DURBAN – Pembury Lifestyle Group (PLG) and its previous auditors, Moore Stephens, are headed for a collision course after the auditing firm served the group with a liquidation application regarding the fees charged for the year to the end of December 2018.
PLG, which has a focus on education, said on Friday that it would oppose the liquidation application served by Moore Stephens.
TThe group announced in July last year that it was changing its auditors by mutual consent with Moore Stephens due to the growth of the group, the pending rotation of the audit partner and the company needing a larger audit firm with an in-house International Financial Reporting Standards adviser, as the main reason for the change.
But the group indicated during the termination process that it would consider using the services of Moore Stephens for projects or internal audit going forward, due to their knowledge of the group.
However, on Friday, PLG advised its shareholders that Moore Stephens has served separate applications for the provisional liquidation on the company.
The liquidation was served on the company’s three divisions, Pembury Schools, PLG Retirement Villages and PLG Properties.
“PLG will be opposing these liquidation applications as it is disputing the fees charged by Moore Stephens in respect of the audit of the group for the financial year to end December 2018. The board will, however, also be attempting to settle the matter amicably,” the group said.
PLG listed on the Alternative Exchange of the JSE in March 2017.
It is not the first time that the group has faced a liquidation application.
Last month, the group settled a 2018 legal matter after it was incorrectly cited as owing Artificial Grass SA an amount of R483765 for work that was carried out at two of its schools.
PLG said the work was contracted by Kygoway, the company constructed to do work for the schools and retirement villages.
The group said the dispute was between Artificial Grass SA and Kygoway around the quality of the workmanship and Artificial Grass SA applied for the liquidation of the PLG as a means of enforcing payment due by Kygoway.
However, the matter was settled amicably in January and the liquidation process was withdrawn.
In the six months to the end of June, the group reported a 23percent increase in revenue to R55million, boosted by the Pembury Schools division’s learner numbers. which increased to 2458 learners, up from 2185 a year earlier.
Its headline loss a share improved by 84.62 percent to 0.08c loss compared to a loss of 0.52c.
Pembury Lifestyle Group shares closed 20 percent lower at R0.04 on the JSE on Friday.