PSE suspends PAL Holdings shares trading on alleged audit rule violation

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Metro Manila (CNN Philippines, June 18) — Trading in shares of PAL Holdings has been suspended effective Friday, the Philippine Stock Exchange announced on the same day.

In a notice, the bourse noted how the flag carrier operator’s independent auditor did not provide an opinion on the company’s financial statements. In its disclaimer of opinion, SyCip Gorres Velayo & Co. wrote that it has “not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion” for these.

The listed company published its annual report on Thursday, revealing a staggering ₱73-billion loss in 2020 amid pandemic-induced travel restrictions and weakened demand for flights. 

The PSE cited Rule 68, as amended, under the Securities Regulation Code, which says audited financial statements (AFS) of covered companies “with an auditor’s opinion other than unqualified because of deviation(s) from the required financial reporting framework or due to a scope limitation imposed by the company, shall be considered a violation of this Rule.”

After review, the local stock exchange found that PAL Holdings’ 2020 annual report does not comply with the said rule, it added.

Prior to the suspension, the local bourse imposed a trading halt on the company’s shares just this Thursday.

CNN Philippines has reached out to PAL Holdings for comment.