Auditors give qualified opinion of Sri Lanka Anilana Hotels’ accounts

ECONOMYNEXT – Auditors M/s Amarasekera & Company, Chartered Accountants, have given a qualified opinion on the annual report for 2017-18 of Sri Lanka’s Anilana Hotels & Properties which has run up big losses.

The auditors have also flagged as a key audit matter revaluation of freehold lands and investment property of the firm, whose annual report has just been released to the stock exchange.

Singapore’s SOMAP International Pte Ltd recently acquired control of Anilana Hotels & Properties in a private placement of shares.

Auditors M/s Amarasekera & Company have drawn attention to material uncertainty related to the firm’s status as a going concern, noting that the company and group have incurred a net loss before tax of 1.6 billion rupees and 598 million rupees during the year ended 31 March 2018.

The accumulated losses reported as at the same date of the company and the group were 2.78 billion rupees and 2.28 billion rupees, the auditors said.

“Further, the current liabilities of the company and the group exceeded its total assets by  889,580,322 rupees and 1,091,373,204 rupees,” the audit report said.

“These events or conditions, along with other matters as set out in Note 31, have cast an uncertainty over the company’s and group’s ability to continue as a going concern. However, in consideration of the assertion given by the directors under the same note, our opinion is not qualified in respect of this matter.”

Anilana Hotels & Properties directors have said the losses were “primarily due to finance costs incurred by the group arising from related party borrowings and company borrowings together with the impairment of assets.”

The Board of Directors said the group requires a capital restructure and the management is in the process of restructuring in order to de-leverage the gearing position of the group.

“The Directors are confident that the Group would return to profitability, and the net current liability position would improve as a result of the aforementioned capital restructure.”

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They also said Anilana Hotels & Properties group is supported with continuous financial assistance by the parent company, Singapore’s Somap, from 03 August 2018, if it needs assistance in the short term.

Accordingly, the directors said, they believe the group is able to continue as a going concern.
(COLOMBO, 10 December 2018)
 

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