JSE slaps EOH with R7.5mn fine

South African technology group EOH has been slapped with a hefty R7.5 million fine by the Johannesburg Stock Exchange (JSE) for releasing financial results with errors. The JSE found that EOH's results statements for 2017 and 2018 had understated losses, prompting the regulatory body to take action against the company. In a recent interview with CNBC Africa, Megan Pydigadu, Group CFO of EOH, addressed the implications of the fine and shed light on the ongoing efforts to rectify the situation. Pydigadu highlighted that the transgressions leading to the fine were a result of actions by the previous management. She emphasized that the current leadership at EOH has been diligently working to clean up the company's financial practices while also safeguarding thousands of jobs amidst turbulent times. Despite the financial penalty, Pydigadu pointed out that shareholders had already borne the brunt of significant losses under the previous management, making the fine a part of a broader effort to restore transparency and integrity in the company's operations. Discussing the collaboration with auditors, Pydigadu mentioned a difference in opinion that arose during the audit process, particularly regarding the treatment of prior adjustments. While the auditors agreed with EOH on the closing balance sheets, there were discrepancies in other areas, leading to a qualified opinion from the auditors. Pydigadu reiterated the importance of upholding principles and ensuring that stakeholders receive accurate and reliable information for making informed decisions. The conversation delved into investigations involving Mazars, the auditing firm associated with EOH. Pydigadu clarified that EOH was not directly handling these investigations, as they had been passed on to relevant authorities. Regarding the ongoing scrutiny of the previous management's role in the accounting irregularities, legal actions have been taken by EOH, and the focus now lies on regulatory bodies such as ERBA to assess the audit processes. In a separate development, Pydigadu addressed the recent resignation of the chair of EOH's social and ethics committee. She clarified that the resignation was unrelated to the ongoing investigations and attributed it to personal reasons. Despite the challenges and fines faced by EOH, the company appears committed to a path of accountability and rectification under the new leadership. With a focus on transparency and cooperation with regulatory bodies, EOH aims to rebuild trust and credibility within the market.