To the Members of Fintec Global Berhad
Registration No.: 200701016619 (774628-U) (Incorporated in Malaysia)
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS cont’d Key audit matters cont’d
(ii) Impairment of amount due from subsidiaries
(Refer to Note 2(g)(i), 2(k) and 16 to the financial statements)
The gross carrying amount of the amount due from subsidiaries amounted to RM152,618,210. The Company carries significant amount due from subsidiaries which are subject to a high credit risk exposure.
Due to the significance of the amount due from subsidiaries in determining the probability of default we consider this to be an area of audit focus.
Our procedures included:
(a) Assessed and tested reasonableness of the Company’s expected credit losses model, and key assumptions made by management; and
(b) Assessed whether financial statements disclosures are adequate and appropriately reflect the Company’s exposure to credit risk, arising from subsidiary companies.
Information Other than the Financial Statements and Auditors’ Report Thereon
The Directors are responsible for the other information. The other information comprises the Management Discussion and Analysis, Audit Committee Report, Corporate Governance Overview Statement and Statement on Risk Management and Internal Control and Sustainability Report but does not include the financial statements of the Group and of the Company and our auditors’ report thereon.
Our opinion on the financial statements of the Group and of the Company does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements of the Group and of the Company, our responsibility is to read the other information identified and, in doing so, consider whether the information is materially inconsistent with the financial statements of the Group and of the Company or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Statements
The Directors are responsible for the preparation of financial statements of the Group and of the Company that give a true and fair view in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. The Directors are also responsible for such internal control as the Directors determine are necessary to enable the preparation of financial statements of the Group and of the Company that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements of the Group and of the Company, the Directors are responsible for assessing the Group’s and Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or the Company or to cease operations, or have no realistic alternative but to do so.
Independent Auditors’ Report
To the Members of Fintec Global Berhad
Registration No.: 200701016619 (774628-U) (Incorporated in Malaysia) cont’d
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS cont’d Auditors’ Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements of the Group and of the Company as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with approved standards on auditing in Malaysia and International Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
z Identify and assess the risks of material misstatement of the financial statements of the Group and of the Company, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
z Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s and of the Company’s internal control.
z Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.
z Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s and the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements of the Group and of the Company or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group and the Company to cease to continue as a going concern.
z Evaluate the overall presentation, structure and content of the financial statements of the Group and of the Company, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
z Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial statements of the Group. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide the Directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguard applied.
From the matters communicated with the Directors, we determine those matters that were of most significance in the audit of the financial statements of the Group and of the Company for the current year and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Independent Auditors’ Report
To the Members of Fintec Global Berhad
Registration No.: 200701016619 (774628-U) (Incorporated in Malaysia) cont’d
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
In accordance with the requirements of the Companies Act, 2016 in Malaysia, we report that the subsidiaries of which we have not acted as auditors, are disclosed in Note 11 to the financial statements.
OTHER MATTERS
This report is made solely to the members of the Company, as a body, in accordance with Section 266 of the Companies Act 2016 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.
PKF NG CHEW PEI
AF 0911 03373/06/2022 J
CHARTERED ACCOUNTANTS CHARTERED ACCOUNTANT
Kuala Lumpur 28 August 2020
Independent Auditors’ Report
To the Members of Fintec Global Berhad
Registration No.: 200701016619 (774628-U) (Incorporated in Malaysia) cont’d
Group Company
2020 2019 2020 2019
Note RM RM RM RM
Revenue 3a 20,372,349 15,357,478 - 692,703
Cost of sales (19,791,288) (14,113,965) - -
Gross profit 581,061 1,243,513 - 692,703
Other operating income 3b 242,702,869 794,388 1,235,548 -
Administrative expenses (6,957,646) (6,037,274) (6,552,364) (3,909,223)
Net (loss)/gain on financial assets at
amortised cost (5,243,233) (5,660,032) 7,596,171 (140,517,722)
Other operating expenses (4,285,355) (30,245,413) (373,194) (323,840)
Profit/(Loss) from operations 226,797,696 (39,904,818) 1,906,161 (144,058,082)
Finance cost 5 (764,832) (152,554) (28,675) -
Profit/(Loss) before tax 226,032,864 (40,057,372) 1,877,486 (144,058,082)
Tax income 6 - 6,000 - -
Profit/(Loss) for the financial year 226,032,864 (40,051,372) 1,877,486 (144,058,082) Other comprehensive income/(loss),
net of tax
Items that may be reclassified subsequently to profit or loss
Currency translation differences 237,619 - - -
Total comprehensive (loss)/income for the
financial year 226,270,483 (40,051,372) 1,877,486 (144,058,082)
Profit/(Loss) attributable to:
Owners of the parent 226,041,683 (40,015,298)
Non-controlling interest (8,819) (36,074)
226,032,864 (40,051,372) Total comprehensive income/(loss) for the
financial year attributable to:
Owners of the parent 226,279,302 (40,015,298)
Non-controlling interest (8,819) (36,074)
226,270,483 (40,051,372) Earnings/(loss) attributable to owners of the
Company per Ordinary Share (sen)
- Basic (sen) 7 33.76 (6.72)
- Diluted (sen) 7 16.55 (2.69)