Koda Ltd Announces Proposed Change of Auditor: What Investors Need to Know

Key Points of the Announcement

• Koda Ltd intends to change its auditor from Deloitte & Touche LLP to Forvis Mazars LLP for the financial year ending 30 June 2026 (FY2026) and onward.
• The change is subject to shareholder approval at an upcoming Extraordinary General Meeting (EGM).
• Deloitte has served as auditor since July 2000, with its last re-appointment at the October 2025 AGM.
• The Board, in consultation with the Audit Committee, believes the change will improve corporate governance and reduce business costs.
• Estimated reduction in audit fees of approximately 27.9% for FY2026, with no change in the scope of audit.
• Forvis Mazars is registered with ACRA and approved under the Accountants Act. The proposed engagement partner, Mr. Ooi Chee Keong, successfully completed ACRA’s Practice Monitoring Programme in 2023.
• All subsidiaries in Singapore will be audited by Forvis Mazars; Malaysian and Vietnamese subsidiaries will be audited by overseas member firms; Chinese subsidiaries are not required to be audited except for one, which is not material to the Group.
• The change complies with Singapore Exchange Listing Manual Rules 712, 715, and 716.
• There were no disagreements with Deloitte on accounting treatments in the past 12 months, and Deloitte is not resigning due to any dispute.

In-Depth Details and Implications for Shareholders

The Board of Koda Ltd has announced a significant change in its audit arrangements, proposing to appoint Forvis Mazars LLP as the new group auditor effective from FY2026. This move comes after more than two decades of auditing by Deloitte & Touche LLP, which was first appointed in July 2000 and last re-appointed in October 2025.

The rationale for this decision is twofold: firstly, to enhance corporate governance by introducing fresh perspectives from a new professional audit firm, and secondly, to manage business costs more efficiently. The Board expects a substantial reduction in audit fees—about 27.9%—which could have a direct positive impact on the Group’s profitability, especially since there will be no change in the audit scope.

The evaluation and selection process was rigorous, taking into account criteria from the Guidebook for Audit Committees in Singapore, audit quality indicators required by ACRA, and the adequacy of resources and experience of Forvis Mazars and their engagement partner. Mr. Ooi Chee Keong, who will lead the audit, received a satisfactory review from ACRA’s Practice Monitoring Programme in 2023.

Auditing arrangements for subsidiaries have also been addressed: all Singapore entities will be audited by Forvis Mazars, Malaysian and Vietnamese subsidiaries by overseas member firms, and Chinese subsidiaries are generally not required to be audited, except for Commune (Dongguan) Trading Co. Ltd, whose financials are not material to the Group.

Deloitte’s resignation as auditor has already been approved by ACRA and took effect on 9 March 2026. Forvis Mazars has confirmed its willingness to act as auditor, contingent on shareholder approval. There have been no disagreements with Deloitte on accounting matters in the past year, and Deloitte has confirmed that there are no professional reasons why Forvis Mazars should not take over.

The appointment of Forvis Mazars is contingent on shareholder approval at the upcoming EGM. If approved, Forvis Mazars will serve until the conclusion of the next AGM.

Potential Price Sensitivity and Shareholder Considerations

• Cost Savings: The projected 27.9% reduction in audit fees could lead to improved profitability and may be seen as a positive move by investors.
• Corporate Governance: The change after 25 years signals an active approach to governance and oversight, potentially improving investor confidence.
• Audit Quality: The Board has taken steps to ensure audit quality and compliance with regulatory requirements, reducing the risk of future audit-related issues.
• No Dispute: The absence of any disagreements or circumstances between Koda Ltd and Deloitte should reassure shareholders that the change is not due to any underlying problems.
• Shareholder Approval Required: The final decision rests with shareholders at the EGM, making this a key upcoming event for the Group.

Next Steps

Koda Ltd will issue a circular to shareholders with further details and notice of the EGM. Investors should monitor announcements for the EGM date and review the information provided before voting.

Conclusion

The proposed change of auditor is a notable event for Koda Ltd, with potential positive implications for cost management and governance. Shareholders should pay close attention to the upcoming EGM and the details provided in the circular, as their approval is required for the transition to Forvis Mazars LLP.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own research and consult professional advisers before making investment decisions. The information is based on official company disclosures and may be subject to change.

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