ARBB is in net cash position.

When company is in net cash position, it takes special skills to bankrupt the company. (Peter Lynch, 1998)

Sitting on 82mil cash as on 31 Mac 2022.

Waiting to deploy for new centralised farming controls in view of labour shortage translates to high productivity.

ARBB market capitalisation at 124mil with over RM375mil “net” assets make it safe investment

ARBB PA has expiry in Jan 2024 with gearing at 5.2 x is very attractive.

Scenario
When ARBB moves from 11 sen to 16sen translates to +45% increase
But
ARBB PA will move from 2 sen to 7sen which translates to 350% increase!

Please do your research before you invest.

Disclosure: I am long on ARBB and ARBB PA and may increase my positions in the next 72 hours.

Appreciate the contributions from Neon, Bossku, Line et al.

The best kind of investment is to
1. evaluate the business moats. Do people need affordable cloud business? Are companies migrating to Online business? Is ARBB a leader in cost effective pricing for its products?

2. calculate for every RM1 you invest, how much you get in return from now to Judgement Day

3. Quantify the future profits or even losses to Present value using Discounted rate

I don’t know what ARBB and ARBB PA prices will be tomorrow, next week or next year. But I do know that the valuation is very likely to increase over time as the businesses are wonderful with very good management.

To emotionally speculate what the future is going to be like is like predicting casino games outcome. But we all do have sufficient information to make inform decisions.

Disclosure: I am biased on my opinions as I own part of ARBB via its parent shares and PA.

CEO Larry Liew is major Top 30 largest shareholders in ARBB and also in AGESON and ANNUM

AGESON is in construction business with Property Development opportunity JV with Perak Government to develop low - mid costs housing.

ANNUM is plywood products with impressive increase in Revenues from 53.4mil to 265mil and Profits from 4mil to 57mil over 2020 to 2021.

Both AGESON and ANNUM is likely the contractor for ARB for the Hydroponics project in Kelantan.

Interesting to note that ANNUM Top 30 Major shareholder is HOOYA HYDROPONIC SDN. BHD. (201801040530) with 3.6mil shares or 3.7% of ANNUM shares capital.

This model is similar to Conglomerates like Some Darby, Sunway and OSK where they award contracts to sister companies.

Opportunities:
1] ANNUM looks attractive in valuation but they don’t have sustainable continued revenues stream after ARB completed its 200 Hydroponics green houses.
2] ARBB Major Shareholder and CEO Larry Liew is strategically capitalising revenues to his 3 holding companies.
3] Food Inflation in Malaysia is expected to hit >6% vs generic inflation of 3.2% (Bank Negara Malaysia) This is good for Hydroponics vegetables as it is much lower costs and minimal pesticides use
4] In 2020, ARBB won

a] Prestigious Malaysia Technology Excellence Award - IOT division
b] Asia Pacific Enterprise Award
c] International Prestige Brand Award

The above reinforces that ARBB is emerging technology leader in Malaysia with Revenues already >300mil for 2021.

Risks
1] Remains to be seen how the Hydroponics vegetables sales will perform.
2] Weather conditions risk

RECOMMENDATIONS
ARBB PA - a buy with exercise price at 14sen.

The conversion price = Market price + Exercise price
16.5 sen = 2.5sen + 14 sen

ARB Parent - BUY
Share price at 11.5sen with
ROE of over 12%
PE Ratio <2times
PE Ratio exclude one off profit recognition in purchasing subsidiaries 4.1 times
Benchmark against industry : Mesiniaga, Aemulus, Globetronics are at 24 to 39 times.

ARB listing proposal in Nasdaq is a non-event to me as I am delighted with the business it operates and not merely making it shares available to more Stock Exchange platforms.

Sources:
ARB Annual report 2020
Annum Annual Report 2021
Ageson Annual Report 2020/21

Disclaimer: Please conduct your due diligence so that you purchase wonderful business at reasonable price and not purchase reasonable business at wonderful price (Warren Buffett, 2011)

Disclosure: Long on ARBB and ARBB PA and may increase stakes in the next 72 hours of this time of posting.

