News | Wednesday, 26 August 2009

Mambra auditor unable to certify accounts

Charlot Zahra

The auditors of Mambra Electronics, the Luqa store which recently closed down after the disappearance of director Joseph Pavia, had made warnings to the company about various irregularities in Mambra’s accounts, this newspaper has learnt.
Arthur Douglas Turner, the company’s registered auditor at the time, had even refused to certify Mambra Electronics’ Limited’s Abridged Financial Statements for the Financial Year ending 31 December 2006.
In the Auditor’s Report for that year, Douglas Turner had warned that the company had “included with creditors falling within one year of Lm567,919 there was VAT payable of Lm2,904 which could not be verified.
“Further during the year under review, indirect taxation and eco-tax payable are not properly reported as to amounts extracted from the accounting system.
“Consequently, no audit procedure could be performed to test the completeness and veracity of amounts declared and reported in the financial statements,” Douglas Turner said.
Moreover, the Auditor’s report highlighted the fact that “no stock count was carried out on 31 December 2006 and there were no practical alternative auditing procedures that I could apply to confirm quantities.
“Accordingly, I am unable to determine the values and existence of stocks included in the balance sheet at year and amounting to Lm422,309.
“In confirming amounts, I had to rely on directors’ confirmation of balance,” he explained.
In his report, the Mambra auditor also warned that “included with trade and other receivables of Lm374,322 there were other debtors’ balances of Lm81,709 that could not be confirmed.
“This balance is the result of accounting adjustments necessitated by weaknesses in the accounting system,” Douglas Turner explained.
“I had to rely on directors’ confirmation of balance and there were no alternative auditing procedures that I could adopt to confirm independently the values at balance sheet date.”
Furthermore, the Mambra auditor warned that “the evidence available to me was limited as the company can only operate limited internal control procedures and there are no practical audit techniques by which to determine the effect of this limitation.”
In his concluding opinion, the auditor warned that “because of the possible effect on the limitations in evidence available to me, I am unable to form an opinion on the true and fair view of the state of the financial position of Mambra Electronics Limited as at 31 December 2006, and of its financial performance and its cash flows for the year then ended.”
These were the last set of accounts that were filed by the company at the Companies’ Registry on 06 December 2007.
As a result, on 25 June 2009, a few days before the company closed its doors, Douglas Turner tendered his resignation as auditor of Mambra Electronics’ Limited at the Companies’ Registry.
In the company’ Financial Statements for the previous year ending 31 December 2006, the auditor had already warned about the lack of a stock count on 31 December 2005 and that there were no alternative auditing procedures to determine quantities, therefore he was not able to determine the values and existence of Lm428,873 stocks listed in the company’s balance sheet.
The company closed its doors at the beginning of August after taking a three-week shutdown.
Mambra, which was renowned for consumer electronics selling at rock-bottom prices, had announced a sale after the shutdown, but when costumers went to the Luqa store, they found that the establishment was still closed and that the Mambra logo from the façade had been removed.
Director Joseph Pavia had since disappeared from Malta, and not even his father, Carmel, who is also listed as a director of the company, knew where his son fled to.
Three warrants of seizure have been filed against Mambra by the VAT Commissioner for €308,809 unpaid eco-contributions, and by private firms John G. Cassar Limited and Emanuel Vella and Sons Limited for a few thousands.



Other News

Unemployment increases by 1,563 over June 2008

LGA picks licensee as its landlord

Demise of young retailer shocks business community

FIMBank plc announces half-yearly results

Mambra auditor unable to certify accounts

Maltese IT company’s profits plummet during first half of 2009

Four listed companies meet to approve half-yearly financials

Government bonds: what’s the story?

Home Thoughts on Civic Awareness and Responsibilities

Becoming literate in new media

Cash for clunkers





26 August 2009


Malta Today


Collaborating partners:



Copyright © MediaToday Co. Ltd, Vjal ir-Rihan, San Gwann SGN 07, Malta, Europe Tel. ++356 21382741, Fax: ++356 21385075
Managing Editor: Saviour Balzan