Thursday 28 Mar 2024
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KUALA LUMPUR (March 5): The Democratic Action Party Malaysia (DAP) has asked international audit firm KPMG to declare its role in the "Petrosaudi scandal", and if there has been omission and negligence, intentional or otherwise, in its audit of 1MDB.

Its national publicity secretary Tony Pua said in a statement today failure to do so would necessitate an investigation into the audit firm's conduct by the Malaysian Institute of Accountants (MIA) as the statutory body established under the Accountants Act, 1967 to regulate the accountancy profession in the country.

Citing latest documents disclosed by whistleblower website Sarawak Report, Pua said there appeared to be a discrepancy in the date the Murabaha Financing Agreement (MFA) was signed.

"In a 'Notice of Drawing' documents dated 23rd July and 8th September 2010, the notices referred specifically to the 'Murabaha Financing Agreement dated 14th June 2010 between 1MDB Petrosaudi Limited and 1Malaysia Development Bhd'," Pua said.

"This meant that if the Murabaha loan agreement was only signed on the 14th June, 2010 why is it that the 1MDB Financial Statements for March 2010 already claimed that the 1MDB shares in the JV has been converted into Murabaha Notes on the last day of the financial year, 31st March 2010," Pua asked.

"Further to the documents exposed, there was also an email from Patrick Mahony to the 'Project Uganda' team, which included officials from PetroSaudi and 1MDB officials, on May 2010 which discussed the various agreements involved in the transaction – the “Murabaha Loan Agreement”, the “PetroSaudi Letter of Guarantee” and the “Letter of Agreement between PetroSaudi and 1MDB”.

Pua contended, "These emails raise the suspicion that the entire share conversion exercise by 1MDB in the JV into a loan was an afterthought, well past the March 2010 financial year-end."

Financial statement has shown that 1MDB sold its 40% stakes in 1MDB Petro Saudi Ltd for US$1.2 billion (RM4.14billion) and subsequently signed the MFA with 1MDB Petro Saudi on March 31, 2010.

However, the "Notice of Drawing" documents showed that the MFA was signed on June 14, 2010, three months after the financial year ended.

Pua argued that KPMG, which audited 1MDB's account between 2010 and 2012, and signed off the audit on October 4, should have seen the content of the 1MDB's JV agreements with PSI and all the relevant material documents to arrive at its report.

"The auditors surely would have seen these documents - the fact that the agreement was only signed on June 14, 2010. In fact, the entire Murabaha discussion was after the financial year March 31.

"How is it that they can sign off an account to state that the Murabaha agreement was signed and took place on March 31?" asked Pua.

Pua charged that the whole Murabaha Note exercise was to cover the 1MDB Petro Saudi deal which saw US$700 million cash channeled to a company Good Star Ltd controlled by businessman Low Taek Jho or better known as Jho Low.

By converting to the Murabaha Notes, the JV agreement details no longer needed to be reported in the March 31, 2010 Financial report, including that US$700 million was taken out from 1MDB Petro Saudi, he charged.

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