Australia’s largest non-bank corporate lender, Metrics Credit Partners, announced plans to review its governance processes following a dispute with auditor KPMG concerning asset valuations. The disagreement led to significant writedowns on the firm’s Australian Securities Exchange (ASX)-listed funds and delayed the reopening of its unlisted funds.

Metrics, which manages three ASX-listed funds alongside more than two dozen unlisted funds, had its listed funds suspended after KPMG initially refused to sign off on its accounts. These suspensions were lifted on Monday following the eventual filing of audited accounts. However, the unlisted funds remain closed to applications and redemptions as audits are still underway.

Chief Executive Andrew Lockhart addressed investors on Wednesday, expressing disappointment over the writedowns but emphasizing that the adjustments were unrealized and that the firm has a “plan and a path to recover and restore value” for investors. He stated that Metrics is focused on protecting investor capital and generating returns.

Lockhart was unable to provide a definite timeline for when the unlisted funds would reopen but expressed hope that audits would be completed within weeks and before an October 31 deadline. He noted that the ongoing audit process includes a review of fees—such as trustee, management, performance, and fund administration fees—and whether any remediation might be required should issues be identified with transactions between July 1 and September 30.

Regarding the discrepancies in asset valuations between KPMG and Metrics’ own valuers, Lockhart maintained confidence in the firm’s governance processes, describing them as “stringent and disciplined.” Nevertheless, he acknowledged the need for a thorough governance review to identify and address any potential weaknesses to prevent a recurrence.

Lockhart also denied allegations that officers of the Australian Securities & Investments Commission (ASIC) had been embedded within Metrics’ offices, calling such claims untrue.

The audit conflict comes amid increased regulatory scrutiny of Australia’s private credit sector. The Australian Prudential Regulation Authority (APRA) recently warned of heightened risks within the country’s $4.5 trillion retirement savings system linked to private credit exposures. APRA is actively reviewing superannuation trustees’ involvement in the sector to assess potential vulnerabilities.

Separately, ASIC is conducting a second round of surveillance on the private credit industry, which is understood to include Metrics. This follows a similar review conducted a year ago, with findings from the current surveillance expected to be released in the coming weeks.

In the wake of the lifted suspensions, the three listed funds saw positive trading activity, with the Metrics Income Opportunities Trust and the $2 billion Metrics Master Income Trust rising by 4.6 percent and 3.9 percent respectively, while the Metrics Real Estate Multi-Strategy Fund increased by 0.32 percent.