PAC wants former 1MDB CEO probed
The bipartisan committee probing into 1MDB concluded that the affairs at the fund were “unsatisfactory.”
The report also said the board of directors had failed to carry out its responsibility, and had not been proactive in reviewing the management’s activity and the company’s cash flow.
“Better monitoring was needed by the board of directors to question the buying of assets and debt cost,” it stated.
After months of reviewing the 1MDB reports from Malaysian agencies, the members of the PAC said Shahrol Azral should take full responsibility for the weaknesses and constraints.
Other recommendations are that 1MDB’s assets in TRX, Bandar Malaysia, Air Hitam and Pulau Indah should be surrendered to the Minister of Finance Incorporated so that they could be monitored and managed well.
The report also recommended that the Advisory Board be abolished.
The report found many flaws in 1MDB’s model structure, including that best practises were not implemented.
“After looking through the final reports by the Auditor-General’s Department and PAC proceedings, we have found that the management and the board of directors were weak.
“The management had repeatedly not complied with decisions and orders made by the board of directors or the management took its own decisions before going through it with the board of directors,” said the PAC report.
The 106-page PAC report, tabled in the Dewan Rakyat today, blamed poor management and a heavy reliance on loans as the main reasons for its problems.
The loans started in 2009 with an injection of RM5b before being raised to RM42b, compared with the assets of RM51b at the end of March 31, 2014. The committee found 1MDB had spent RM2.4b to pay interest on its loan.
“In January 2016, their debt stood at RM50b, compared to their assets valued at RM53b, where 1MDB had spent RM3.3b to pay off the loan interest between April 1, 2013 and March 31, 2015,” said the report.
It added: “It is clear that the debt level and repayment of interest was too high compared to the cash flow of the company.”
It said the debts were incurred due to, among others, 1MDB’s over reliance on the refinancing exercise to pay off its matured debts – by taking new loans to pay off the interests on previous loans.
Mukah Pages bring you trending news media with Free Malaysia Today http://ift.tt/1UXWh4B
Post a Comment