Technology Resources Industries Bhd (TRI) said Thursday it has lodged a police report alleging fictitious invoices worth RM259.32 million (US$68.24 million dollars) were issued in 1998 and 1999.

In a statement to the stock exchange, TRI chairman Mohd Munir Abdul Majid said the invoices would have an impact on the company's finances.

Based on the advice of the external auditors, TRI, Malaysia's second top mobile phone company, will adjust its financial statements for the affected years, he added.

Munir, a former chairman of the Securities Commission, did not provide details of the fictitious invoices.

He said the police report was made after a special board meeting on Tuesday.

No full knowledge

Munir also said new directors at TRI, nominated by Telekom Malaysia which recently gained control of the mobile phone company, did not have full knowledge of the affairs of the company and had tried to piece together information from available records in a difficult environment.

He said the new board commissioned a number of audits to ascertain the existence of proper records and documentation of the company's business and obligations.

"This was found to be necessary, not just as a matter of prudence, but to ensure full custody over and completeness of those records and documents," he added.

Munir said: "From the audits, it has also been discovered that an instruction for a transfer of funds from Celcom Malaysia Bhd (a TRI subsidiary) to the company's account amounting to RM29.96 million which was utilised for the so-called compensation payment, was given on July 1, 2002.

"The said funds were transferred on July 2, 2002 to be ready for payment before the board meeting of July 3, 2002, which had approved the said payments after taking legal advice from one firm of solicitors, not two or three."

Reward for efforts

He added the audits have, additionally, discovered a further sum of RM11.05 million was paid to three former executive directors on June 4 as a reward for their efforts for which they already have received a salary for organising the company's recapitalisation and reorganisation scheme of

"On every score, as with the police report the company is now informing the exchange about, or like the disposal of the company's assets such as motor cars to directors who are related parties, the company will vigorously protect its interests on behalf of all shareholders.

"The company will make every effort to recover assets that legitimately belong to it."

Munir also said audits on the company's records and documentation will be completed by the end of September. AFP