1MDB To Be Liquidated, Issues For Auditors
This was sent to me by Ganesh Sahathevan.
Parker Randall are the new auditors for 1MDB, according to Treasury secretary-general Irwan Serigar Abdullah. He said this when asked if 1MDB had appointed a new auditor at a press conference on the government’s 1Malaysia People’s Aid (BR1M) here today. He revealed that Parker Randall were already in the midst of auditing some of the subsidiaries of 1MDB. Asked when the auditor’s report would be released, he replied “Its ongoing. We wait for the report.” "
It is quite likely that the audit will be a relatively simple liquidation audit, where assets will probably be reported at the amount of the expected cash proceeds from liquidation, and liabilities reported without assuming that the debts will be forgiven. The IPIC affair and the other issues that brought 1MDB to a position where it is to be liquidated may be glossed over.
In reporting assets the auditor will have no choice but to consult with the US DOJ with regards the assets seized by the DOJ which it says were acquired with 1 MDB funds. Ignoring the seized assets can land Parker Randall into all sorts of problems, with all sorts of people, including the bondholders and possibly the US DOJ.
This complicates somewhat the Malaysian Government's current stance, that the DOJ action does not concern it or 1MDB.
My comments : This new auditor (the fourth auditor to be appointed?) cannot rubber stamp the audit even if they wanted to. But there is a catch here. The new auditor will only handle the subsidiaries of 1MDB. They will not be auditing 1MDB itself. The US DOJ has mentioned 1MDB.
So there maybe a break in the link here.
So who will actually do the liquidation audit of 1MDB? Well first of all 1MDB has been transferred back to the MOF. The MOF has the power to do anything they want. All the obligations of 1MDB have been transferred back to us.
Once it is liquidated, 1MDB ceases to exist.