BSEC orders special audit into Shurwid’s accounts

Highlights

• The company has allegedly been giving a false sense of hope to the investors
• Submitted false dividend disbursement report
• BO accounts of sponsors, directors and top officials frozen
• Factory closed since March 26
• EPS Tk1.89 in the first nine months of 2019-20

The stock market regulator has appointed a special auditor for Shurwid Industries Limited to investigate the company's financial statements.

Howladar Yunus & Co Chartered Accountants will audit the statements of June 30, 2019, and December 31, 2019, within the next 30 working days.

Shurwid has allegedly been giving a false sense of hope to the investors. And the deceived investors have been holding the company's shares repeatedly.

So, the Bangladesh Securities and Exchange Commission (BSEC) wants to get a real picture of the company now.

A change in Shurwid's management in 2017 created hope among investors.

In May 2018, the company decided to lower its paid-up capital to minimise accumulated loss.

Failing that, Shurwid tried to diversify its business to generate more income.

And the board of directors of the company recommended a 10% cash dividend for the year ended June 30, 2019.

On January 29, the company reported it had disbursed cash dividends to its shareholders for the financial year that ended on June 30, 2019.

Later, several shareholders complained to the regulator that they did not receive any dividend. And the regulator found the claim to be true.

As the company lied about dividend disbursement, the BSEC ordered to freeze all types of securities in the beneficiary owner (BO) accounts of the company's top officials.

Also, the commission asked the Bangladesh Bank to freeze all types of bank accounts of the company and its directors except for the ones' of independent directors.

Shurwid was listed on both the stock exchanges in 2014.

The company of Tk57.37 crore paid-up capital posted Tk0.37 earnings per share (EPS) in the financial year 2018-19.

It also posted an EPS of Tk1.89 in the first nine months of the financial year 2019-20 and its net asset value per share stood at Tk14.11 on March 31, 2020.

In June 2020, Shurwid informed the stock exchanges they had to temporarily shut down their factory due to the Covid-19 pandemic from March 26.

Sponsors and directors now hold only 12.01% stake in the company, institutional investors 19.21% and general investors 68.78%.