Chemicals group Rolfes has been publicly censured by the JSE for publishing financial results that were filled with a raft of accounting errors.

The company’s share price lost almost a third of its value in September 2017, when it shocked the market by saying it would need to restate its results, including for the years to end June 2015 and 2016, due to accounting errors and the understatement of impairments.

The JSE said on Tuesday it had imposed public censure for the material errors, which do not comply with listing requirements regarding financial statements that are prepared according to international standards.

Among the material errors, there had been an overstatement of inventories, an overstatement of trade and other receivables, and an understatement of interest-bearing loans.

Rolfes said on Tuesday it strongly disagreed that the censure was appropriate. While it had become aware the results did not comply with accounting standards, at the time they had been presented to the board by management and audited without qualification.

“When the errors and issues were identified in 2017, the company immediately notified the JSE, restated the previous results in the 2017 financial statements and replaced its CEO and CFO,” the company said.

Lizette Lynch had resigned as CEO in October 2017, replaced by then CFO Richard Buttle. Buttle's position was filled by Andre Broodryk in November.

“It is clear that the company acted decisively and appropriately, and the points raised in the censure are precisely what the company itself had notified to the JSE,” the statement on Tuesday read.


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