1MDB to appoint auditor 'soon'

KUALA LUMPUR: Treasury secretary-general Tan Sri Irwan Serigar Abdullah said 1Malaysia Development Bhd (1MDB) is yet to appoint an auditor, and that its arbitration case with International Petroleum Investment Company (IPIC) is still ongoing.
“We are going to appoint an auditor soon,” he told reporters on the sidelines of Malaysia Venture Capital Management Bhd’s (Mavcap) signing ceremony yesterday.
Irwan, who chairs 1MDB’s board, was responding to questions about the status of the state-owned fund’s financial statement for the year ended March 31, 2015, which was supposed to be submitted by Sept 30, 2016 after two extensions.
He declined to comment on other questions related to 1MDB, saying only that there is no outcome yet on the arbitration case between 1MDB and IPIC. “We are still waiting. Let us see what happens.”
At an earlier event, Irwan refuted a report by Financial Times that China will help 1MDB in repayments to IPIC.
Mavcap yesterday signed two memorandums of understanding with venture capital firms Gobi Partners from China and Elixir Capital from the US for the establishment of the Asean Growth Fund and Global Islamic Economy Fund respectively.
The Asean Growth Fund targets up to US$200 million and focuses on growth and later-stage financing for innovation and technology-related growth stage companies in Malaysia and Southeast Asia.
The Global Islamic Economy Fund targets up to US$250 million. It aims to nurture and support the Islamic innovative funding ecosystem, in partnership with Affinis Labs of the US.
“We believe these two new funds will enable us to leverage on untapped opportunities to accelerate the development of the VC industry, both in Asean and in Islamic markets,” said Mavcap CEO Jamaludin Bujang.
“This will also create greater prospects for promising Malaysian start-ups, as funds such as these will help foster innovation and ultimately contribute towards cultivating a vibrant and dynamic VC ecosystem in Malaysia, and further elevate Malaysia’s position in the regional funding ecosystem,” he said.
As a start, Mavcap is aiming for US$50 million to US$60 million per fund by June 2017, Jamaludin said, adding that each fund could invest in 10 to 25 companies.
Commenting on the VC industry, he said Mavcap and the Securities Commission (SC) are looking at ways to increase Malaysia’s profile in the VC space.
“It’s about changing policy, it’s about support from the private sector as well. Many things were discussed yesterday at the SC. Hopefully, this will be brought forward to the government for changes to be made,” he added.
Jamaludin said issues discussed with the SC include tax incentives for corporates to invest in VC funds, changing perception on taking risks in investing in start-up companies and the Goods and Services Tax, which is imposed on initial fees for fund managers who set up here.
“I think they (SC) will submit their findings to the authorities by the end of the first quarter. Hopefully, they will take up the recommendations made and make changes to the industry,” he added.