The Kuala Lumpur High Court has fixed Oct 26 for its decision on Deloitte PLT’s judicial review application to set aside an RM2.2 million fine against it over alleged failure to flag 1MDB-linked irregularities.
Judge Mariana Yahya set the date during proceedings late this morning.
“Oct 26 for the decision,” the judge informed the legal teams for Deloitte and the Securities Commission (SC) in court.
On Dec 13 last year, Malaysiakini reported that the international auditing firm filed the legal action to overturn the Malaysian securities regulator’s decision to impose the fine.
On Jan 30 last year, it was reported that the SC fined Deloitte a total of RM2.2 million for four breaches involving the RM2.4 billion bond (sukuk) issued by Bandar Malaysia Sdn Bhd (BMSB), a 1MDB subsidiary, in 2014.
During today's proceedings, Deloitte's counsel Malik Imtiaz Sarwar informed the court that they rely on the written submissions for the matter.
Counsel Nahendran Navaratnam acted for the SC.
Mariana then told both parties that the court needs time to go through the written submissions.
The judge then set Oct 26 for decision or clarification (if needed) over the matter.
Deloitte was the statutory auditor for BMSB and parent company 1MDB Real Estate Sdn Bhd (1MDB RE) for the fiscal years which ended on March 31, 2015, and 2016.
SC had alleged that Deloitte had committed breaches under Section 276(3)(b) of the Capital Markets and Services Act 2007 (CMSA) for failure to immediately report to the regulator about irregularities which may have had a material effect on the ability of BMSB to fulfil its obligations in repaying sukuk holders any amount under the Sukuk Murabahah Programme.
The SC further alleged that Deloitte's independent auditor's report for 1MDB RE for 2015 and 2016 had stated that the firm was unable to obtain sufficient and appropriate audit evidence to determine whether the advances to 1MDB from, among others, the proceeds of the bond could be recovered.
The regulator also alleged that the audit firm's report for both 1MDB RE and BMSB for both years also stated that "the ongoing investigations of 1MDB indicated the existence of material uncertainty which may cast significant doubt about the group's and the company's ability to continue as a going concern".
Deloitte was fined RM2 million - the maximum amount allowed by the law - for allegedly failing to perform its statutory duties on the above two matters.
The firm was fined another RM200,000 for purportedly failing to submit a copy of BMSB's financial statements to MTrustee Bhd - the trustee for the bond - within the legally stipulated time. - Mkini
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