ganesh

Wednesday, May 20, 2015

Malaysia's Ministry of Finance admits Delloites 1 MDB audit is in error.: Delloites "true and Fair " opinion proven to be invalid

As reported by Malaysiakini:

The Finance Ministry(Malaysia) has corrected its parliamentary written reply in March that said the US$1.1 billion (RM3.97 billion) transferred by 1Malaysia Development Bhd (1MDB) from Cayman Islands to Singapore was in cash.

According to the latest written reply to Petaling Jaya Utara MP Tony Pua, the Finance Ministry said the money that was "redeemed" was in the form of assets in US dollars.
http://www.malaysiakini.com/news/298963


The problem for the Malaysian Ministry for Finance and indeed the Government is that the admission and consequent contradiction  ,regardless of the motives ,means that the  Delloites audit  of  the 1 MDB financial statements for at least the year ended 31 March  2014 is probably worthless. The audit was quite likely based on that sum of US$1.1 billion (RM3.97 billion) being cash, not anything else.
It is a material amount, so any admission that it is not in cash throws considerable doubt on the audit opinion, that the 1 MDB  financial statements provide a "true and fair view" of 1 MDB's financial position. 
END



Wednesday, April 22, 2015

Confirmation : 1 MDB transaction generated no cash

by Ganesh Sahathevan


Sarawak Report has just reported   that 1 MDB  banker   "BSI Bank has dismissed documents supplied by 1MDB relating to its Brazen Sky Limited account in Singapore, saying they are false bank statements........ there is no actual cash in the relevant Brazen Sky Limited account."


This confirms the conclusion reached by this writer in an earlier posting about 1 MDB and its financial affairs,titled: 

1 MDB audit: AG must & will find that loss of RM 7 billion in cash was in accordance with proper procedures,accepted accounting practise


In that article 1 MDB's audited 2013 financial statements were presented ,and it was concluded that the transactions 1 MDB's management and directors strenuously  asserted had generated about two billion US dollars in cash, which they said  was eventually placed under 1 MDB subsidiary Brazen Sky Ltd,were  " nothing more than a series of book entries" which 

generated no cash.

In that article it was shown how,despite 1 MDB 

management's assertions, the audited  financial 

statements actually showed that no cash was generated.

The Sarawak Report story seems to have confirmed the 

conclusion.

END 

Sunday, March 29, 2015

Is KPMG being "Enroned"?-Similarities to the Tricontinental matter in Australia

The following is an excerpt from a report by Roger Trapp in The Independent , Wednesday 26 January 1994



THE ACCOUNTANCY firm KPMG Peat Marwick is to pay the Victoria state government Adollars 136m (pounds 63.6m) to settle a court case arising from the collapse of the merchant bank Tricontinental Group.

The Tricontinental case stemmed from KPMG Australia's audit of the accounts of the bank, which collapsed in 1990 with a shareholders' funds deficit of AUD 2.6bn.

At the time the bank was owned by the state government of Victoria , but it was sold to the Commonwealth Bank of Australia after the collapse.

KPMG Australia 's executive chairman, John Harkness, agreed that the deal was the only practical solution to a very difficult situation. 'The sheer enormity of this case made the prospect of pursuing justice through the usual legal channels totally impractical,' he said.


In a sense, Tricontinental  Merchant Bank was to the State Bank Of Victoria what 1 MDB is to the Malaysian Government and taxpayer;an organisation left in the hands of a young "go getter" with little experience but regardless entrusted with the management of billions of dollars of borrowed money, KPMG's  Melbourne partners  handled the audit exclusively, saving the international partners financial embarrassment. However, as the 1 MDB story below illustrates, the Global Partnership would be hard pressed to distance themselves from the Malaysian partners.

Saturday, March 28, 2015

Is KPMG International being "EnRoned"? : Fallout from Malaysia's 1 MDB scandal may cost KPMG USD 10 billion



A new verb, "Enron-ed" was coined by John M. Cunningham, the former Arthur Andersen Director in the Seattle Office, to describe the demise of Arthur Andersen.



KPMG International ,the Swiss Cooperative under which KPMG partnerships worldwide come together to offer audit and other services under the direction of a Global Executive Leadership Team,  has found itself entangled in Malaysia's 1 MDB sovereign wealth fund scandal. 

