How should we judge a government?

In Malaysia, if you don't watch television or read newspapers, you are uninformed; but if you do, you are misinformed!

"If you're not careful, the newspapers will have you hating the people who are being oppressed, and loving the people who are doing the oppressing." - Malcolm X

Never argue with stupid people, they will drag you down to their level and then beat you with experience - Mark Twain
Never argue with an idiot, otherwise people won't know which one of you is the idiot.
Since light travels faster than sound, some people appears bright - until you hear them speak.

Why we should be against censorship in a court of law: Publicity is the very soul of justice … it keeps the judge himself, while trying, under trial. - Jeremy Bentham

"Our government is like a baby's alimentary canal, with a happy appetite at one end and no responsibility at the other. " - Ronald Reagan


Government fed by the people

Government fed by the people

Career options

Career options
I suggest government... because nobody has ever been caught.

Corruption so prevalent it affects English language?

Corruption so prevalent it affects English language?

When there's too much dirt...

When there's too much dirt...
We need better tools... to cover up mega corruptions.

Prevent bullying now!

Prevent bullying now!
If you're not going to speak up, how is the world supposed to know you exist? “Orang boleh pandai setinggi langit, tapi selama ia tidak menulis, ia akan hilang di dalam masyarakat dan dari sejarah.” - Ananta Prameodya Toer (Your intellect may soar to the sky but if you do not write, you will be lost from society and to history.)

Monday, May 25, 2015

Understanding the role of the external auditors

'The argument that because 1MDB's accounts have been signed off by auditors meant that no fraud has occurred and that money was not missing is flawed. It shows that these people do not know what they are talking about.

They have badly misinterpreted, deliberately or otherwise, the role of external auditors and they do not understand the meaning of an auditor's report when the auditors sign off the financial statement of a company.

There are no auditors in this world who will agree that their signing off on an account can in any way or form be interpreted to mean that they confirm or guarantee that the accounts are completely true, accurate and do not contain any misstatements, by fraud or error.'

- See more at: http://www.themalaysianinsider.com/malaysia/article/why-auditors-cannot-guarantee-there-was-no-fraud-at-1mdb#sthash.AvPRQz8A.dpuf

'According to The Edge, EY withdrew from the audit because it was unable to get a satisfactory explanation and gain access to information on the joint venture, particularly the US$700 million loan.

When KPMG completed the audits, it was found that the status of US$1.2 billion had changed from equity capital to a loan to PetroSaudi Holdings in the form of Islamic Murabaha notes, which guaranteed an 8.7% annual return.

Citing accountants, The Edge said the equity capital was changed to a loan so that 1MDB’s auditor need not scrutinise how the money was used.'

'If it had remained as equity capital, KPMG would have insisted on seeing evidence of the money, how it was used and why the US$700 million debt was charged to the joint venture.

But as a loan to an external party, it only required a copy of the loan agreement with PetroSaudi Holdings.'

'2010/2011

After the joint venture fell through, 1MDB lent PetroSaudi Holdings another US$500 million in 2010, and another US$300 million in May, 2011, for reasons it has never disclosed.

The total 1MDB had lent to PetroSaudi Holdings was now US$2 billion – money which 1MDB itself had borrowed at a high cost.

This prompted The Edge to question 1MDB’s actions, given that its mandate was never to act as a lender of cash.'

“One can only surmise that it became a lender in order for its audited accounts for FY March 31, 2010, 2011 and 2012 to be approved without qualification, and without having to show to KPMG that it was in control of the money,” said The Edge.

'Meanwhile, the audited accounts for the financial year of 2013 were delayed by a year because KPMG declined to continue as auditors and was eventually replaced by Deloitte.

Deloitte promptly qualified all of 1MDB’s RM13.9 billion of “investments held for sale”, including its shares in the Caymans, as Level 3, the lowest of three levels of assets in the fair value accounting hierarchy.

The Edge said 1MDB was awarded that level because there was no openly and transparently obtainable verification of the fair value of the assets.'

“What can be surmised from the events of the last five years is that 1MDB kept entering into deftly structured transactions timed to avoid vigorous scrutiny by its external auditors about the money,” The Edge said.

“And although it claims to have made gains of US$488 million from the original sum of US1.8 billion, it is not wrong for us to ask it if is just a case of being paper-rich, but cash-poor – that is, are the figures mere accounting entries not fully backed by cash or liquid assets?” – March 1, 2015.




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