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BL Premium reports that a former long-term investor in Tongaat said on Sunday that the sugar producer’s previous management should return multimillion-rand cash bonuses paid on the basis of allegedly inflated profits.
Tongaat announced on Friday that it needed to restate its financial statements for the year to March 2018 after identifying "past practices, which are of significant concern". The company said it would probably have to reduce the equity on its 2018 balance sheet by between R3.5bn and R4.5bn, about a third. "These past practices appear to have resulted in financial statements that did not reflect Tongaat Hulett’s underlying business performance accurately," it said in a carefully worded statement that fell short of accusing the previous management of fraudulently manipulating its finances. A review is ongoing and incorporates an independent forensic investigation to establish any evidence of whether any past practices were deliberate. The announcement came days after the resignation of Jenitha John, the board’s audit and compliance committee chair. John resigned due to work commitments and the fact that "current challenges" had increased demands on her time. Chris Logan of Opportune Investment said the company’s former CEO Peter Staude and former CFO Murray Munro, who left in 2018, should repay past bonuses if the payments were based on inflated profits. Between 2008 and 2018, Staude was paid a total remuneration of R176.4m, including a R38.9m cash bonus. Over that period, Staude’s long-term incentives amounted to R55.8m. Munro was paid a total remuneration of R97.6m.
- Read the full original of Siseko Njobeni’s report on this story at BusinessLive (paywall access only)
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