I have raised this issue previously
"Sargon receivable
The sale consideration for the Trustee business of $43 million comprised $12 million of cash which was received at completion and deferred consideration of $31 million. This deferred consideration receivable is due to be paid by Sargon Capital Pty Limited (Sargon) by 30 November 2019. The deferred consideration is secured under a general security deed, registered on the Personal Property Securities Register [all that means is that any party dealing with Sargon financially is able to search and find that Sargon owes this sum of money to OVH, nothing more] and is subject to the provisions of the Share Purchase Agreement under which the performance of the Purchaser’s obligations can be enforced. Sargon have given no indication to OneVue that they will not be able to or do not intend to pay this amount by the due date. [of course Sargon would not inform that]
OneVue’s auditors Deloitte have qualified their audit opinion in respect of this deferred consideration as in accordance with Australian Auditing Standards the scope of their audit has been limited as they are not able to form a view as to the recoverability of this deferred consideration. Given its materiality they have sought and been unable to obtain sufficient appropriate audit evidence to enable them to confirm whether Sargon has the capacity to pay and that the deferred consideration will be recoverable by OneVue. Sargon has no obligation to provide any evidence under the Share Purchase Agreement. Sargon is a large private company and therefore is not required to lodge its 30 June 2019 financial statements until 31 October 2019. [How financially large is Sargon?, it may be known when they lodge their financial reports by 31 Oct 19] The audit opinion qualification is specific and limited to the audit of the deferred consideration."
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- Ann: OneVue FY19 Annual Report to Shareholders
Ann: OneVue FY19 Annual Report to Shareholders, page-8
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