Adjusted Ayo finacial statements being audited, PIC inquiry hears

Accounting adjustments were made to reflect higher profits in AYO Technology Solutions’ interim financial statements, the Public Investment Corporation commission of inquiry heard.

Ayo former chief investment officer (CIO) Abdul Malick Salie provided his testimony to the commission which is investigating allegations of wrongdoing at the PIC, which manages R2.2-trillion in investments on behalf of public servants.

Salie was subpoenaed to take the stand after he resigned from his position as CIO last week due to pressures he was facing following reports on governance issues at Ayo. The ICT company is a subsidiary of African Equity Empowerment Investments (AEEI).

The PIC invested R4.3-billion in Ayo when it listed on the JSE in late 2017. There are allegations that the value of Ayo was misstated at the time of its listing. Salie responded to these allegations in his testimony.

The inquiry, chaired by Justice Lex Mpati has also previously heard from Ayo’s former chief executive officer (CEO) Kevin Hardy that the group’s interim financials were tampered with. Ayo has denied wrongdoing, but the JSE has ordered an audit of the financial statements.


Salie said that at the time the interim financial results were released in February 2018, he was not an employee of Ayo, nor was he a member of the board. He was the AEEI chief financial officer (CFO), with limited responsibility to only focus on mergers and acquisitions and assisting investment activities of the group’s companies. “I was not responsible for financial reporting at group level,” he told the commission.

In April 2018 he was contacted by CEO of AEEI Khalid Abdulla to discuss the February 2018 Ayo interim results. According to Salie he met Abdulla at his home in May 2018 and then based on the spreadsheet of interim results, Salie saw that it reflected a profit of R50-million.

According to Salie, he and CFO Naahied Gamieldien were asked by Abdulla to review the operating costs of AYO as the operating profit was far too low and should have been in excess of R40-million. “He wanted us to identify operating costs that could be capitalised as well as to review the share based payment charge,” Salie told the commission.

The operating profit was R29-milion, compared to R28-million reported in 2017.  —Fin24

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Lameez Omarjee
Lameez Omarjee
Parliamentary reporter at Fin24.com

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