Hascol Petroleum admits manipulation in accounts of 2019

KARACHI: Hascol Petroleum Limited has apprised the Pakistan Stock Exchange (PSX) of certain manipulation in its books during 2019, which might require Hascol to restate its past income statements as well as current and past balance-sheet.

Hascol also reported acceptance of the resignation of external auditors Grant Thornton for 2020 with immediate effect.

In a statement, Hascol Petroleum chairman Alan Duncan said that the company’s internal auditor received a whistleblower statement and evidence from within the company that in 2019 a series of false purchase orders were created and entered into the company’s books.

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“The internal auditor, as required by the procedure, referred the matter to the Board Audit Committee, which, at its meeting last week, concluded that there is sufficient evidence in support of the accusation to justify referring the matter to the full board of directors.”

“The board of directors has yet to receive a comprehensive report on what is alleged to have taken place, but is due to do so later this week. In the meantime, I consider it proper, through this statement, to immediately relay this information to the Securities and Exchange Commission of Pakistan (SECP) and the Pakistan Stock Exchange (PSX).”

“While the alleged statement, if proven correct, may require the company to restate its past income statements and past and current balance-sheets, it is not expected to make any material difference to the company’s recent and future operations.”

The Hascol Petroleum board of directors had decided to accept the resignation of Grant Thornton as its auditors for the year 2020 with immediate effect. The company expects the outgoing auditors to fulfil all their legal and professional requirements in respect of the years for which they were the company’s auditors.

In 2019, the company made a loss of Rs26 billion for the year ended December 30. In its recently released report for the third quarter of 2020, it has managed to make a loss of Rs20.90 billion.