Fastfood company KFC Holdings (Malaysia) has suspended its managing director Datuk Johari Abdul Ghani, it said in an announcement to the financial markets.
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“The board of directors of KFC Holdings (Malaysia) Bhd has on 11 July 2005 resolved to suspend YBhg Datuk Johari Abdul Ghani, being the group managing director of KFCH Group, for 21 days and subject to further review so as to enable the group managing director to respond to the findings of the PriceWaterhouseCoopers High Level Business Review,” it said.
According to the news agency Bernama, which quoted a separate statement by KFC, the decision, with immediate effect, was made after the board was presented with a detailed report from PwC at a Board meeting.
The news of the suspension came after a last minute postponement of a press conference by KFC to brief the media regarding recent development in the group.
KFC had mandated PwC in May to carry out a high level business review to cover the group’s financial position, operational procedures and contractual obligations.
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By GlobalData“The Board has taken time to understand and discuss the PwC report at length. We are all perturbed at the extent of the shortcomings revealed in the report,” said KFC chairman Tan Sri Nik Ibrahim Kamil.
“We want to know what the problems are in the company so that we can put it right and move the company forward towards profits and transparency,” he added.
He said that the board has also agreed to mandate PwC to continue to the next stage, and proceed with a full detailed forensic investigation.
KFC said that one of the issues raised by the report has to do with the supply of soft drink with Permanis (Pepsi contract).
Another point highlighted was the matter of excesses, in particular, the cost of maintaining the two directors — Datuk Izhar Sulaiman and Johari — amounting to nearly 5m ringgit (US$1.3m) per year.
The figures include, among others, general expenses, gifts and credit card expenses, it said. In a summary of the PwC report, KFC also noted the sale of a property in Petaling Jaya this year at the price below net book value, without any basis or evaluation done.
