Tree House Education and Accessories on Tuesday clarified to the exchanges that the nature of 'Receivables' in its FY15 balancesheet was consistent with the business practice. It added that the concerns raised by proxy advisory firm Stakeholders' Empowerment Services (SES) were "devoid of practical business realities".
Business Standard had reported the SES views on Tree House accounts last week.
In a clarification, issued following a meeting with SES executives, Tree House said, "This has reference to the press article sighting Queries on the Account receivables for the just concluded FY 2015. We wish to place on record as also for the benefit of members that the financials of Tree House Education and Accessories Limited have been audited and adopted by the board after a detailed and careful review of its true and fair position. The points raised by the proxy advisory firm is based on their understanding and is devoid of practical business realities and our revenue receipts sources. We wish to confirm that the nature of receivables is consistent with the business practice".
Tree House also put up on exchanges a copy of the addendum issued by SES. In the addendum, SES said Tree House's Rajesh Bhatia, Managing Director and Sanjay H. Shah, Chief Financial Officer, Chief of Compliance and Head - Investor Relations visited its office on Monday to clarify the issue related to 'Receivables'. After the meeting, Tree House also sent two emails clarifying the above issue.
"In the communications, Tree House has given bifurcation of their debtor's business wise and explained nature of contracts that they have under their K12 school management. SES is of the opinion that Tree House has explained the high debtors and explanation appears to be satisfactory. SES has advised the Company that if shareholders are given enough information there would be no issues," the proxy firm said.
The addendum added that, "SES wishes to clarify that the same is based on written communication from the company. The company may get the same certified by their Auditors and make proper disclosure to shareholders through stock exchanges."