It appears that in managing the crisis it now faces, KPMG may be managing its 1 MDB documents in a manner similar to  Arthur Andersen and its  documents related to the  Enron assignment which led to the effective demise of that firm which was once considered the gold standard in auditing. 

The Sarawak Report website that has in recent weeks published 1 MDB emails that reveal gross financial impropriety,  recently published email correspondence between 1 MDB and its former auditor, the KPMG partnership in Malaysia,where KPMG has been shown to provide directions  on how 1 MDB's books should be 
re- presented in order to receive an unqualified audit opinion. 

1 MDB is now unable to repay its loans worth USD 10 billion and counting, and it is likely that the company will be liquidated, with its debts assumed by the Malaysian Government which has effectively guaranteed 1 MDB's borrowing.

KPMG International has been queried about its potential liability for the possible if not probable  civil and criminal claims arising from the 1 MDB scandal, and its general counsel Tom Whetered has insisted that the Cooperative offers no client services and has nothing to do with 1 MDB.

However that is a denial based on form for everything in substance says otherwise. To begin with, KPMG International counts as its revenue fees from the Malaysian partnership,and that will include fees from the 1 MDB assignment. In fact its  recently retired chairman , Michael Andrews,  identified Malaysia as a target market for growth when he took on that role.

Then the Singapore managing partner Sai Choy Tham, who is also a member of KPMG International's Global Executive Team , is also Regional Head of Audit, South East Asia.  Mr Tham has been queried about his communication with the KL office with regards the 1 MDB emails revealed by Sarawak Report,and has been asked specifically if communications in the past weeks has included directions about the management of 1 MDB documents. He has refused to confirm or deny that he has issued  directions in that regard, in his capacity as Regional Head Of Audit and member of the KPMG Global Executive Team.
The queries put to Mr Tham were also put to KPMG International chairman John Veihmeyer, who has also chosen to remain silent.

Meanwhile ,KPMG's  partners in Malaysia have , in response to the Sarawak Report expose, insisted that all they have done they have done in accordance with international accounting standards.
Each of the Big 4 has its own auditing procedures that are considered proprietary, and in insisting that the 1 MDB audit was executed in accordance with international standards the partners in Malaysia are really saying that they have acted in accordance with KPMG International's established norms and procedures. 
Put in another way, the Malaysian partners are insisting that they have acted  as directed by KPMG International, even as KPMG International seeks to distance itself from them.
END 

Friday, March 20, 2015

Bombadier announced its $2-3 billion CS100 deal knowing the deal is and remains unfunded

Bombadier Inc , a company listed on the Canadian Stock Exchange, presumably in the interest of keeping the market fully informed, announced on  17 March 2015:
Bombardier Commercial Aircraft and Fly Mojo Sdn Bhd announced today that the parties have signed a Letter of Intent (LOI) for the sale and purchase of 20 CS100 aircraft with options for an additional 20 CS100 aircraft.Based on the list price of the CS100 aircraft, a firm order would be valued at approximately $1.47 billion US, and could increase to $2.94 billion US, should flymojo exercise all its options.

Flymojo is , in relative terms, nothing more than a shell, with a paid-up capital of only USD 1.million, and nothing else. When asked about its funding for the deal the company first claimed to be backed by private equity, but then under interrogation said:
"flymojo is working alongside Bombardier and third parties to source potential financing solutions."
It appears then that Bombadier has made its announcement knowing that the deal is unfunded. It might as well have announced that it was buying Airbus and Boeing all at once. Bombadier and Flymojo initially gave the impression that Flymojo's private equity backers would fund the deal. However, when it was put to company spokeswoman Tan Wai Fun that the size of the deal would require an injection of capital that would in essence swamp the interest of existing shareholders to next to nothing, Ms Tan responded:

I checked, and noted my mistake in the response to the question on aircraft funding.
My apologies for that - the correct response is:
"flymojo is working alongside Bombardier and third parties to source potential financing solutions."
In fact,Ms Tan made no mistake. Managing director, Datuk Janardhanan Gopala Krishnan, told Malaysia's Sun Daily that the company is backed by private equity funds,"   and   "will look into sale and leaseback of aircraft of its fleet in a bid to keep the company asset light." 


