Australia-listed operator of Asian casinos Silver Heritage Group Ltd says the firm’s financial statements cannot be prepared on a going concern basis – as required under Australian Accounting Standards – as it is currently negotiating the sale of its Nepal operations.
“Financial statements are normally prepared on a going concern basis where (or when) there is neither the intention nor the need to materially curtail the scale of the entity’s operation,” the casino operator told the Australian Securities Exchange on Tuesday.
Silver Heritage said on July 31 that it had received a US$33.9-million offer to buy its Nepal operations. Silver Heritage owns and operates the casino property Tiger Palace Resort Bhairahawa (pictured) on Nepal’s border with India. The group also manages gaming at the Millionaire’s Club and Casino, in Kathmandu, the capital of Nepal.
“As the company’s Nepal operations represent the company’s only remaining operating segments, a sale, if approved eventually by the shareholders of the company, would represent a material curtailment of the entity’s operations,” said Silver Heritage in Tuesday’s filing.
The company said additionally that its directors “determined that the going concern basis of accounting (as applied in previous years) would no longer be appropriate”.
“The financial statements will not be prepared on a going concern basis, rather the interim financial statements will be prepared on a realisation basis of accounting, reflecting an orderly disposal of the company’s Nepal operations,” it stated.
The company said the publishing of its interim financial statements would be delayed because of the change in the basis of preparation “until the directors, in conjunction with the company’s auditors, have sufficiently considered the impact of this change in basis of preparation on the interim financial statements”.
Silver Heritage said also that it continued to pursue options for additional funding “in order to execute its long-term strategy”.
“Should the sale of the company’s operations in Nepal not proceed and the company obtains additional capital, the financial statements of the company would return to being prepared on a going concern basis,” it added.
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