JSE censures chemicals group Rolfes over accounting errors

The Johannesburg Stock Exchange has taken the step of publicly censuring Rolfes Holdings [JSE:RLF] for previous errors in its financial statements, a move the chemicals group says it disagrees with. 

On Tuesday, the local bourse said the company’s annual financial statements for the years ended June 2015 and 2016 contained "material errors", which were then restated in an earnings report for the year ended June 2017. According to the JSE, the errors spanned the overstatement of property, plant and equipment; the overstatement of inventories; and the understatement of interest-bearing loans.

But Rolfes, in an update to shareholders, said it disagrees that the public censure is warranted as it that it had already replaced its CEO and CFO in response to the errors.

"While the company subsequently became aware that the 2015 and 2016 reported results did not comply with IFRS (International Financial Reporting Standards) and the JSE listings requirements, at the time of publication they were the results as presented to the board by management and audited without qualification," it said. 

Rolfes said that when the errors were identified in 2017 it took decisive and appropriate action, including immediately notifying the JSE, restating the results and replacing its CEO and CFO.

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