Hi Messrs Line,

You asked relevant questions and I am worried that there are
x no customers
x no termination clause to stop losses

WHY INVESTORS AREN’T THE SAME AS MANAGERS?
However, as investors, we have no access to managerial day to day decision. Example, we cannot stop Maybank from launching MAE Apps, QR Pay and opening new branches. But we can use CORPORATE GOVERNANCE meaning third parties to evaluate n scrutinise their activities if it is best interests of shareholders. - Please CAREFULLY read my earlier posts. the same principles are studied in World Class Chartered Accountancy Advance stage - ACCA (UK).

HOW CORPORATE GOVERNANCE (CG) WORK?
Consider this, Pakatan Harapan (PH) and more famously Dr Mahathir exposes the previous PM (PPM) corruption. He openly say PPM is penc*ri or Thi*f. Dr M cannot stop PPM from diverting lots of fund to IMD bee by he is using CORPORATE GOVERNANCE tool to expose PPM to public.

The public decides. Some accepts teh Thi*f. (Later PPM was convicted in Court for corrupt**n, some won’t accept. So Malaysia’s >12.8million spoke in Gen Election 14. 46% voted for PH and PPM and his Coalition BN gained 34%. resulting in change of management after >60 years in power. .

HOW CG APPLIES TO BURSA?
similarly, there are CORP GOVERNANCE tool that scrutinises Maybank, Serba Dinamik, Petronas and 1400 listed companies in Bursa. CG is not perfect but a lot more effective than to allow no scurtiny.

The same CG mechanism is used to scrutinise ARBB like the rest.

Study this and you will be better and profit much as an investor. We cannot guarantee against mismanagement but it is lot harder to do so with CG.

CG is a huge factor that governs UK and USA.

Confident this clarifies.

Mesrrs LINE, encourage you to contribute with facts after you study ARBB’s Financial Statements. then we appreciate you more. You asked many questions but they were already answered earlier in my posts.

My objective is to ADD VALUE to public that ARBB is worth the business risk to invest and I voted with my feet.

Source: https://en.wikipedia.org/wiki/Results_of_the_2018_Malaysian_general_election_by_parliamentary_constituency
Note: I hope this wikipedia is roughly right on its GE 14 facts.

Disclosure: Have position in ARBB WA.

Who am I: Using Biotech technology of >20 years track record registered in Doctors Reference Book, USA, providing health solutions (Hypertension, Diabetes , chronic diseases) to CUT PAIN and CUT COSTS
W-ap ps : Zero 1 zero 22 Five 41 two eight.

Do you lose Money from injecting RI?
No. You are merely allocating more investment fund for ARBB’s Hydroponics agriculture AI project

Will ARBB lose money in this investment?
Short term: High set up capital costs at initial stage and only expect profits in Year 2 or 3 onwards. Expect P&L for 2022 have muted profit performance in range of RM25mil- RM35mil per year.

Post RI (assuming 100% subscription) : PE Ratio at 3.5 times - the cheapest valuation in Technology sector, Bursa.

What will happen to POST-RI?
Price will be adjusted similar to current price at 12sen simply because the market price PRE-RI and RI Exercise price is range 12sen to 13sen.

Will there be mismanagement or leakages arising from fraud?
- please read my earlier posts on Corporate Governance analysing External Auditor’s report.

Should I subscribe to RI?
High Risks Tolerances investors - YES. I want my company to invest pioneering hydroponics investment for local demand and exports opportunities. The first mover advantage in country.

Low Risks Tolerance - NO. I prefer ARBB to have stepped up investments to gradually invest in Hydroponics project using internal fund. Note that ARBB has RM23million cash as at 09/2021

How confident is management on this project?
CEO Larry Liew is FULLY Subscribing to RI amount about RM6million with personal fund. Tells you a lot on how confident he is with the project from his experience in IT / AI in China.


Please call Share Registrar to for more information.

