‘Losses too big for Other Reserve account’

PUTRAJAYA: Bank Negara Malaysia’s (BNM) foreign exchange (forex) losses of the 1990s had to be classified as “deferred expenditures” in its annual financial report as it was getting too big for the Other Reserve accounts to handle.

“Forex losses or gains were typically charged to the Other Reserve account, but in 1993, the losses was getting too big and it could no longer be done and was classified as ‘deferred expenditures’,” said former BNM accounts manager Saleha Lajim yesterday.

Saleha, 69, said she could not remember the amount of the loss, as it happened too long ago, but that it was too big to be charged to the Other Reserve accounts.

She also said then deputy governor Tan Sri Lee See Yan had verbally asked her to make some modifications to the 1993 financial reports, of which her department prepared a draft for.

Saleha said the modifications consisted of putting the losses in either the Investment Fluctuation Reserve account and/or the Exchange Rate Fluctuation Reserve account, instead of the Other Reserve account.

“I do remember that we presented the draft to then BNM governor Tan Sri Jaafar Hussein by way of his adviser, who was Tan Sri Nor Mohamed Yakcop. The draft was approved and was kept by the Accounts Department.”

Malaysian Institute of Accountants member K. Puspanathan, who is also an RCI panelist, asked why didn’t Saleha, in her capacity as accounts manager, raise the alarm when all this was taking place. Saleha replied that she was just doing as she was told.