[Flashback] Indonesia is no stranger to accounting scams


Posted by Latha Do NADARAJAN , Year 3 undergrad at the School of Accountancy, Singapore Management University

In the wake of accounting scandals in the U.S., an accounting expert here warned on Wednesday that Indonesia was no stranger to such scams. In fact, many book-cooking cases have occurred in the past, and even worse scams could happen in the future unless the government takes action to curb such practices.

Tight regulations and stiff sentences are needed to prevent such scams in Indonesia, Professor Wahyudi Prakarsa from the University of Indonesia said.

“”The scams take place in U.S., which has sound financial institutions and regulations. Indonesia, as a developing country, might have had and would have worse cases, despite the fact they have yet to become a subject of public debate,”” he told The Jakarta Post. Continue reading


[Flashback] Penny Stock Debacle: Too Little Too Late For SGX


Posted by Latha Do NADARAJAN , Year 3 undergrad at the School of Accountancy, Singapore Management University

Minerals, Oil and Gas bubble?

Media report has it that Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX), are conducting an “extensive review” of the securities trading activities of three penny minerals, oil and gas (MOG) stocks – Blumont Group, Asiasons Capital and LionGold Corp. There are believed to have some common shareholdings, overlapping directorship/management and their business orientation centers on mining sectors. All have asserted their operations and financials remain sound. What befuddles me, market observers and punters alike is why their share prices spiked to astronomical heights this year, arguably, way out of alignment to their fundamentals or at least to trend seen in their global peers. Were the stocks cornered and manipulated to unsustainable heights before allowing them to crash in the first week of October? I have no clue. This is a matter for MAS/SGX’s “extensive review” to discover, if there is. Continue reading

[Flashback] Indian oil industry embroiled in corporate espionage probe


Posted by Katharine TAN Pei Shi, Year 4 undergrad at the School of Accountancy, Singapore Management University

A major controversy is brewing in India after allegations surfaced that confidential documents were sold by bureaucrats in India’s Ministry of Petroleum and Natural Gas to industry insiders.

Reliance Industries, one of the country’s largest companies, is among firms that have come under the spotlight in what insiders admit is a well-known practice. Indian police have arrested senior executives from top energy firms including Reliance Industries along with consultants and staff at the powerful oil ministry in connection with the scam. Continue reading

PWC’s statement after its resignation as Labixiaoxin’s auditor

Posted by Lin Liye, Year 4 undergrad at the School of Economics, Singapore Management University

In March 2014, there was a CCTV report related to the supply of toxic gelatine by certain enterprises in food production, of which one of the enterprises named was a supplier to Labixiaoxin.

With respect to this update, PWC wanted to hire an independent advisor selected by PWC to investigate the allegations. However, Labixiaoxin had already hired an “independent advisor” on their own and had already “reported their findings to the company”. When PWC pursued the matter further and wanted to see the results and findings, Labixiaoxin used the argument that they could not agree with the audit fees payable to PWC to terminate the auditor relationship as below. Continue reading

[Flashback] SC asks RBI to probe fresh fraud by Sahara company


Posted by Katharine TAN Pei Shi, Year 4 undergrad at the School of Accountancy, Singapore Management University

Unable to cough up Rs 10,000 crore to secure the release of its chief Subrata Roy since March 4 last year, the troubled Sahara group on Tuesday faced fresh setbacks in the Supreme Court which ordered Roy to be taken back to jail from the conference room inside Tihar and asked RBI to probe an alleged Rs 500 crore financial fraud by group company Sahara India Financial Corporation (SIFCL).

Appearing for RBI, senior advocate Parag Tripathi said the court had on June 14 last year relaxed its earlier freeze order on alienation of bonds, securities and fixed deposits to enable the group to sell these financial instruments and raise bail bond money to get Roy and two directors out of jail. Tripathi alleged that in the garb of the SC order, the Sahara group company liquidated its securities, bonds and fixed deposits, which were secured against repayment to investors and depositors, but diverted nearly Rs 500 crore to its sister concern Sahara India. However, only a little over Rs 3 crore was paid to investors and the company maintains that there are no claimants for Rs 1,000 crore deposits, he said. Continue reading

[Flashback] Watchdog Raises Red Flags on Ginnie Mae Financial Statements


Posted by John SOH Yong Ye, Year 4 undergrad at the School of Economics, Singapore Management University

A government watchdog Friday raised red flags about a top federal loan backer’s financial statements.

A report by the inspector general for the U.S. Department of Housing and Urban Development said that it couldn’t sign off on financial statements made by Ginnie Mae, a government agency that securitizes federally insured mortgages.

The inspector general said that Ginnie made accounting errors in its financial statements for the year ended September 30, 2014. The report also said that Ginnie didn’t provide enough information for the inspector general to evaluate Ginnie’s treatment of $6.6 billion in loan assets. Continue reading