The Prime Minister, Datuk Seri Najib Abdul Razak announced that he was extremely pleased that 1MDB RM5 billion fund has returned a net profit of RM425 million for its first financial year ending March 2010.
While we are pleased to that the fund has managed to generate a “return” of 8.5%, the “profit” only gives us a piece of the puzzle. Any accountant worth his salt will tell you that evaluating the performance of a company based purely on a “profit” figure without footnotes, details and context is as good buying a pretty looking car, without evaluating its engines.
For the past 2 consecutive parliamentary sessions in March and June this year, I have submitted questions to the Prime Minister to obtain an update on the investments and performance of 1MDB, including its financial performance such as assets, liabilities etc.
“Tony Pua meminta Perdana Menteri menyatakan prestasi dan kedudukan syarikat 1Malaysia Development Berhad (1MDB) sejak ianya ditubuh, termasuklah pelaburan yang telah dibuat, dan nilai 'current assets', 'return on equity' dan 'total assets'.”However, in both circumstances, my question wasn't given a proper answer on the pretext that 1MDB has only been set up and the performance and financial data are not ready.
I have once again submitted a similar question on 1MDB for the current session commencing next week and the Prime Minister has no excuse but to release the full details of the investment performance of 1MDB since he has willingly teased us with the profit made by the fund.
For example, Malaysians will be interested to know if the profits of 1MDB is derived from its various investments made to date, or is it purely a profit arising from the injection of assets into 1MDB by the Government. For example, it has been reported in The Star on May 19th that the Government will be transferring the prized land in Sungai Besi, currently the base for the Royal Malaysian Air Force to 1MDB and that this will “basically be a left hand, right hand transfer”.
This means that 1MDB would have gotten this piece of land for “free” from the Government. The question then is, did 1MDB regard the receipt of this piece of land in its accounts as “earnings”, and if so, how much is this piece of land valued at? Hypothetically, if it was valued at RM1 billion, then without this “grant” from the Government, 1MDB would have then made a loss of RM575 million and not a profit.
There is no way for us to know if the above or other hypothetical scenarios are accurate or otherwise, unless the Prime Minister walks the talk about the results “underscoring 1MDB's corporate governance” and make public the full accounts of 1MDB. If Najib is indeed pleased with 1MDB's performance, then there should be absolutely nothing to hide.
In fact, the Prime Minister should not have to wait for the turn for my question to be raised, which could be more than a month away, but immediately make available the full accounts and annual report of 1MDB to be downloaded from the 1MDB website, or at the very least, be available on our respective seats in Parliament when the new session starts on Monday.
As the English idiom goes, “if you've got it, flaunt it”. Don't just tease us with a RM425 million profit, show us the real thing.