SINGAPORE: Singapore Post will not be publishing the findings of an internal investigation into whistleblowing reports, the company said in a Singapore Exchange (SGX) filing late Sunday night (Dec 29).
It announced on Dec 22 the termination of the employment of its group chief executive officer Vincent Phang, group chief financial officer Vincent Yik and chief executive of the company’s international business unit Li Yu over the mishandling of the whistleblowing reports.
Three other managers who were directly involved in the matter were also sacked after an internal investigation and a police report was made against them.
In response to a question from the Securities Investors Association (SIAS) as to whether it will publish the key findings of the internal investigation report, SingPost pointed to the announcements it made on SGX on Dec 22 and late Sunday night.
"Both announcements disclose that the eventual settlement with the affected customer has no material financial impact on the group.
"The company will make further announcements as and when there are material developments," it added.
A whistleblower report was filed earlier this year about the group's non-regulated international e-commerce logistics parcel business.
The report alleged that there were manual entries of certain delivery status codes by SingPost's international business unit. These were for international transhipment parcels which the company had agreed to deliver under an agreement with one of its largest customers.
These manual entries were allegedly done without basis or supporting documentation and with the intention of avoiding contractual penalties under the agreement.
Following an investigation, disciplinary proceedings were brought against three managers who were directly involved in the matter. It was found they had committed serious breaches of the company's code of conduct, SingPost said.
The managers were found to have performed or approved manual "delivery failure" status codes for parcels, even though no delivery attempt had been made and without supporting documents.
They have been sacked and a police report made against them.
Mr Phang, Mr Yik and Mr Li were found to be "grossly negligent" in their handling of the internal investigations into the whistleblowing report.
They had "accorded undue weight" to the misrepresentations by representatives from the international business unit operations.
In its filing on Sunday night, SingPost told SIAS the contract with the customer was renewed in August 2024 and the "salient terms" of the renewed contract were renegotiated taking into account "acceptable key performance indicators".
"The terms of the previous and current contracts with the customer are confidential. The terms of the settlement with the customer are also confidential," it said.
SingPost added that the settlement did not have a material impact on the company's net profit, net tangible assets or earnings per share for the last financial year.
It is also not expected to have a material impact on the company's projected net profit, net tangible assets or earnings per share for the current financial year.
The retail investor watchdog asked if the company would be carrying out a "group-wide review" to make sure all business units are following the firm's rules and protocols.
SingPost said its investigations into the whistleblowing matter had determined that the issue was "isolated and limited" only to the contract with the customer and the practices of the three former managers from the international business unit operations.
Their practice of manual data entries ceased after instructions were given by the audit committee to management.
It added that corrective action was also taken to prevent similar occurrences and "address all relevant operational gaps".
As part of the group's next internal audit plan, the audit committee and the independent group internal audit will continue to review the effectiveness of the corrective actions.
"The board is of the view that the group’s internal controls and risk management systems are adequate to address the risks which the group considers relevant and material to its operations and finances," said SingPost.
"However, no system of internal controls, no matter how robust, can provide absolute assurance against deliberate misconduct or fraud."
From left: Former SingPost senior executives Vincent Phang, Vincent Yik and Li Yu.
Responding to questions regarding the sale of its Australian business, Freight Management Holdings (FMH), SingPost said that the sale is not expected to be affected by the sacking of the three senior executives.
"The sale process is progressing and the board will seek shareholders' approval for the proposed divestment at an extraordinary general meeting expected to be held in February 2025," it said.
"The Board is working closely with the management team to ensure the successful completion of the proposed divestment."
SingPost announced early December that it would sell FMH to private equity firm Pacific Equity Partners for a cash consideration of A$775.9 million (US$504.1 million).
The sale is expected to generate a gain on disposal of S$312.1 million, it said then.
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It announced on Dec 22 the termination of the employment of its group chief executive officer Vincent Phang, group chief financial officer Vincent Yik and chief executive of the company’s international business unit Li Yu over the mishandling of the whistleblowing reports.
Three other managers who were directly involved in the matter were also sacked after an internal investigation and a police report was made against them.
In response to a question from the Securities Investors Association (SIAS) as to whether it will publish the key findings of the internal investigation report, SingPost pointed to the announcements it made on SGX on Dec 22 and late Sunday night.
"Both announcements disclose that the eventual settlement with the affected customer has no material financial impact on the group.
"The company will make further announcements as and when there are material developments," it added.
WHAT HAPPENED
A whistleblower report was filed earlier this year about the group's non-regulated international e-commerce logistics parcel business.
The report alleged that there were manual entries of certain delivery status codes by SingPost's international business unit. These were for international transhipment parcels which the company had agreed to deliver under an agreement with one of its largest customers.
These manual entries were allegedly done without basis or supporting documentation and with the intention of avoiding contractual penalties under the agreement.
Following an investigation, disciplinary proceedings were brought against three managers who were directly involved in the matter. It was found they had committed serious breaches of the company's code of conduct, SingPost said.
The managers were found to have performed or approved manual "delivery failure" status codes for parcels, even though no delivery attempt had been made and without supporting documents.
They have been sacked and a police report made against them.
Mr Phang, Mr Yik and Mr Li were found to be "grossly negligent" in their handling of the internal investigations into the whistleblowing report.
They had "accorded undue weight" to the misrepresentations by representatives from the international business unit operations.
Related:
In its filing on Sunday night, SingPost told SIAS the contract with the customer was renewed in August 2024 and the "salient terms" of the renewed contract were renegotiated taking into account "acceptable key performance indicators".
"The terms of the previous and current contracts with the customer are confidential. The terms of the settlement with the customer are also confidential," it said.
SingPost added that the settlement did not have a material impact on the company's net profit, net tangible assets or earnings per share for the last financial year.
It is also not expected to have a material impact on the company's projected net profit, net tangible assets or earnings per share for the current financial year.
ISSUE ISOLATED
The retail investor watchdog asked if the company would be carrying out a "group-wide review" to make sure all business units are following the firm's rules and protocols.
SingPost said its investigations into the whistleblowing matter had determined that the issue was "isolated and limited" only to the contract with the customer and the practices of the three former managers from the international business unit operations.
Their practice of manual data entries ceased after instructions were given by the audit committee to management.
It added that corrective action was also taken to prevent similar occurrences and "address all relevant operational gaps".
As part of the group's next internal audit plan, the audit committee and the independent group internal audit will continue to review the effectiveness of the corrective actions.
"The board is of the view that the group’s internal controls and risk management systems are adequate to address the risks which the group considers relevant and material to its operations and finances," said SingPost.
"However, no system of internal controls, no matter how robust, can provide absolute assurance against deliberate misconduct or fraud."
From left: Former SingPost senior executives Vincent Phang, Vincent Yik and Li Yu.
SALE OF AUSTRALIAN UNIT
Responding to questions regarding the sale of its Australian business, Freight Management Holdings (FMH), SingPost said that the sale is not expected to be affected by the sacking of the three senior executives.
"The sale process is progressing and the board will seek shareholders' approval for the proposed divestment at an extraordinary general meeting expected to be held in February 2025," it said.
"The Board is working closely with the management team to ensure the successful completion of the proposed divestment."
SingPost announced early December that it would sell FMH to private equity firm Pacific Equity Partners for a cash consideration of A$775.9 million (US$504.1 million).
The sale is expected to generate a gain on disposal of S$312.1 million, it said then.
Related:
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