AldPro Corporate Services Sdn Bhd Level 5, Block B, Dataran PHB Saujana Resort, Section U2
40150 Shah Alam
Selangor Darul Ehsan
Tel : +603 – 7890 0638 Fax : +603 – 7890 1032


Disclosure: I am long on ARBB WA and may increase my holdings in next 72 hours.
Who am I: Using Biotech technology of >20 years track record registered in Doctors Reference Book, USA, providing health solutions (Hyperension, Diabetes , chronic diseases) to CUT PAIN and CUT COSTS
W-ap ps : Zero 1 zero 22 Five 41 two eight.


Source: https://www.bursamalaysia.com/market_information/announcements/company...

+++++++++
Reposted: traderTRX
i need u guys' opinion on the RI, at this point, it looks like no point taking it right? we 3 options, to subscribe, to sell it, or to do nothing right? at the current price of 0.01 (based on mpluss) all 3 options will make us lose money? betul tak?

wiseinvestor123 - excellent research to get this interview
I heard it too and am impressed with CEO Larry Liew comments. Note that in 2019, he wanted to expand aggressively in IT sector. He did exactly that. today, ARBB Revenues grew >100% since his last BFM interview.

Meaning? This is Corporate Governance in that CEO promises something and delivers on it.

Don’t get me wrong, ARBB is not growing linear upwards. Expect slow down in revenues growth and profit in 2022 to digest all the new acquisitions and new businesses.

wiseinvestor123 - you have very good business mind to figure this out. Who knows, you might be the next Dato Larry Liew, yourself - in a good way. Be your own CEO.

Thank you for you good work.

Disclosure: Have positions in ARBB WA and may add more in next 48 hours in time of writing.

+++++++++++++++++++++++++++++++++++

Reposted
wiseinvestor123 > Jan 21, 2022 11:10 AM | Report Abuse

Here is a podast that can shed some light on ARBB business - https://www.bfm.my/podcast/morning-run/the-breakfast-grille/from-timber-to-tech

I will comment on
A] CORPORATE GOVERNANCE
B] BUSINESS STRATEGY
C] ARBB SHARE PRICES
D] MY BACKGROUND - ADD VALUE TO YOU

enjoy.

A] CORPORATE GOVERNANCE: Independent parties who scrutinise and report company’s actions to public based on Transparency.

>99.98% companies Bursa Malaysia runs legitimate businesses. There are many Third Parties authorities monitor them including External Auditors, Bursa Authority, Malaysian Corporate Governance Body.

Case study: Since 1993, Maybank has increased in value over 1000% including dividends. Difficult for Exec Directors to defraud the shareholders using fund for personal use. Possible, but very difficult

Just as someone trusts Maybank, YTL Power, Atrium REIT because of teh system of monitoring, why cannot someone trusts it to monitor ARBB?

Anyone who commits fraud, they have to weigh imprisonment & fines risk. if with fraudulent intention, why do it in public via Bursa Listed company? Isn’t better to set up private Ponzi scheme?

Answer to Messrs TanKarKeong59: No, the authorities won’t allow colluding frauds if they don’t want to collapse investors confidence and economy. Too much to lose over a small cap company.

B] BUSINESS STRATEGY
Good to use business judgments to evaluate if ARBB business strategy is workable? Apply SWOT analysis.

Shareholders don’t need to ask operational matters like how much are the Greenhouse costs or where are the customers. Otherwise you need to work as project manager in ARBB to understand the costing. Shareholders invest trusting managers to perform in their best interests with Corporate Governance to keep them in check..

Relevant questions:
Can rivals copy ARBB? Patents pending, First mover advantage, Passionate skilled engineers.
Can customers after using its servers Online subscriptions, switch to rivals?
What ARBB pricing powers are?

This requires personal skills to analyse.

C] SHARE PRICES
Get cautious when others are greedy
Get greedy when others are cautious. - Warren Buffett. Note, the world was ‘ending’ during World War 2, but he bought stocks in 1942 after Japan bombed Pearl harbour. Do you see how bearish investors were? Is this similar bearish stance on ARBB?

I am delighted when I see contirbutors criticising ARBB on shallow grounds. I welcome this because i can see people’s perspectives. The general mood is bearish. This is opportunity for me to pick up the shares on the cheap. Thank you for that.

Appreciate some really good contributors explaining IOT, Growth prospects, AI, as such knowledge helps shareholders to make informed decisions. Thank you guys, you are doing good job here.

