Cokal says ‘financial irregularities and fraudulent activity’ impacted results
Mining & Resources
Coal miner Cokal is investigating “possible financial irregularities and fraudulent activity” that have impacted its 2018 financial figures.
In a publicly-released ASX announcement, Cokal (ASX:CKA) said on Friday the irregular activities concern the company’s chief financial officer and seven more employees.
It says the group of seven employees notified the Cokal board they received monies totalling approximately $150,000 from a supplier of barging services to the company in Indonesia.
Back in August, Stockhead reported that Cokal had received the funding it needed to build the first stage of its Bumi Barito Mineral project in Indonesia.
It says “appropriate measures” will be taken with regards to the CFO and relevant employees when the investigation is finished.
Further, Cokal says it has allegedly been charged for services not incurred and/or charged non-arm’s length amounts for services provided by that supplier.
“Further investigation is taking place to confirm whether the group’s barging expenses have been validly incurred by the group, whether the cost of barging services received represented an arm’s length price for those services, and the amount of the payments made and expenses accrued for the barging services that should be accounted for as other expenses on the basis they had been misappropriated,” Cokal said in a statement now publicly-available on the ASX website.
“The company notes that amounts are currently still outstanding and payable to this supplier, which will not be paid until the investigation is complete. Some of the money received by the employees has been refunded and the board is confident that with this, and the outstanding amounts owing being reduced by agreement with the supplier, there will be no financial loss to the company.”
Cokal says a new organisation structure has been put in place under chief James Coleman to future-proof similar issues, and says that its annual report, being audited by Ernst & Young, has been delayed until next week.
Cokal was suspended from trade by the ASX at the start of October following “failure to lodge the relevant periodic report for the period ended 30 June 2018 by the due date”, alongside 11 other companies.
On October 15, it told investors that its 2018 annual report would be lodged at some time this week, saying that “limited staff resources have caused delays as the company has been operating on a lean financial basis”.
Its most recent quarterly report showed just US$29,000 cash in the bank.