A large shipping company that is intimately involed with the oil and gas industry recently posted siginificantly lower earnings, the main reason given was that they made higher imparment charges in the fourth quarter.
Now what was missing was whether the impairment was only made in the 4th qtr or whether there were impairment charges made in the 1st, 2nd and 3rd qtrs too. I am told by an ex audit partner friend that impairment needs to be accounted for immediately and its not a year end charge!
If this be the case, than perhaps,
1. That the Corporate Survillance department of the SC needs to review the accounts and provide assurances that the previous quarterly announcements were not false or misleading(possible painting a rosier picture than it is).
2. I was puzzled by the decision of the Board to declare a dividend. This surprised me because a good part of the announcement related to the bleak situation in the o&g shipping industry citing oversupply etc etc and the challenges relating to o&g.
Sometimes, no, most times I wonder whether good corporate governace is a myth and whether its just spoken of to say "WE ALSO HAVE IT"
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