Read my earlier posts on powerful tools to monitor ARBB’s performance and if there are grounds for fraud n negligence. No one can guarantee 100% but your relative confidence is a lot higher on public listed company. Look at Serba Dinamik worth >RM5billion and not is suspended at value worth RM1billion. A 80% drop! Do you think Bursa will not take action against small companies if they detect malpractices?

D] BACKGROUND - ADD VALUE TO YOU: I am Chartered Accountant (UK) by qualification involving in Bio-tech CUT-Pain CUT-Hosptial Costs Business (similar concept to Grabcar with little capital). >22million of our brothers and sisters in Malaysia have serious cholesterol level leading to Heart Failure, high blood pressure leading to strokes and diabetes - and GROWING. I am working actively helping victims in PAIN to WEAN OFF toxic drugs like Amlodipine and/or cancer causing Metformin. No more hypertension or diabetic ulcers risks.

Disclosure: Long on ARBB WA and buying more in next 72 hours.

Note: Caveat Emptor.

WhatsApp: zero - one - zero - 224 / four - one two/ eight.
+++++++++++++++++++++
reposted from TanKarkeong59: MACC should this company because they collude with states government and agencies, like USM, MBI KEDAH, MBI PERAK to trap investors. And also SC, why they allow them to keep playing this tricks

For CEO Larry Liew to invest own money is huge vote of confidence. Insiders ownership will result in optimum benefits for ARBB.

Another factor for my confidence in addition to my earlier write ups on Corporate Governance and Business Strategy:
1] External Auditors reported EXTRA investigations on Receivables of >12 months
2] BUrsa as regulator
3] News reports
4] THIRD Party awards

On Strategy:
1] High growth prospects in ERP
2] High growth prospects in IOT
3] Competent staff
4] Agressive expansion in COSEC
5] Successful launch in VIRTUAL AGMS like Google Meet
6] successful divestment from Wood products
7] successfully acquiring IT companies at DEEP DISCOUNTS amount to RM33.9million

I expect profits growth to slow to 15% per year in 2022, but that is still very very impressive .

PE RatioEXCLUDING one off profits from Acquisitions made at fire sale prices = 2.2 x

Peg PE & Share prices
11 x = 67.5 sen
15 x = 92 sen
21 x = 129 sen

Caveat Emptor (Let the Buyer Beware. Invest but with due research)

Disclosure: I own ARBB WA.

RJ 87,

I am impressed by your Business mind and Game Theory (meaning why the other party is doing this and what I should do in response?) at play.

I postulate that Larry Liew actions for RI at 12 sen per share

Larry’s current holding: 51million Ord shares as at 9 Dec 2021. He already stated he will FULLY subscribe to the RI

He wants to DOUBLE his shareholding and thus need to subscribe all thus the amount is
12 sen x 51 million = RM6.12 million . A sizable amount for him to pump into the company. if the exercise price is HIGHER, it may exceed his budget or risk tolerance to put more funding. Thus, RM6.12million is his maximum.

Let us see how it works for CEO and ARBB.

SCENARIO A: ONLY Larry Liew subscribe the RI.
Before RI , current Shares : 608million
RI - Larry Liew 51mil
After RI Shares total 659million

Larry’s Total Shares double to 102mil which increases his voting rights to 15.6%

He becomes largest shareholder and thus have stronger managerial control

Verdict: He wins in that he has more controls but Hydroponics business will be invested in phases ie build 10 glass houses and plough the profits to build another 15 and so on until you reach 50 units. Longer time to build allowing rivals to imitate, assuming they have the IOT competence.

SCENARIO B: ALL current shareholders subscribe the RI
Before RI , current Shares : 608million
RI - all Existing Shareholders subscribe 608milion
After RI Shares total 1216million

Additional investment RM72million for Hydroponics and be the First mover advantage to take the modern farming fast.

Verdict: He wins and so does ARBB in that the Revenue and profit growth accelerates which translates to higher share price. Target at Post RI PE Ration at 3 x, it should be 15 x , thus the shares should be fairly valued at 67.5sen. , a 500% increase.

