Serba Dinamik Annual Report 2021

150 Independent Auditors’ Report to the Members of Serba Dinamik Holdings Berhad Registration No: 201501042584 (1167905-P) (Incorporated in Malaysia) Report on the Audit of the Financial Statements Disclaimer of Opinion We were engaged to audit the financial statements of Serba Dinamik Holdings Berhad, which comprise the statements of financial position as at 30 June 2021 of the Group and of the Company, and the statements of profit or loss and other comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the period then ended, and notes to the financial statements, including a summary of significant accounting policies, as set out on pages 10 to 148. We do not express an opinion on the accompanying financial statements of the Group and the Company. Because of the significance of the matters described in the Basis for Disclaimer of Opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements. Basis for Disclaimer of Opinion The chronological events summarised below and where applicable, detailed in the Notes on the Financial Statements highlights the backdrop of circumstances and scenario under which we were appointed auditors of the Company.  5 May 2021 - In the course of the performance of its duties as auditor and prior to completion of its audit, KPMG reported to Bursa Malaysia Securities Berhad (“Bursa”) and the Securities Commission pursuant to Section 320(1) of the Capital Markets & Services Act 2007 (“CMSA”) that there were matters which may affect to a material extent the financial position of the Group and of the Company;  7 May 2021 - The financial year end of the Company was changed to 30 June 2021;  22 June 2021 - The Company filed a Writ of Summon together with the Statement of Claim at the High Court of Malaya at Shah Alam against KPMG;  23 June 2021 - KPMG resigned as auditors;  2 July 2021 - The Board under the directive from Bursa pursuant to paragraph 2.23 and 2.24 of the Main Market Listing Requirements of Bursa had formally appointed Ernst & Young Consulting Sdn. Bhd. (formerly known as Ernst & Young Advisory Services Sdn. Bhd.) (“EY”) as the special independent reviewer to assist the Board in undertaking a special independent review of the matters raised by KPMG.  3 August 2021 - We were appointed as auditors of the Company. As statutory auditors, we have undertaken the audit procedures necessary to enable us to conclude on the appropriateness of, inter alia, the Group’s recognition of revenue, purchases, receivables, payables and inventories for the 18-month period up to 30 June 2021. These procedures have been impeded by time limitations and occurrence of additional significant events impacting the completion of our audit. Other considerations were that in view of the timing of our appointment, we were not in a position to observe the counting of physical inventories at the end of the period. Alternative means to verify the inventory quantities held at 30 June 2021 is still pending. Additionally, there are significant matters which we require that are outstanding at the date of our report and we have not been able to compile sufficient appropriate audit evidence to provide a basis for our audit opinion.