Accentuate outlook inspires shareholders

NEWS that headline earnings at Accentuate, the construction, flooring and chemicals company, are expected to be between 6.2c and 6.4c a share for the 12 months ended-June 2016 was well-received by investors. On Monday, the share price, which has been increasing steadily for most of the year, reached a record high of R1.

Shareholders have obviously decided to forget all about Accentuate’s recent history and buy into management’s positive outlook. They will be helped in this approach by the accounting treatment of the massive fraud perpetrated on the company over the 10 years to the end of financial 2015, which has been relegated to deep history. During that 10 years, the financial director of Accentuate’s most profitable division, Floorworx, allegedly defrauded the company of R70m. A criminal case has been opened.

Amazingly, the fraud was not revealed as a result of any discrepancies in the company’s accounts or by its auditors, but because someone noticed the director’s lifestyle seemed extravagant.

The financial results are due out later this week and will incorporate the 2015 accounts, restated to account for the fraud. As management says, this restatement will make the 2016 figures meaningless for comparison purposes.

T❑❑❑

HE Financial Centre Amendment bill gathering dust on President Jacob Zuma’s desk has to hold the record as SA’s most misunderstood piece of legislation.

Or, perhaps, it is well-understood, and that is why it has faced as much resistance as it has. The bill, which aims to bring SA’s antimoneylaundering and terroristfinancing laws in line with international standards, also provides for closer scrutiny of politically exposed persons’ bank accounts. This includes everyone from the president to a municipal manager.

Former government spokesman Mzwanele Manyi and his Progressive Professionals Forum have lodged objections against the bill, which Zuma’s office says has delayed its signing into law.

Former Government Employees Pension Fund spokesman Khaya Buthelezi has publicly said the bill targets “socalled politically exposed blacks”, and that it made a career in the public sector unattractive.

But that would be an inappropriate characterisation of the bill, which includes people in influential roles in the private sector.

The Treasury, in a briefing to the select committee on finance earlier in 2016, said “public-sector persons will also have private-sector counterparts”.

In other words, any public official receiving kickbacks will probably be getting them from someone in the private sector.

This legislation will see the net close on corruption, and fast. Neels Blom edits Company Comment (blomn@bdlive.co.za)

■