It is clear from the differing accounts from the company's CEO and its spokeswoman that the deal is unfunded, and that Bombardier is aware of the fact. Announcing a deal of the given magnitude knowing it is yet to be funded, with a client that is little more than a shell, must cause Canadian regulators some concern.END 

Tuesday, March 10, 2015

Brandis & Sherburn will place the CVE programme above law enforcement: Which one of them will bear greater responsibility when they fail?

The following excerpt is from Australian Public Service's Gazette.It describes what the newly formed Countering Violent Extremism (CVE) Section will do:

Working with community and government partners, we emphasise intervening early – addressing violent extremism before a law enforcement response is required. This critical, internationally recognised work is complex, exciting and rewarding.

The CVE Section is headed by one Anna Sherburn.As her profile suggests, her background is in  human rights (and marketing ,media liaison). Her background is likely to  ensure that intelligence on individuals who are the subject of intervention  will not be conveyed to law enforcement.To do so would contradict her objective.


Regardless, it is more likely than not that the CVE will fail (ask the Malaysians,Indonesians etc etc) and that the general public will suffer the consequences .When that happens, Ms Sherburn, and her Minister, one George Brandis, ought to be held responsible, and not allowed to hide behind public service secrecy.

END 




Anna SherburnAnna Sherburn Profile Picture

Director, Countering Violent Extremism Unit, Attorney-General’s Department

Anna Sherburn is the Director of the Countering Violent Extremism Unit in the Attorney-General’s Department. In this role, she is responsible for coordinating the Australian Government’s approach to countering violent extremism, which involves working with Government, non-government and community partners to enhance Australia’s community cohesion, community engagement and education, address online radicalisation and propaganda and efforts to intervene and divert individuals who are already radicalising to violent extremism to turn them away from ideologies of hatred and violence. Anna’s previous roles been in a variety of fields including human rights and anti-discrimination, media liaison and marketing.
An example of Ms Sherburn's work:

 UNDERSTANDING THE RADICALISATION PROCESS

It is important to understand what the radicalisation process looks like, in order for families, friends and communities to help prevent acts of violent extremism.

The radicalisation process

There is no single pathway of radicalisation towards violent extremism, as the process is unique to each person. However, there are some common elements in the experiences of most people who have become radicalised in Australia, regardless of their beliefs or motivations.
These elements include significant behavioural changes in major areas of a person's life including ideology, social relations and criminal activity. If someone is radicalising towards violent extremism, changes can often occur in all three of these areas.
A person's behaviour must also become more intense and extreme over time, when compared with that person's previous or 'normal' behaviour. Their circumstances and environment should also be taken into account.
Increasing religious devoutness or commitment to unconventional beliefs is not the same as radicalisation towards violent extremism.
If there is a valid alternative explanation for the changes in behaviour, these changes should not be considered a sign of radicalisation.
If a person radicalises to the point of promoting, threatening or using violence for an extremist cause, the Australian Government and the wider community have a responsibility to act.

Identifying radicalisation

Most individuals begin the radicalisation process in one of three key areas—ideology, social relations or criminal activity. This normally means that a person's behaviour will noticeably change in one area first, and not across all three areas at the same time, but change in these areas can happen very quickly.
Most people do not go all the way to becoming a violent extremist. Something or someone might interrupt the radicalisation process, and the person does not get to the point of threatening or using violence, and may even reject their radical ideas. When this happens, it is called disengagement. The active involvement of families, friends and the community in this process is very important.
More information on understanding and identifying radicalisation to violent extremism is available in the information sheet:







The APS Advertisement 


Attorney-General
Attorney-General's Department
Closing date: Wednesday, 15 October 2014
On 31 October 2013, the Minister Assisting the Prime Minister for the Public Service, Senator the Hon. Eric Abetz,
announced interim recruiting arrangements for the Australian Public Service. As a result of these arrangements only
current ongoing APS employees are eligible to apply for this vacancy. Further information regarding the interim
arrangements is available here: target='Interim arrangements page'>http://www.apsc.gov.au/home/current-priorities/interim-arrangements.