Other thoughts
I wish ARBB would hire more cost efficient agent as the current firm, Mercury Securities S/B, charges RM710,000 for the exercise. costly for a small firm. very costly, indeed.


RJ87 - Good insightful comments. Thank you .

To more profitable future

Source: ARBB Announcement dated 9 Dec 2021. Bursa Malaysia

Disclosure: Long on ARBB WA and may add more positions in next 72 hours

**************************
Reposted from RJ87

GOT. PE less than 2. Fintec. The quarter they report 720M profit.

ARBB only need 4(FOUR) guys to make up this 85.2million shares for 98.2%.

If there is something worth checking; that would be who is the one getting the project to setup 275K per greenhouse. If Larry is not dumb, it won't be Prinsiptek. Technically, it's not Prinsiptek since it's Ageson now. Good chance that's also where ARBB gets his RM23M cash from.

You are right on the take up rate.

But if you see the combo of corporate exercise since 2018. It appears to be that each corporate exercise is to use retailers money to own the company for free. Like you know, this Larry is paid to dilute the shares. To raise RM120M for him to spend and he decides on how to spend them. It makes no sense to RI at 13sen. Unless, he wants to take up all for himself. =D

ur Implication B is inaccurate. RI at 13.5sen means if I can buy RI 13.5sen, why should anybody buy anything above it? The question is, WHY RI at 13sen devaluing the company by more than half is more pressing. RI at 26sen with half the proposed shares can get him his RM120M. Why not 26sen? Especially, according to you, they hv good business running behind. So good, RI at 30sen also ppl sapu la. Now, where is the problem?

Its not something Larry doesn't know. What's not known is why he did it? Why do you think he did it is a better discussion. Everything has a cover story and the truth behind it. What you have shared and discussed so far are only cover story. What's more important is the truth.

For the Benefit of Transparency and clarification,

The Rights Issue (RI) was approved based on the TOTAL VOTES of 85.2million comprising of 31 individual shareholders. This is 8% of ENTIRE Shareholding votes or 1.075 BILLION Shares.

Of these 85.2 million vote shares:

98.2% / 83.69million voted FOR RI
1.8% / 1.52mil voted AGAINST the RI

What are the possible implications?

Implication A:
98.2% is very strong sample that majority of ARBB shareholders want the RI to go ahead and fund the innovative Hydroponics Project

Implication B:
there are SILENT MAJORITY or 92% of entire shareholders who didn’t participate but are against it as reflected by the Share sell down from 30sen to now 13.5sen.

We will know the outcome when we see how many Percent of RI are subscribed.

INVESTOR Choices
CHOICE 1. invest in stock with insane PE Ratio of LESS THAN 2. I have never seen this in my 30 years investment in Stock Exchange.

I attended the last 2020 AGM ARBB and understand that Larry Liew has new projects and new patents pending approval in Q2 2022. This is extremely exciting. Reflect another Patent - R&D centric firm UCHITEC on coffee maker semi conductor chips. their stocks + dividend are 5-baggers (+500%) over about 15 years. One can expect ARBB to go up much faster because of its valuation.

CHOICE 2. you can wait for 12 months and see how the Hydroponics project progress. Expect high initial set up costs and thus subdued profits.

Don’t forget that ARBB has other ongoing profitable projects and with Cash >23million for working capital while the RI are for Hydroponics Project. Note that ARBB cannot use the fund for purposes other than what it told Bursa Malaysia Commission. to change it, they need AGM to amend the resolution.

MY OPINON
As businessman myself, we should be shrewd. I would have preferred CEO Larry Liew to invest in phases. Try with 10 Greenhouses and plow back the profits to build the next 15 Greenhouses until you reach 50. But if he is making right business risk, this will take off in large way as it solves the labour shortages in agriculture sector.

Disclosure: I have interests in ARBB WA.

The Meeting with ARBB staff was commercial interests as we want our clients to migrate to ONLINE Co Secretary which is much more efficient, time savings and client friendly.

