by SHC, the company can only convene AGFM for FY17, with the direction of SECP, after vacation of the said stay order.

Further, due to delay in holding of AGM for FY17 and finalization of financial statements for the said year, the company was not in a position to finalize the financial statements for the year ended 30^th June 2018, initiate audit process and hold AGM for FY18 within the specified time limit.

A certificate issued by company statutory auditors for FY17 confirmed that as the matter is subjudiced before Sindh High Court, audit of FY17 accounts will be further delayed for finalization of financial statements and audit for FY17. This will also impact upon the preparation of financial statements and audit process for the year ended 30^th June 2018, the notification added.

Moreover, the company added that the audit process of the financial statements will be further delayed due to appointment of new joint statutory auditors i.e. M/S A.F. Ferguson and Co. and M/S BDO Ebrahim and Co

Further, the company requested SECP that as there was no material change in the circumstances explained earlier, the company may be allowed to seek direction at a time when the company is reasonably certain about timing of AGM.

“New auditors have been engaged immediately after their appointment, audit process of financial statements for FY17 is in full swing and concerted efforts are underway to hold AGM for FY17 by the quarter ending 31’st March 2019”

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