Vacancy N.N. 10632205
National Security Law and Policy Division
National Security Policy and Capability Branch
Job Title:
Expression of Interest (APS Employees Only) - Senior Policy Officer
JobType:
Non-ongoing (Temporary), Full-time
Location:
Barton - ACT
Salary:
$95,154 - $115,778
Classifications:
Executive Level 1
Position No:
492483-EOI-NSLPD
Job Description
http://careers.pageuppeople.com/649/ci/en/#/listing/
Duties
Please quote reference number 492483-EOI-NSRPD.
To obtain a copy of the Vacancy Information Kit for this vacancy, please click on the ‘Apply Online’ button at the bottom of this
advertisement.
The Countering Violent Extremism (CVE) Section is responsible for delivering the Government’s new CVE programme. Our
vision is to reduce the risk of home grown terrorism by strengthening Australia’s resilience to radicalisation and helping individuals disengage from extremist influences and beliefs.
Working with community and government partners, we emphasise intervening early – addressing violent extremism before a law enforcement response is required. This critical, internationally recognised work is complex, exciting and rewarding.
As a Senior Policy Officer, you would be responsible for driving the development and national roll-out of an intervention
framework that is focussed on supporting individuals to deradicalise and disengage from violent ideologies by connecting them
with support services and diversion activities.

We are seeking an experienced and highly motivated officer with excellent interpersonal skills and a strong ability to drive
projects and work in a collaborative way with governments, academics and community stakeholders. Some of the tasks that
the Senior Policy Officer will be involved in include:
- securing State and Territory agreement to an implementation plan for a high profile new policy
- developing funding and performance agreements with service providers
- working with researchers and community groups on the development and roll-out of assessment tools
- engaging with communities, local institutions and families to ensure that they are well-informed and equipped to prevent
Australians from being willing to support or participate in overseas conflicts
.
Eligibility
This vacancy can only be filled through a temporary assignment of duties at the same or higher classification (not a promotion).
Notes
Non-ongoing opportunity will be offered for a specified term
This non-ongoing opportunity will be offered for a period of up to 8 months.
**Please note that this opportunity is only available to current Australian Public Service employees.**
About Attorney-General's Department
Vacancies
Australian Public Service Gazette
No. PS40 - 09 Oct 2014
Page: 3 of 110
________________________________
Page 4
The Attorney-General’s Department serves the people of Australia by working to achieve a just and secure society. The
Department provides expert advice and support to the Australian Government to maintain and improve Australia's system of
law and justice and its national security and emergency management systems as well as providing support for cultural affairs,
including movable cultural heritage and support for the arts. The Department’s work covers a broad array of policy and program
initiatives, including protecting human rights, combating organised crime, enhancing our counter-terrorism arrangements,
improving access to justice, emergency management and support for cultural heritage.
The Department is the central policy and coordinating element of the Attorney-General's portfolio, for which the Attorney-
General and Minister for the Arts; and the Minister for Justice are responsible. We encourage and value a diverse workforce
and offer a wide range of challenging and exciting career opportunities.
To find out more, visit our website at www.ag.gov.au or email HR.Assist@ag.gov.au
To Apply
Selection Documentation:
HR Assist, (02) 6141 3333, HR.Assist@ag.gov.au
Position Contact:
Anna Sherburn, (02) 6141 4107
Agency Recruitment Site:
http://www.ag.gov.au/
This notice is part of the electronic Public Service Gazette PS40 - 09 Oct 2014 Published by Australian Public Service
Commission.
Applicants to vacancies notified in all formats of the electronic Public Service Gazette should be aware that the names of
successful applicants will also be notified in all formats of the electronic Public Service Gazette

Monday, March 09, 2015

Goldman Sach's Roger Ng," leaves behind a controversial legacy with regard to 1MDB.": He should be found,and questioned by the Malaysian AG's 1MDB task force

As written  by Jonathan Green of IFR Asia:



It emerged last week that a gentleman called Roger Ng has departed from Goldman Sachs, where he had most recently headed up South-East Asian sales in the US titan’s fixed-income, currencies and commodities unit. It’s no secret that Goldman has done rather nicely from its fixed-income business in Malaysia, and Mr Ng’s connections within the country are often hailed as the root of those successes. There’s no doubt, however, that he leaves behind a controversial legacy with regard to 1MDB.


It is hard to see how, when even the Malaysian Prime Minister Najib is being investigated with regards the 1 MDB scandal, Mr Ng is not. He needs to be found and interrogated. 
The US Government ought to cooperate in the matter, if it is in fact serious about fighting corruption.