Meeting lasted for 90mins. The Marketing Manager has strong technical IT Engineers and they are really passionate about their work. Take pride in that they are building the next Accenture / SAP / Oracle in Malaysia. Expanding in SEA countries , they are open

Understand CEO is very innovative, solutions provider and above all INTEGRITY. this is important factor if you want to invest in company.

Disclosure: I am long on ARBB WA and may add positions in next 72 hours.

Appreciate the CONSTRUCTIVE contributions from Whistleblower, Neonstrife, EastWestTalker, BosskuFanboy and few more contributors . Indeed well researched and professional objectivity. This is really good.

As Chartered Accountant and also lecturer in Audit & Fraud investigation, I am worried over the company’s legitimacy. we seen companies like Serba Dinamik with serious lack of transparency issue. now suspended as we speak

This is too late for us as investors if similar thing happens as we will lose our hard earned fund.

Without any intention to elaborate further, I wish to share w you good investors, that I have made communication with COSEC marketing manager. He is remarkable with strong understanding of grasp of industry. More excitement are coming w new upgrades n product launches. What they are, I am not given.

Legit business, that is what I observe.

PS: see my earlier analysis on Corporate Governance and External Audit Report. my confidence is relatively much higher after reading the Audtiors’ findings. The auditor follows same standard of audit as worldwide auditors including Ernst & Young, KPMG and co hurts.

Case in point, when E&Y reported irregualirities in Serba Dinamik accounts, they took their ground. WHY? SO powerful the evidences that it is admissible to High Court. You can see the S/D manageement if fighting to prevent the report from being published.

ARBB auditor uses same technology on audit to obtain SUFFICIENT APPROPRIATE AUDIT Evidences to support their opinions. No 100% sure in life as this will mean unjustified high audit fee but much higher confidence.

Disclosure: I am long on ARBB WA

Bonus Point

Corporate Governance risk is low. Pls see my earlier posts.

Keep happy and earn intelligently.

You don’t have to be right all the time. Make more right Investments decisions over wrong ones. (Warren Buffett)

Focus on Gig Economy. You can earn too without capital, use intellectual capital instead. Think Grabcar model

Cheers.

I agree with Contributor Line that Negative Goodwill is a ONE OFF gain reflected in P&L. That I am thankful over factual remark.

Let’s benchmark with hot Tech stock JF Tech w ARBB.

9 months Profit = 56mil
Less One off gains = (36m)
Profit from operations = 20mil

Extrapolate to 12 months, expect
Turnover = 248 mil (assumed 20% increase revenues due to consolidating acquired 3 new co)
Net Profits. = 27mil (assumed no increase in profits due to increase growth in set up costs)
Market Cap = 105mil
PE Ratio = 4X! (stripping off ONE OFF GAINS ON ACQUISITION)
Patents = 10 target Q1 2022.

Benchmark to
JF Technology Berhad
Revenues = 50 mil (assume 20% increase, while factories in Kota Damansara & China plants under construction}
Net Profits = 20mil
Market Cap = 1,386 mil
PE Ratio = 69X!
Patents = 13

“The true investor welcomes volatility … a wildly fluctuating market means that irrationally low prices will periodically be attached to solid businesses.” - Warren Buffett.

Verdict: Accumulate ARBB on dips.
Parent : 17 sen
Warrant : 3.5 sen

Note: Chips shortage affects iPhones sale but not IPHones software games & Apps. Another advantage of software co over hardware maker.

Disclosure: I am long on ARBB PA and may buy in next 48 hours of writing.

ARBB is NET CASH Position

It takes special skill the bankrupt the company (Peter Lynch)

Every Listed company has to report to Bursa over their activities.

For me, I hope tomorrow the shares and warrants drop. Opportunity to buy more.

alternatively, see the news that ARBB launch products.

How can they do that if this is a hoax? Major newspapers including The Edge covers their product launch.

Case : Serba Dinamik cannot change facts. EY Audit firm stand by their findings. they have facts enough to prove in court.

Lesson: if you have THIRD PARTIES to verify it, this is powerful. Possible for fraud. YES! but tough to hide. Case : Madoff scandal. But how many? 1 in 100,000. This is lower risk than if we put fund in start up business.

