Wednesday, July 19, 2017
The Disgrace that is DIMO – using concepts out of context to bamboozle!
Oh Please Where are our journalists? Where are our investigative journalists who should pick up these common sense wrongs of society and inform the public? They are too busy enjoying the scraps thrown by the likes of these companies to report cautiously, inquisitively, voraciously, and questioning the veracity of the statements made in full public view!
DIMO or Diesel and Motor Engineering PLC, won the award for the Nth consecutive year as having the BEST Integrated Accounting Report in Sri Lanka of the Companies that entered the competition at the award ceremony held at the opening ceremony of the CMA Annual Conference at the Cinnamon Lakeside on Monday, July 17th 2017 beating out numerous other Companies.
What is Integrated Accounting? – It is defined as “a Report which is a CONCISE Communication about how an organization’s strategy, governance, performance and prospects lead to the creation of value over the short, medium and long term!”
Frankly, it is anything but. Shame shame shame. Shame for the CMA in giving them this award, shame for DIMO in even believing they achieve the above objective from their 185page small type report, which is anything but concise and nothing if misleading with verbocity of disinformation simply aimed at fooling the reader and observer in broad daylight.
In some senses one can fool people by not giving any information, in this case it is fooling with too much information aimed at making the reader believe in both transparency and objectivity, but if read in context by a careful, knowledgeable and half way intelligent person, it is clear the LAST thing that DIMO even attempts to do is to create value for their main stakeholders who are its shareholders, and in the sense of a Quoted Company whose aim SHOULD be to over time to encourage WIDE SPREAD share-ownership, it is doing anything but.
Read the report if you wish as it is available on-line to disprove my hypothesis, on link https://cdn.cse.lk/cmt/upload_report_file/694_1496746469.pdf
Lets go straight to page 136 which shows that the Directors’ Emoluments have risen from Rs300M to Rs500M year on year, the latest being for the year ended 31st March 2017. This is about the same as the POST TAX PROFITS – shameful. Hardly one that will encourage a person to buy DIMO shares, if the Directors simply help themselves to the LOOT. Any reasonable person will say it is simply untenable that a public company is allowed to this, even OPENLY!
Then go to page 168 where you see that the top 20 shareholders own 83% of the company, hardly one that is encouraging widespread ownership. Further you would note that EPF as No1 own about 20% of the Company. Who is the EPF? Well, they are the Trustees of the Private Sector Workers Pension Plan, in short the money of the MOST productive part of our society. Sadly this is managed by the CBSL, Central Bank of Sri Lanka, and typical of Governmental Bodies DOES NOTHING TO PROTECT THE PEOPLE THEY PROMISE TO SERVE. We have just heard about their dishonesty haven’t we?
At least the EPF have a DUTY to question if the Company they have a 1/5th interest in is paying its directors such a MAMMOTH remuneration when page 168 shows that they ARE ALSO the large shareholders, who enjoy Dividend INCOME in addition to directors fees! Where is the Independent Director here? A prominent accountant on the Board, he should question this first and foremost, or is the trust placed in him MISPLACED, as he has waived on this payment without question, because he too is paid handsomely? Is this just a BRIBE to keep quiet? So where is the ICASL on this? All rogues too leading it.
What am I coming down to explain? It is simply jobs for the boys and what are they doing? They are sharing the loot amongst themselves, while the Stock Market Tanks, with NO one wishing to risk their money in the SL Stock Market when such practices are rampant, akin to STEALING IN BROAD DAYLIGHT, or daylight robbery of the people’s money, yes the money of the millions of hardworking people of Sri Lanka via their pension plan invested in this company. Yes none is doing anything about it. Where is the independent press?
I have not picked on DIMO for any particular reason, it was just when I saw they had won the award for the Best Integrated Report and I then went to look at this so called BEST report and look what I found! It is what I have just reported to you my reader. So much for the johnnies who are bribed to award losers!
If this is by chance with NO malice, how many ROGUES have we got at the top of the Corporate Ladder? John Keells who came second will come within my periscope next. We know how well the Board pay themselves in Share Options to the extent that if you see from the start of the Directors Appointment to today, how many shares they got, how many sold, how much they benefitted this Rs500M pales in comparison to the Rs5Billion ripped off by the TOP man there, without a MOO from the shareholders who are held hostage!
Come on guys, who will invest in a market so corrupt and inequitable that they do NOTHING to enhance the value of the most important shareholder namely the small shareholder, whose faith in Stocks is the only way to encourage widespread share-ownership. CSE no doubt is still fast asleep day dreaming!