KUALA LUMPUR (Oct 20): Handal Energy Bhd’s (KL:HANDAL) external auditor resigned on Monday after the company indicated its intention to appoint a replacement, with the board expressing dissatisfaction over the progress of an audit that has delayed its annual report for nearly six months.

The oil and gas services provider, whose businesses include offshore cranes and lifting, said SBY Partners PLT submitted its resignation as statutory auditor on Monday. The board accepted the resignation the same day, according to its filing with Bursa Malaysia.

“SBY’s resignation follows the company’s letter to SBY dated Oct 18, 2026, in which the company indicated its intention to appoint a new firm of auditors in place of SBY. The board is not satisfied with the progress of the audit,” the filing read.

Apart from those disclosures, the board said it was unaware of any other matter relating to the resignation that needed to be brought to shareholders’ attention. The company also changed its financial year end from Dec 31, 2025 to Nov 30, 2026. The revised financial period will span 29 months, from July 1, 2024 to Nov 30, 2026.

The change was intended “to improve operational efficiency, including cash flow management”, and give auditors sufficient time to complete the audit outside the peak periods associated with the June 30 and Dec 31 year ends, according to the filing.

Both announcements come four days after Handal Energy set another target to issue its overdue 2025 annual report by Oct 28. Trading in its shares has been suspended since May 11 after it missed the original April 30 submission deadline.

Handal Energy's annual report was originally due within four months of the end of its financial period on Dec 31, 2025. The company initially said it needed additional time to finalise its audited financial statements and targeted submission by May 8. It has since revised that target repeatedly.

On Aug 6, Handal Energy pushed its expected annual report submission to the end of October, prompting Bursa to seek details of the audit’s progress, outstanding matters and a specific issuance date. In its Aug 11 response, Handal described the audit as being at an advanced stage and targeted publication by Oct 15.

That target was subsequently moved to Oct 28.

Handal Energy had identified the audit of Tenzin Heavy Machinery (M) Sdn Bhd as a principal reason for the delay. Although Handal Energy holds a 30% equity interest in Tenzin, it consolidates the company as a subsidiary on the basis of control.

Tenzin is audited by a separate firm namely Messrs Khoo Wong & Chan and its signed financial statements were provided to Handal Energy’s group auditor on July 30.

Outstanding work disclosed in August announcement included checks on Tenzin’s inventories, receivables and cash flow projections, as well as the group’s cash flow forecasts, litigation-related contingent liabilities, asset impairment assessments and certain accounting treatments.

In its latest update on Oct 15, Handal Energy said information relating to 11 matters raised by the auditors had been supplied through documents, legal confirmations and discussions held over several months. These included management accounts for individual group companies up to Sept 30, submitted on Oct 7, and updated cash flow projections supplied on Oct 8.

However, further requests followed, including updated legal information and documentation relating to events after the reporting period. The additional requests covered bank statements, salary listings and statutory contribution records, as well as a subsidiary’s debtor ageing report.