You can see my earlier comments on Auditors’ Report on ARBB. they expressed concern over the Receivables owed >12 months. and yet, they are satsified that the debts are legit w 5 ADDITIONAL Audit investigation.

All audit firms follow International Auditing guidelines. Difficult to escape their notice but possible.

Good question.

I recommend, pose as customer. call ARBB. ask for demo. share with us here.

This is good way to verify. I totally agree with Albukhary

2. ARBB keeps buying Software companies at deep discounts. Thus far, bought companies with discounts by RM35million. Think of buying a landed property house in Bukit Damansara, KL at huge discounts compared to neighbours’ market value

3. ARBB plans to have 10 patents filed in Q1 2022. Competitive advantage that rivals cannot imitate

4. ARBB is visible and transparent. it announced new products like “ZOOM like” AGM software. Hydro-ponics investment. These need THIRD Parties to evaluate like submitting to BUrda for approval and Finance Consulting firm to file and announce to public. If ti has much to hide, don’t you think any firm will give vague statements?

5. Rights Issue. Shareholders have spoken! They reject. Likelihood convert the capital raising exercise through Private placements.

Those who hold ARBB PA will not be disadvantaged because Bursa and Company Law disallow it! Period.

Conclusion
Accumulate aggressively. This is recession proof barring unforeseen occurrences such as cunning deliberate fraud. Can happen. Case is Enron. WOrld’s leading Arthur Andersen Audit firm collapsed because of the scandal. The risk is 1 company in fraud out of 35,000 NYSE listed firms. Similar kind of risk in any Stock Exchange.

About ME: I am Biotech consultant with >30 years investments. I don’t recommend stocks to buy or sell but my mere opinion. My brothers and sisters, you are advised to conduct your own research

Disclosure: I am long on ARBB PA and may buy more in next 72 hours at this time of writing.

Is ARBB Financial Statements legitimate and reliable?

1. Salient points from Q3 /2021:
Receivables reclassified as Current Asset meaning the debts are recoverable within 12 months. How is this possible?
Eg. Debtor owes ARBB 10million and the earliest invoice is >12 months. Thus, the Debtor with portion >12 months must be classified as NCA (Non Current Asset)

However, if company pays 9mil now and then immediately place orders worth 9.1mil, technically, the debtor paid old debt but immediately incurred new debt. There is no inconsistencies. To Debtor’s cashflow is unaffected.

Note that Receivables have REDUCED to ZERO in NCA but Short term receivables INCREASED by 44 mil to 112mil. Justified in view that the turnover has increased significantly 19m compared to Q3 2020.

Key takeaway: The biggest risk of bad debts is substantially reduced with ZERO Long term Receivables.

Larry Liew, CEO,wants clients to subscribe monthly fee rather than purchase ERP outright. Smart move to reduce clients’ need to invest and making ERP affordable.

PART 7 (FINAL)
Few questions before investing:
1. Is Info Tech the way forward in this ecnomic times in next 10 years?
2. Does ARBB offer unique services that rivals are unable to copy?
3. Will you expect Work at Home, Internet of things using Handphones, Auto gates, Auto Airconds, Automobiles, Auto Microwaves as the growing trend in next 10 - 15 years.

My humble opinion, ARBB Financial statements in 2020 are legit based on above findings.

I quote our generation’s most famous greatest investors:

You want to buy a wonderful business at reasonable price and not buy reasonable business at wonderful price. (Warren Buffett, 1997)

If You Can't Stomach 50% Declines in Your Investment You Will Get the Mediocre Returns You Deserve (Charles Munger, 2008)


May you profit from investing in your personal investing knowledge and Stock Market.

Disclosure: I am not working for ARBB and an entrepreneur seeking potential Business partners in Asset Light Business model. I am long on ARBB PA and may add my position in the next 72 hours from the time of this writing.

PART 6 :
KEY TAKEAWAYS
To be concerned about the Receivables is certainly justified. After you review audit disclosures, this should reduce our fears, relatively speaking.

As investors, you look at the business model with wide moats and review the Corporate Governance before you invest.

