This article first appeared in The Edge Financial Daily on November 22, 2019

KUALA LUMPUR: A government auditor told the High Court yesterday former 1Malaysia Development Bhd (IMDB) chief executive officer Arul Kanda Kandasamy had called for an investigation over the existence of two different versions of 1MDB’s 2014 financial statement.

Nor Salwani Muhammad, a director at the National Audit Department (NAD), testified that Arul Kanda said during at an exit conference on Dec 16, 2015 that he wanted a police report lodged to facilitate the investigation.

“There is a recording of the exit conference and the minutes of the meeting for our internal consumption,” she said in reply to questions by Arul Kanda’s lawyer Datuk N Sivananthan.

She explained that exit conferences are held between the NAD and the auditing company to get an explanation over questions or discrepancy that are raised and that the meetings are held at the department.

The explanations would be included in the final audit report.

The NAD was asked to do an audit on 1MDB by the Public Accounts Committee as this was agreed to by the cabinet in February 2015.

Nor Salwani said the Dec 16, 2015 meeting was attended by Arul Kanda and 1MDB’s former director Terence Geh.

She said she could not remember if any representatives from the finance ministry were present at the meeting.

Sivananthan: Did my client said in the exit conference that a report should be lodged over the two 1MDB audit reports (for 2014)?

Nor Salwani: Yes, he had asked for a report to be lodged.

Sivananthan: This was during the Dec 16, 2015 exit meeting?

Nor Salwani: Yes correct on Dec 16.

Sivananthan: Were recordings made of the meeting?

Nor Salwani: Yes but it could have been deleted after the minutes were made.

Sivananthan: So this should be reflected in the Dec 16, 2015 minutes unlike the one held on Feb 24, where no minutes were recorded?

Nor Salwani: Yes, but the minutes are for our internal consumption or reference.

Sivananthan: Did you supply the minutes to the investigating officer?

Nor Salwani: Yes.

Sivananthan: Were you shown the exit conference minutes by the investigating officer?

Nor Salwani: No.

Sivananthan said his defence team was not provided with the Dec 16, 2015 minutes and asked that they be given a copy of the document.

Nor Salwani said she was uncertain whether a recording of the exit conference was given to the investigating officer and said she would look into it.

She agreed that Arul Kanda gave the NAD 250 pages of documents in relation to 1MDB, but noted that they were some 350 pages of documents in the final audit report.

Nor Salwani said the additional documents were in relation to 1MDB’s former subsidiary, SRC International Sdn Bhd, where a separate exit conference was held.

SRC was initially a subsidiary of 1MDB.

However, following a second RM2 billion loan in 2012, the company was placed directly under Minister of Finance Inc.