A-G report describes Finas’ accounting system as weak and unacceptable, says minister

By P PREM KUMAR & ALIFAH ZAINUDDIN / Pic By MUHD AMIN NAHARUL

The National Audit Department has expressed concerns on the financial discrepancies that are detected in the accounts of the National Film Development Corp (Finas), said Communications and Multimedia Minister Gobind Singh Deo (picture). 

He said in an audit report on Finas, Auditor-General (A-G) Tan Sri Dr Madinah Mohamad had highlighted that Finas’ financial statements did not give a true account of its financial position as at Dec 31, 2016, as well as its cashflow for the period according to the prescribed reporting standards.

“I take this A-G report seriously. The report that Finas’ financial statements were misleading is a very serious matter and completely breaks the integrity of Finas’ financial system,” he told reporters at the Parliament lobby yesterday.

He said the report described Finas’ accounting system as weak and unacceptable as there was no justification given for the movement of large sums of money.

This included income tax of RM6.21 million and RM3.25 million between 2006 and 2015, as well as failure to record income tax liabilities amounting to RM2.12 million in 2016. The report also cast doubt on a RM18.45 million deposit for a film.

“I believe this requires a review of Finas’ financial system so that this leakage will not be repeated in the future,” he said, adding that a new board of directors has been appointed to lead Finas.

“This appointed board consists of those with experience and knowledge in film, arts and accounting. I will announce this new board next week,” he said.

Film actor and producer Datuk Gerald Hans Isaac is rumoured to be the new Finas chairman. Gobind, however, declined to confirm the speculation.

He said the ministry’s select team that will carry out an internal audit on Finas will also be announced next week.

The minister said he would also appoint an accountant from a reputable company to study and report Finas’ new financial structure, and that is necessary to improve the agency’s financial system and accountability.

“Funds are an asset to the national film industry and it must be ensured that it is used and channelled to fair and equitable parties. Where there is a shortage, it has a bad impact on the industry. This must be avoided,” he said.

In June, the Malaysian Anti-Corruption Commission (MACC) had raided Finas’ headquarters in connection with several allocations Finas had received.

Gobind had urged the MACC to speed up its investigation and give its latest update on the case.

“We hope that they can speed up with the investigation as it involved an estimated RM25 million. This is a huge amount and we need to know the outcome,” he said.