30th May 2014 08:51
LONDON (Alliance News) - Central Rand Gold Ltd's shares were suspended in London Friday at the request of the company, as it awaits clarification from its auditors of the accounting treatment of a loan in its 2013 accounts.
"In the unaudited financial statements released on 16 May 2014, an element of the Redstone convertible loan note was treated as equity. However, on a technical review from the auditors as the audit process was finalised this element has been reclassified as a derivative liability with a consequential impact on the company's results," Central Rand Gold said.
It said it will publish revised accounts as soon as is practicable.
Redstone Capital Ltd is a cornerstone investor in Central Rand Gold, after injecting US$7.25 million into the company last August through a convertible loan. It currently has a stake of 31.91% in the company, after also investing a further GBP2.1 million through the company's open offer in January. That stake would increase to about 67% if all its loans and warrants were converted.
By Steve McGrath; [email protected]; @SteveMcGrath1
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