Auditors: Material uncertainty may cast doubt on Konsortium Transnasional as going concern

PETALING JAYA: Konsortium Transnasional Bhd's (KTB) independent auditors Messrs Jamal, Amin & Partners have expressed concerns over its ability to continue as going concerns as its current liabilities exceeded current assets by RM44.4 million and RM18.45 million at the group and company levels, respectively in its financial statement ended December 31, 2017.
"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," the auditors said.
It noted that KTB's ability to continue as going concerns are dependent upon it obtaining the support from the ultimate and penultimate holding companies; support funds from the relevant state governments and the Land Public Transport Commission (SPAD); the ability to generate adequate positive cash flows and future profits from its ongoing reorganisation of operations; raising additional cash flows from the sale of land and the support from creditors and lenders.
KTB, however, highlighted that it is already in the process of addressing the current liabilities and has successfully reduced its net current liabilities to RM44.39 million as at December 31, 2017 as compared with RM131.24 million as at December 31, 2016.
Out of the RM18.45 million net current liabilities, RM17.79 million represent net amount due to related companies.
It has continued to negotiate with creditors for extension/converting debts into few years repayment period of the existing short-term debts until the completion of its turnaround exercise.
KTB is also banking on revenue and financial support from its two separate agreements with SPAD to provide bus services under the MYBUS and Interim Stage Bus Support Fund (ISBSF) programmes.
At the noon break, KTB's share price was unchanged at 10 sen on some 3,000 shares done.