TREK: Ernst & Young has lodged a report with the Accounting and Corporate Regulatory Authority (ACRA) against OSIM-linked TREK 2000 over discrepancies relating to several sale transactions.
In a filing with the SGX, TREK disclosed that the auditor's concerns relate to documentation for certain sale transactions between its subsidiary and a consumer worth US$3.2m.
Essentially the discrepancies relate to:
1) Identity of the customer between TREK's sales system and its books
2) Delivery orders acknowledged by customer vs airway bill
3) Payer identity on bank transfer payments of US$2.65m
In addition, TREK is currently undergoing an Interested Party Transaction (IPT) inquiry surrounding transactions with T-Data Systems.
The auditor's report to ACRA comes after two of TREK's independent directors resigned in late Mar.
OSIM recently took a 8.79% stake in TREK 2000 with the initial block acquired in Jul '15. The lifestyle counter intends to work with TREK 2000 to apply the latter's patents and technology in its products.
In the wake of the complaint, Trek has converted its trading halt into a suspension.