KUALA LUMPUR (Aug 1): Software developer Asdion Bhd (KL:ASDION) has been classified as a Guidance Note 3 (GN3) company.

This comes after its external auditors, CAS Malaysia PLT, flagged material uncertainty that would affect the company’s ability to continue as a going concern.

According to the auditors’ report, Asdion's current liabilities exceeded its current assets by RM5.56 million and RM6.38 million at the group and company level respectively as at end-March 2024.

During the same period, Asdion also incurred net losses of RM7.79 million and RM40.79 million at the group and company level respectively.

It added that Asdion’s ability to operate as a going concern is “highly dependent on the formalisation and successful implementation of the turnaround” and the company’s fundraising plan to restore its financial position and achieve sustainable and viable operations.

Asdion said it is in the process of formulating a regularisation plan to address its financial condition and will make the necessary announcements regarding the matter.

As a GN3 company, Asdion is required to submit a regularisation plan to Bursa Malaysia and obtain approval to implement the plan within 12 months from Thursday (Aug 1). Failure to comply with these obligations may result in the stock facing suspension and delisting from the ACE Market.

Asdion's stock has lost 61.9% year to date to close half a sen lower at four sen on Thursday for a market value of RM20.43 million.