T. T. Al Nakib, a shareholder of Hunter and Company Ltd (Hunters) has requested an extra-ordinary General Meeting (EGM) in a bid to resolve some accounting discrepancies in the company.
This came just as Hunters asked its auditors Ernst & Young to resign in a dispute over disclosure in the company annual report.
In a letter to Hunters' Company Secretary, Mr. Nakib (with 15.58 percent shareholding in the company) has moved to convene an EGM to be held on Wednesday, July 23 to seek an explanation from Hunters' directors with regard to the disappearance of a Rs.2.5 million cheque in favour of Mr. Mahesh Gajanayake and about directors' remuneration over and above the limit set out in the company's articles.
Mrs. L. R. P. Dossa, daughter of former Finance Minister Ronnie De Mel, is the main shareholder of the company with 70.31 percent. Hunters counts 97 years of business in Sri Lanka, having been established in 1911 in the country.
On the firing of the auditors, Ernst & Young, veteran investor K. Vignarajah said the “directors have taken the role of appointing the auditors even fixing their remuneration, and comically dismissing them.”
Mr Vignarajah who said he has repeatedly raised the issue of the need for creating healthy independence of auditors and independent directors, asked “why should the auditors resign? It is neither correct, nor is it fair and equitable. The directors should be called upto to explain and account for the actions queried by the auditors.”
In most cases auditors and independent directors have “sheepishly and shamelessly comfortably accepted appointments from the controlling interests the Board of Directors for ample perks and benefits, to betray the interests of the investing public and other stakeholders,” he added.