PART 5
STRANGELY, WHY DID RSM DECIDE TO RETIRE AS ARBB’S AUDITORS FOR COMING 2021?
Most likely reason is RSM is a profit seeking firm. Look at the amount of audit procedures performed above meaning the resources on time and labour incurred. RSM partners possibly perceive the job is profitable enough. Bear in mind, External Auditors CANNOT cut corners to reduce costs and protect profit margins. They are liable to lawsuits and major accounting firms went bankrupt such as Arthur Andersen.

PART 4
WHAT ADDITIONAL AUDIT PROCEDURES OR EVIDENCES THAT RSM UNCOVER AND TRANSPARENTLY REPORTED ON?
RSM provided 5 disclosures on why they opined that the receivables are reliable valuation:
1. Developed understanding of the design and implementation of controls associated with the monitoring of outstanding receivables and deposits impairment calculation.
2. Developed understanding of significant credit exposures which were significantly overdue or deemed to be in default through analysis of ageing reports.
3. Obtained confirmation of balances from selected debtors and suppliers.
4. Checked subsequent receipts, customers/suppliers correspondence, and consider level of activity with customers/suppliers and management’s explanation on recoverability with significantly past due balances.
5. Assessed the reasonableness and calculation of expected credit losses as at end of the reporting period.
(Source: ARBB Annual Report 2020)
No External auditors can give absolute or 100% confirmation but gives reasonable relative assurance that the balance are valid but it increases our investors’ confidence because they perform the audit procedures independently or without interference from Executive Directors and manages.

PART 3
WHY RSM’S AUDIT REPORT WILL IMPROVE YOUR CONFIDENCE?
RSM is major mid size International Audit firm who reviewed ARBB Financial statements for year end Dec 2020. There is a new audit report format that requires Auditors to focus on Material Risky Items and you guessed it right - the Receivables of >1 year carrying value at RM102m as at Mac 2021 certainly arise.
RSM is required by ISA (International Standards of Auditing) to perform additional audit investigation that the material risky item is fairly stated ie it is not fictitious or that is should it be classified as bad debts in view that customers have not paid for over 1 year.

Part 2:
WHY HAVE REASONABLE TRUST IN ARBB’S FINANCIAL PERFORMANCE?
As a public listed company, ARBB is no different and scrutinised or watched by authorities such as
= Independent Non Executive Directors
= Bursa Malaysia
= Licensing authorities
= External Auditors
= Institutional shareholders
= retail shareholders
= Anti- Corruption Agency
= Transparency on need to disclose its reports to public
= 3rd party & Independent Awards to CEO Larry and ARBB by Prestigious APEC (Asia Pacific Enterprise Award) in 2020. (Source: https://apea.asia/regional/hall-of-fame-2020/corporate-excellence-category-2020/arb-berhad-ce/ )

PART 1 :
WHY ARBB is NOT THE SAME AS SERBA DINAMIK’S TROUBLES? CORPORATE GOVERNANCE PERSPECTIVE.

MY BACKGROUND
I am qualified Chartered Accountant >20 years and ex-ACCA lecturer in Corporate Governance , Advanced Audit and Strategy. Now an entrepreneur in my rapidly expanding Gig Economy Biotechnology platform seeking Flexi-hour business partners. My 2 sen worth is possibly helpful to our readers.

Reloyee is right that the market is skeptical about ARBB business model with Receivables parked under Non Current Assets. Highly unusual. (Source: https://klse.i3investor.com/blogs/reloyeeanalysis/2021-07-07-story-h1567859744-Another_Serba_Dinamik_Look_Deeper_into_ARB_Berhad.jsp)

WHY VAST MAJORITY OF PUBLIC LISTED COMPANIES FINANCIAL STATEMENTS ARE RELIABLE?
We hear stories about Serba Dinamik fiasco. Can you name 10 such companies involved in alleged mal-practice or even alleged fraud in 2020/21? Remember that Serba Dinamik, thusfar, has no convictions in court meaning you are innocent until proven guilty. There are over 1400 Public listed companies in Bursa Malaysia. With 1 black (unpopular) sheep, does it mean that all 99.98% Public listed companies like Carlsberg, Maybank, YTL, Nestle are distrusted? Certainly not.