Surefire Resources pretty sure it can stay afloat despite financial woes
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Despite its auditor flagging financial issues and the ASX quizzing whether its annual report follows accounting standards, Surefire Resources believes it can pay off more than $1 million in debt and remain in business.
Fremantle-based Surefire (ASX:SRN) reported a loss of $1.6 million last year and liabilities of $746,944 — while its cash position came in at a paltry $20,554.
Surefire’s auditor, Greenwich and Co, said there was material uncertainty that may cast significant doubt on the company’s ability to continue as a going concern.
But in response to an ASX query, Surefire assured investors it would continue as a going concern, paying its debts when they become due.
The base metals explorer said $1 million in debts owed to its biggest creditors — entities related to Surefire non-executive director Vladimir Niklaenko — had been extended until September 30, 2018.
Surefire, formerly known as Black Ridge Mining, also has $200,000 available in a drawdown facility with Vargas Holdings — a company also associated with Mr Nikolaenko. Proceeds from the facility are planned for working capital.
The auditor also provided a “Qualified Opinion” in Surefire’s annual report.
A qualified opinion is a statement issued after an audit is done that suggests information provided was limited in scope and/or the company being audited had not maintained accounting principles.
The auditor said it had been unable to access information relating to the remuneration of former key management Trent Spry and Dom Valentino and their related entities and therefore were unable to provide a sufficient audit of the company’s remuneration.
In response, Surefire said the board was seeking to get a copy of Mr Valentino and Mr Spry signed service agreements.
“The current board has taken steps to ensure all contracts and agreements entered into by the company with key management persons must be securely stored to substantiate the validity, accuracy and completeness of recorded remuneration payments for all future reporting periods,” Surefire said.
Mr Valentino stepped down as executive director in May this year while Mr Spry stepped down as CEO in January.
Surefire shares remained unchanged at 0.1c in Monday lunchtime trade, valuing the minnow at $2.4 million.