Khan Brothers PP Woven Bag Industries has been facing a working capital shortage, says its auditor.
The auditor said in its opinion that the manufacturer and exporter of woven bags, sacks, and woven fabrics is now working on subcontracts after cancellations of its export orders.
Now it has been recommended to chalk out a proper management plan for the company.
The auditor also found its non-compliance with the value-added tax (VAT) rules although the company showed Tk9.10 crore revenue from local sales and subcontracts in fiscal 2021-22. The company showed zero value in its VAT returns.
It showed an inventory of raw materials worth Tk55.33 crore, which has been carried forward for the last couple of years due to the cancellation of its export orders for global business disruptions amid the pandemic.
The company has had a fixed deposit of Tk3 crore in the scam-hit Peoples Leasing and Financials Services for a long time and it did not maintain any provision against the amount.
Khan Brothers PP Woven Bag Industries got listed on the stock market in 2014 by raising Tk20 crore to purchase machinery, construct buildings, and repay bank loans.
Despite incurring losses in FY22, the company decided to pay a 2% cash dividend to its shareholders.
In FY22, its loss per share stood at Tk0.18.
Earlier, based on the half-yearly earnings, the company paid a 2% cash dividend only to its general shareholders.