Hascol excluded from list of eligible securities on PSX

KARACHI: The National Clearing Company of Pakistan Limited (NCCPL) has excluded M/s Hascol Petroleum from the list of eligible securities after the Pakistan Stock Exchange (PSX) placed the oil company into the defaulter’s segment.

 In a notice sent to the PSX, the NCCPL said it has placed M/s Hascol Petroleum Limited (HASCOL) in the defaulter’s segment with effective from June 28, 2021, leading to action under Clauses 7A.3.5 and 7B.3.1.4 of NCCPL Regulations, 2015.

“Accordingly, in pursuance of provisions stipulated in the above referred clauses of NCCPL Regulations, 2015, M/s Hascol Petroleum Limited shall be excluded from the list of SLB Eligible Securities, MF Eligible Securities and MTS eligible Securities with effect from Monday, June 28, 2021,” it added.

Earlier the Internal auditors of Hascol Petroleum Limited (HPL) submitted evidences to its Board of Directors (BoDs) regarding the ‘False Purchase Orders‘ and misappropriation in company during 2019.

Chairman HPL Alan Duncan in a letter to Securities and Exchange Commission of Pakistan (SECP) and Pakistan Stock Exchange (PSX) said, “the company’s Internal Auditor received a whistleblower statement and evidence from within the Company that in 2019 a series of false purchase Orders were created and entered into the company’s books.”

“The Internal auditor, as required by the procedure, referred the matter to the Board Audit Committee which, at its meeting last week, concluded that there is sufficient evidence in support of the accusation to justify referring the matter to the full Board of Directors.”

He said since its information in September 2020, the newly constituted Board of Hascol Petroleum has been taking serious steps to improve the governance and management of the Company.

“One such action has been to establish a whistleblowing/speak out policy under which employees are encouraged, without any fear of reprisal, to report any incident or conduct in the company which they believe fell short of proper standards,” he added.

The letter further said that the Board of Directors has yet to receive a comprehensive report on what is alleged to have taken place. “In the meantime, I consider it proper, through this statement, to immediately replay this information to the SECP and PSX,” he added.

He claimed that if the statement, if proven correct, may require the Company to restate its past Income Statements and past and current balance Sheets, it is not expected to make any material difference to the Company’s recent and future operations, he claimed.

The chairman also informed the SECP and PSX that the Company’s Board of Directors has decided to accept the resignation of Grant Thornton as its auditors for the year 2020 which immediate effect.

Hascol Petroleum Limited expects the outgoing auditors to fulfill all their legal and professional requirements for the years they were the company’s auditors. Hascol has been in financial trouble since 2018 with declining revenues and mounting losses that have sent the share price down from over Rs300 three years ago to just Rs11.23 on June 19. However, revisions in financial accounts are not expected to make any material difference to the company’s recent and future operations.