JSE-listed Allied Electronics (Altron) on Friday announced the pre-cautionary suspension of three Altron Nexus senior executives.
This follows an investigation at the subsidiary that revealed potential internal irregularities.
After receiving information from whistle-blowers – one in June last year and again in June 2019 – Altron appointed independent investigators to look into alleged procurement irregularities among a few senior executives within Altron Nexus.
The first investigation undertaken last year found no evidence of irregularities, but made recommendations on procurement process improvements and reporting obligations, which were implemented.
The preliminary findings from the more recent second investigation, undertaken by forensic services company Naledi Advisory Services, revealed potential deviation from procurement processes involving an estimated R23-million and early profit recognition of about R20-million in the 2018 financial year.
“The company views these allegations in a serious light. Accordingly, this investigation is in line with the Altron group’s zero-tolerance to unethical conduct, despite the amounts not being material to Altron’s financial position,” Altron said in a voluntary statement to shareholders.
Altron is following due process and the three executives may go through a disciplinary hearing, overseen by an independent chairperson.
“While the investigation is ongoing, the company would like to assure its customers, partners and employees that plans have been put in place to ensure business continuity at Altron Nexus,” it concluded.