Allegations that the Selangor government had used “creative accounting” to look good in the Auditor-General’s Report are “irresponsible and completely untrue”, said Menteri Besar Abdul Khalid Ibrahim.

NONE He told a press conference at the state secretariat building today that its financial statements are prepared in accordance with the National Accountancy Department’s standards, which in turn are based on the International Public Sector Accounting Standards - Financial Reporting Under the Cash Basis Accounting.

In addition, he pointed out that even the 2011 Auditor-General’s Report says that the state’s financial statements give an accurate picture of its financial position.

“The Selangor government constantly reminds its civil servants to practice transparency and responsibility when performing their duties and to be prudent in approving expenditure,” he said.

Khalid, who is also the Ijok assemblyperson, said that this is amongst the reasons why the auditor-general had classified the state’s financial position as “good”.

PKNS assets not sold

Several BN backbenchers yesterday claimed that several Pakatan Rakyat-administered states including Selangor had transferred funds from state trust accounts into consolidated accounts and pass it off as revenue to make themselves look good .

However, Khalid responded that this belittles the ability of the auditor-general and his staff, whom he said had prepared their report professionally.

NONE Separately, he denied that Agriculture Minister Noh Omar’s claim that Selangor State Development Corporation (PKNS) is selling off RM321 million worth of assets, and said it was merely transferred to a subsidiary.

“One lesson this minister could learn is that when dealing with a subsidiary’s accounts, one way to show the true accounts of a company or government is through consolidation...

“Consolidated accounts do not take account of transactions between (sister) companies because it is considered to be a transaction that is within the same company.

“That means that if people ask if the assets were sold, the answer is ‘no’.” he said.

He added that he would direct PKNS’ general manager and finance department deputy general manager to explain how this accounting was done to the public.

Good for awareness

When asked how he felt about people who are untrained in accountancy commenting on such issues, Khalid said this is a positive development because it highlights any lack of understanding, and then help the people of Selangor understand it.

He said when he was working with Permodalan Nasional Bhd (PNB), he worked to teach bumiputras to invest, and it would be helpful in making good investment decisions if they could understand account books.

“It seems that my efforts over 15 long years did not reach the minister level. I fear that when ministers take over companies, they could not make sound decisions because they could not read accounts,” he added.

Khalid was also asked to comment on calls from three PKR parliamentarians to spend the state’s RM2.2 billion reserves, such as for increasing allocations for city councils and road maintenance.

He told reporters that this would be discussed at the State Legislative Assembly when its budget is tabled on Nov 19 “based on the state government’s capability”.

In addition, he said he wanted every allocation handed out would be to meet a specific target, and open tenders would continue because it was found to result in 25 to 30 percent savings, which can then be used to fund other programs.

The latter statement is apparently in response to Petaling Jaya Selatan MP Hee Loy Sian’s objection to awarding contracts to the lowest bidder.

"Many contractors that offer the lowest price, in the end, are not able to carry out their work,” he said in parliament yesterday.