Karachi: Pakistan Engineering Company Limited (PECO) is facing increased scrutiny after its statutory auditor issued a Disclaimer of Opinion on the audit report for the fiscal year ending June 30, 2023. This development has triggered actions under the Pakistan Stock Exchange (PSX) regulations, specifically Clause 5.11.1.(g), which addresses situations where a company’s auditor issues a disclaimer or adverse opinion.

The Clause 5.11.1.(g) of the PSX Regulations states that a listed company may be placed in the Non-Compliant Segment if its statutory auditor issues such an opinion. This classification means that the company will be subject to specific actions outlined under regulations 5.11.3(a) and 5.11.3(b).

The situation for PECO is compounded as the company is already placed in the Non-Compliant Segment due to its failure to hold an Annual General Meeting and not transmitting the annual audited financial statements for the year ending June 30, 2024. These additional compliance failures will be formally noted in the Daily Quotations of the Exchange starting from February 17, 2025.

According to information available from the Pakistan Stock Exchange (PSX), this step further solidifies PECO’s standing in the Non-Compliant Segment, adversely affecting its credibility among investors and stakeholders. The continuous non-compliance raises concerns about the governance and financial transparency of PECO.

The market category affected by this development includes stakeholders who hold shares in the engineering sector, where PECO is a significant player. The company’s current predicament could influence investor confidence and the overall market perception of the engineering sector on the PSX.