The most amusing charade in the corporate sector here is the chairman's statement that normally accompanies the release of the year/quarter financial resultS. One of them is the recent release of Tenaga Nasional's quarterly result and the apparent explanation by the company on the reasons for the dramatic drop in its earnings.

I found the comments attributed to the Tenaga chairman interesting. The yen dominated loan is only 10.5 percent of the total debt of Tenaga standing at RM31.3 billion. The total exchange differences and deferred taxation amounted to RM535.7 million. This still does not explain how a profit of RM663 in the previous quarter has become a loss of RM26.4 million, a reversal of nearly RM689.6 million.

A closer examination of the announced numbers indicates that in the previous quarter there was an exchange gain of RM293.5 as compared to an exchange loss of RM382.7 million this quarter. To me this is the main reason for the drastic reversal in Tenaga's fortune. There was also a deferred tax charge in the previous quarter amounting to RM114.7 so there is not much movement there. To cite that shows a lack of understanding of accounts.

Tenaga needs to explain the reason for the great distortion in the exchange gains and losses charges. If I recall correctly, the exchange rates have not moved that greatly in the opposite direction in the last quarter.