The RM6.4 million in losses suffered by Kedah Corporation Bhd (KCB), is not a result of abuse of power or corruption, the Kedah menteri besar's political secretary Muhammad Sanusi Md Nor said.
Explaining the losses, Sanusi (left) said it was the result of management costs, loan management costs and the initial investment made by several of the KCB subsidiaries.
Explaining the losses, Sanusi (left) said it was the result of management costs, loan management costs and the initial investment made by several of the KCB subsidiaries.
Sanusi also touched on the RM134 million loan that KCB took from London-based Capital Investment Agency, as revealed in the Auditor-General's Report 2011.
The loan was taken to finance the acquisition of a 70 percent stake in Mas Incorporated (PNG) Ltd, which obtained a logging concession in Papua New Guinea. It was also to finance KCB activities.
"However, after the agreement was made, the loan was cancelled by the state ombudsman committee appointed by Kedah Menteri Besar Inc (KMBI) on Jan 2010, as we found that the participation there may cause a burden and risk to the company.
"Following this, the committee proposed that KCB cancel the deal with that country, as it found the situation and procedures there to be unstable," Sanusi said.
The ombudsman committee comprises the state secretary, state financial officer and the chief executive officer of KMBI.
The audit found that KCB took out the RM134 million loan for the Papua New Guinea project without the approval of its board of directors.
Sanusi in explaining further the Papua New Guinea venture, said it was cut-off halfway, resulting in it being reported that the project did not receive any returns as the capital and management costs were borne by the company.
He said the previous chief executive officer, appointed by KMBI after March 2008, had been replaced.
Problem inherited from previous BN government
Sanusi also explained that KCB had to bear the financial burden inherited from other projects as well from the previous management led by its former chief executive officer, Tajul Urus Mat Zain, who is also the Umno Merbok division chief.
Sanusi in explaining further the Papua New Guinea venture, said it was cut-off halfway, resulting in it being reported that the project did not receive any returns as the capital and management costs were borne by the company.
He said the previous chief executive officer, appointed by KMBI after March 2008, had been replaced.
Problem inherited from previous BN government
Sanusi also explained that KCB had to bear the financial burden inherited from other projects as well from the previous management led by its former chief executive officer, Tajul Urus Mat Zain, who is also the Umno Merbok division chief.
He admitted that the Kedah Pakatan Rakyat government, which he admits is still new in the field of international trade, has managed to reduce bigger risks.
“An important thing is that the Pakatan government does not intervene in the jobs entrusted to the state officers, unless they start to cause problems.
“An important thing is that the Pakatan government does not intervene in the jobs entrusted to the state officers, unless they start to cause problems.
“This is what is done by Pakatan Kedah as we do not interfere but give the powers to those appointed to head the companies or state agencies,” Sanusi added.
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