Original audit report would have been tabled to PAC if no meeting on Feb 24 - Arul Kanda

KUALA LUMPUR - The High Court today heard that the original 1Malaysia Development Berhad (1MDB) audit report bearing the "09" watermark would have been sent to the Public Accounts Committee (PAC) if the Feb 24, 2016 meeting did not take place.

Former chief executive officer of 1MDB Arul Kanda Kandasamy, 46, said he had received a telephone call from the then Prime Minister Datuk Seri Najib Razak, a day before the meeting, telling him to attend the said meeting.

Previously, former Auditor-General Tan Sri Ambrin Buang had testified that the initial 1MDB special audit report bearing the "09" watermark had already been completed by Feb 24, 2016 and would have been submitted to the PAC, if not for requests for amendments made by Najib.

Asked by senior deputy public prosecutor Datuk Seri Gopal Sri Ram, Arul Kanda said there were a number of reasons given by Najib on why he needed to attend the meeting.

"Among them to defend the interest of the company, and regarding the scope of the audit of National Audit Department (NAD) verifying the accounts of 1MDB. He has some concerns that the content of the report could be spun from a political perspective," said Arul Kanda.

Questioned by Sri Ram whether Najib's telephone call influenced him when he attended the meeting, Arul Kanda said what he got from the call was that Najib was concerned the 1MDB audit report may be "spun politically".

Sri Ram: Spun to whose detriment?

Arul Kanda: To my understanding, it was to the detriment of Datuk Seri Najib.

Sri Ram: We have had evidence from witnesses from the NAD whereby, if not for the 24th meeting, the 1MDB audit report Watermark 09 (original copy of the audit report) would have gone to the PAC. Do you agree?

Arul Kanda: Yes

Previously, the court heard that a government auditor, namely Nor Salwani Muhammad, had saved one last copy of the audit report's draft that was within the NAD custody, despite being told to destroy all copies of the reports.

Meanwhile, another witness, namely former Auditor-General Tan Sri Dr Madinah Mohamad, had testified that she decided not to destroy the original copy which was given to her by Nor Salwani, as it contained material evidence on the sovereign wealth fund.

She added that following the change of government from the BN to the Pakatan Harapan administration in 2018, she handed copies of the watermark "09" 1MDB audit report to the then Council of Eminent Persons (CEP), the police and the Malaysian-Anti Corruption Commission (MACC).

This copy became one of the central pieces of evidence used by the prosecution in the audit report case against Najib and Arul Kanda.

When cross-examined by Najib's lawyer Tan Sri Muhammad Shafee Abdullah today, Arul Kanda said during the audit process he himself had faced a lot of difficulties like getting the documents from the management of 1MDB.

Muhammad Shafee: Did you brief the matter to Datuk Seri Najib?

Arul Kanda: That time, I didn't have any specific issue that I could highlight or point out whether in terms of fraud or mismanagement. But I have general concern and that concern was triggered by articles and news reports. I felt that further investigation was required, and in fact, I suggested to Datuk Seri to bring in an independent third party, in this case, the Jabatan Audit Negara to conduct a review.

Muhammad Shafee: What was the PM's (Najib's) reaction?

Arul Kanda: When we had the discussion, he said he would take it into consideration; he didn't say yes or no. Within a week or two, there was an announcement made by NAD asking us to verify the accounts of 1MDB.

Arul Kanda was testifying as a prosecution witness in the trial of Najib for alleged tampering of the 1MDB final audit report, after the court allowed the prosecution's application to call him as a witness.

Najib is charged with using his position to order amendments to the 1MDB final audit report before it was presented to the Public Accounts Committee to avoid any action being taken against him, while Arul Kanda is charged with abetting Najib in making the amendments to the report, to protect Najib from being subjected to action.

Arul Kanda remains a co-accused.

The trial before Judge Mohamed Zaini Mazlan continues on July 4. - BERNAMA