BSEC unveils several anomalies at Meghna PET
The investigation team prepared a report based on its findings and submitted it to the enforcement department of the Bangladesh Securities and Exchange Commission (BSEC) in the beginning of this year.
An inquiry team from the securities regulator, after visiting the factory premises and head office of Meghna PET Industries Limited last year, has found multiple irregularities at the listed pet bottle-maker.
The investigation team prepared a report based on its findings and submitted it to the enforcement department of the Bangladesh Securities and Exchange Commission (BSEC) in the beginning of this year.
According to BSEC sources, the team found that Meghna PET's production was suspended from 2004, but the company did not inform the news as price sensitive information.
Keep updated, follow The Business Standard's Google news channel
Besides, in its FY21 annual report, the company has shown Tk6.34 crore as property, plant and equipment. But its factory has been closed for nearly two decades. Such a long-time closure requires an impairment test, but the company did not do that. As a result, the value of property, plant and equipment is misleading.
What's more, the company showed Tk2.26 crore worth inventories in its report, where in reality, there was no inventory in its factory, according to the BSEC team.
Furthermore, the company's management has failed to provide evidence to authenticate its loans and deposits.
Also, the team found that the company appointed the same individual as a chief financial officer and company secretary, which is a violation of the BSEC order. But somehow, there are signatures from two different persons as chief financial officer and company secretary in the company's financial statement.
The commission had called the company's owners and management in a hearing to prove themselves as innocent against the inquiry team's findings.
In the hearing, Meghna PET Director Alamgir Hossain and Company Secretary provided a written statement to BSEC. The statement said that the Meghna Group has two participations—Ka and Kha.
"We have several complexities in separating the two groups. The Kha group always tries to harass us. They have even occupied our land without handing it over to us. Besides, we have a capital crisis. And because of these reasons we are not able to do business," Hossain wrote in the statement.
But the commission was not satisfied with this statement. As a result, it fined Chairman Muhammad Zakaria and Managing Director MF Kamal of Tk1 crore each and three directors Wali Ullah, Kabir Ahmed and Abu Taher Tk50 lakh each for violating the securities laws.
