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Announcement On Qualified Audit Opinion And Emphasis Of Matter By Auditors On Financial Statements For The Financial Year Ended 31 December 2006
We refer to the qualified audit opinion from KPMG on the consolidated financial statements of China Petrotech Holdings Limited (the "Company") and its subsidiaries (the "Group") for the financial year ended 31 December 2006, a copy of which is attached herein.
The Company regrets to inform our investors and valued shareholders that our auditors, KPMG, does not express an opinion on the consolidated financial statements of the Group for the year ended 31 December 2006.
However, the auditors are of the opinion that the Company's balance sheet as at 31 December 2006 and statement of changes in equity for the year ended 31 December 2006 are properly drawn up in accordance with the provisions of the Companies Act (the "Act") and Singapore Financial Reporting Standards, and the accounting and other records required by the Act to be kept by the Company have been properly kept in accordance with the provisions of the Act.
We also note that KPMG has expressed its willingness to be reappointed as auditors.
While KPMG does not express an opinion as it is unable to verify certain items according to their audit procedures, the management of the Company would like to reaffirm its confidence in the financial statements including the collectibility of the accounts receivables in question, the appropriate recognition of turnover of the subsidiary, and the value of the investment in Ba Zhou Zhong You Yang Guang Oil and Gas Technology Co., Ltd.
This event arises partly due to weaknesses in our control system that did not meet KPMG audit standards.
The Company would also like to inform shareholders that it is taking immediate action to trace all the items in question to provide concrete evidence to the auditors. However, due to the inaccessibility of many offices and areas of our customers based in China, significant time is required for the Company to gather and present all the documents.
The Company will keep our shareholders informed of the developments.
- CPHL.independent.auditors.pdf (Size: 45,765 bytes)