Najib: LGE does not understand that Govt uses a different accounting system

PETALING JAYA: Former Minister of Finance Najib Razak said his successor Lim Guan Eng does not understand that the government uses a different accounting system than that of the private sector.

In a Facebook function, the former Prime Minister responded yesterday to Lim's allegations that the previous administration had registered RM14.56 billion of unreclaimed taxes as income, which ultimately resulted in a shortage of money for the Tax Refunds Trust Fund.

Lim said that this was considered "forgery of accounts".

Najib said the government used the adjusted cash system and not the accruals accounting standard used in the private sector.

In the modified cash accounting system, all financial transactions are calculated and posted when cash has been deposited and recorded for the financial reporting period.

"Under this standard, non-capitalized assets and liabilities are not included in the financial report."

That, said Najib, was the reason why Lim came to the "incorrect conclusion" that the previous Barisan national administration had incorrectly reported misreported unreported taxes and accused of forging the accounts.

"Just like the confusion about the comma, the misunderstanding between the accounting systems is an easy mistake that is usually made by everyone."

However, Najib noted that during the government's transformation initiative during his government, the government was moving towards a standard for accounting accounting.

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