Industrial Asphalts (Ceylon) PLC has been transferred to the Colombo Stock Exchange’s Watch List with effect from 20 October, after its external auditor issued a Disclaimer of Opinion on the accounts for the year ended 31 March 2026.
The auditor is B R De Silva & Co, and the transfer was made under Section 7.5(d)(i)(A)(5) of the CSE Listing Rules, EconomyNext reported, reproducing the company’s corporate disclosure in full. The company’s board is disputing the auditor’s findings and has set out a six-month window to resolve them before the shares risk a trading suspension.
What a disclaimer means
A Disclaimer of Opinion is the most severe outcome of a statutory audit. It is not an adverse opinion — the auditor is not saying the accounts are wrong. It is a statement that the auditor could not obtain sufficient appropriate evidence to form any opinion at all, and so declines to give one. For a listed company it removes the assurance the market relies on, which is why the exchange’s rules attach a Watch List transfer to it.
The two grounds
The disclaimer rests on two bases, according to the company’s own disclosure:
- The fair valuation of investment property. The company records a disagreement with the valuation carried out by KPMG Real Estate & Valuation Services (Pvt) Ltd.
- An advance given to Key Management Personnel during the year.
The second is the governance question. An advance to key management personnel is a related-party transaction, and an auditor unable to satisfy itself about one is unable to satisfy itself about a payment from the company to its own officers.
What happens next
The six-month window is the company’s own framing of the time available to it. Under the listing rules a security that remains on the Watch List without the underlying matter being resolved faces suspension from trading.
Not reported
The filing does not quantify either item: no value is given for the investment property, for the difference between the company’s figure and the valuer’s, or for the advance to key management personnel. It does not name the personnel concerned, say when the advance was made, or report whether it has been repaid.
Nor does it state the company’s revenue, profit or net asset position for the year, give the share price reaction to the transfer, or record any comment from the auditor, from KPMG or from the CSE. No date is given for the end of the six-month window.
This account rests on a single verified source, though that source reproduces the company’s own disclosure to the exchange, which is the primary document. The report was published on 21 October, within the freshness window for this article.
