Aug 2010 Financial News

Group: Probe Angostura loss

Aug 11, 2010

THE Trinidad and Tobago Transparency Institute (TTTI) is calling on the relevant authorities to investigate the losses disclosed in Angostura's 2008 financial statements, and why it was necessary for the State to bail out the CL Financial Group.

Angostura recently released its 2008 audited financial reports that showed profits for the first quarter of 2010 but a $1.3 billion loss in 2008 that resulted from problems with its parent company CL Financial and related subsidiaries.

The report stated: "The consolidated financial statements for the year ended December 31, 2008 have been regrettably, materially impacted by post year end events involving CL Financial Limited (CL Financial), which reflected a precarious financial position of our parent company and other CL Financial subsidiaries and which in turn, impaired the collectability of circa $1,185 million in receivables from the CL Financial Group."

The report also said the company's board could not declare dividends for 2008 because there was a net loss for the year of almost $1.3 billion as well as accumulated losses of $307 million and negative net shareholders' equity of $121 million.

TTTI yesterday said the company's audited report raised questions about the practice of corporate governance at Angostura and an investigation and findings should be made public.

The results of decisions made by Angostura and the CL Financial Group had a negative impact on their immediate stakeholders, on the public finances of Trinidad and Tobago, and the wider Caribbean, TTTI said.

"When decisions taken by a private entity have a heavy impact on the public purse, the processes surrounding those decisions should not remain private. We need to establish the lessons that can be learnt from that unfortunate situation, and take the necessary steps to ensure they are not repeated in the future," the TTTI said.


Source:
Camille Bethel
camille.bethel@trinidadexpress.com
Trinidad Express
Wednesday August 11, 2010

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