KUALA LUMPUR (June 30): Ecobuilt Holdings Bhd (KL:ECOHLDS) said its external auditor has highlighted a material uncertainty on the group's ability to continue as a going concern, mainly due to unresolved issues concerning trade payables.
In a Bursa Malaysia filing on Tuesday, the construction group said the auditor, PKF PLT, raised the matter in its qualified audit opinion on Ecobuilt's financial statements for the financial period ended Feb 28, 2026 (FY2026).
The auditor in its report noted that it was unable to obtain sufficient appropriate audit evidence over long-outstanding trade payable balances amounting to RM3.46 million as at Feb 28, after failing to secure external confirmations from creditors and being unable to perform satisfactory alternative audit procedures.
PKF PLT also identified discrepancies between certain trade payable balances recorded by the group and creditors' statements. Its verification indicated possible understatement of RM7.26 million and possible overstatement of RM5.52 million in trade payables as at Feb 28, while similar unreconciled discrepancies were also found for the previous financial year.
As a result, the auditor said it could not determine whether adjustments were necessary to Ecobuilt's financial statements.
PKF PLT also noted Ecobuilt posted a net loss of RM7.62 million for FY2026, while its current liabilities exceeded current assets by RM2.08 million, conditions that indicate a material uncertainty exists over the group's ability to continue operating as a going concern.
In response, Ecobuilt said it has undertaken, and will continue to undertake, measures to strengthen its internal controls, accounting processes and monitoring procedures.
The group said it is also enhancing its reconciliation procedures, supporting documentation and financial reporting processes, including periodic reviews of significant accounting estimates and judgements, to address the matters that gave rise to the qualified opinion.
Ecobuilt aims to resolve the issues underlying the qualified audit opinion within 12 months from the date of the announcement.
In a separate filing on Tuesday, Ecobuilt said it had released its annual report for FY2026 to Bursa within the prescribed time frame, averting the risk of a trading suspension.
The company had earlier warned that it might miss Bursa's deadline to issue the annual report and that additional time may be needed to finalise its audited financial statements.
Shares in Ecobuilt closed unchanged at 3.5 sen on Tuesday, valuing the group at RM14.73 million.