SPH Media Files Police Report Following Investigation Into Overstated Circulation Numbers
When SPH Media revealed in a report that staff had overstated circulation numbers, everyone was in shock at the major oversight.
SPH Media Finds Inconsistencies In Data Reporting Over 1.5 Years, Senior Staff Leave Company
The incident saw senior staff leaving the company, as investigations commenced into the incidents that went unnoticed for over 1.5 years.
Now, findings from the investigations aren’t boding well for staff as SPH Media has apparently filed a police report for potential offences.
Some observations from inaccurate data reporting may count as offences
In a media release today (21 June), SPH Media shared that investigations into the inaccurate data reporting case concluded on Friday (16 June).
After studying the observations, the Audit and Risks Committee (ARC) has recommended that the company file a police report.
They arrived at this conclusion based on four key findings, which included:
- the inflation of circulation numbers in Listco’s Annual Reports for FY 2020 and 2021, as well as the submissions to IMDA and SingStat
- people from the Circulation Division involved in the inflation of numbers knew that undelivered copies were included in the figures (no evidence of the involvement of Listco Board or its senior management, except one person)
- some money from customers were booked into the NIE Fund as liabilities instead of revenue
- multiple red flags in X Barter Deal — unexplained variances in the terms and conditions and no evidence showing distribution of the digital activation codes
Analysing the above, the ARC concluded that staff had understated about S$100,000 of profits for the financial year ending 31 Aug 2021.
Source: Glassdoor
They also overstated roughly 82,600 copies daily on average for August 2021. The breakdown of the figures are as follows:
- Bulk copies via the NIE Fund reported but not distributed — 49,000
- Y Deal copies — 5,000
- School, Airline, Agency and All-in-One copies — 13,600
- X Barter Deal copies — 15,000
The last aspect may have even included an overstatement of revenue and expense of about S$830,000.
And since the key findings may constitute as potential offences, the ARC has recommended that SPH Media file a police report.
The police will then investigate further and decide if the reported matters are indeed offences.
No involvement of journalism or editorial departments
SPH Media noted in their media release that legal advisors from Allen & Gledhill LLP (A&G) found no evidence of the involvement of the journalism and editorial departments in the overstatement of the circulation numbers.
The actions the company took against staff and ex-staff prior to the findings were, however, said to be justifiable.
Meanwhile, SPH Media defended those who committed mistakes but remain in the company, saying that they were following superiors’ instructions.
They were thus seemingly acting under the belief that such practices were accepted in SPH.
SPH Media Group must reevaluate risk structure
Besides taking the matter up to the police, the ARC also recommends that SPH Media Group “enhance its risk management practices and continually improve its internal controls and processes.”
Among the suggestions are setting the tone with good leadership, ensuring the alignment of staff’s individual interests, and taking personal responsibility for managing risks.
They additionally listed the tenets for corporate governance and internal controls, which the Group will hopefully undertake.
To read the findings in detail, you may access the ARC report here.
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