The Perwaja Steel Sdn Bhd was launched in 1982 and stared as a joint venture between the government-owned Heavy Industries Corporation (HICOM) and Nippon Steel Corporation in Japan (Perwaja Steel Sandal, 2009). Perwaja Steel Sdn Bhd built a steel plant in Terengganu to supply the domestic needs for steel products and which plant was costing about RM1 billion. But after that, Perwaja started to face production problems and also was encumbered with huge debt. In 1986, Perwaja was suffering from great losses of RM131million due to management problem and appreciation of Japanese yen (Webmaster, 2015). Eventually, in 1987 Nippon Steel pulled out of the project and decided to quit the cooperation between with Perwaja. Then, Tun Dato Seri Dr Mahathir
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Interestingly, the report from the company’s external auditor, Coopers and Lybrand had been “unqualified” until the company became bankrupted. The clean audit report on the company's financial position had been presented to the BOD and was approved during the annual general meeting. Although the probe into the RM 2.9billion losses started in 1996, no one had been implicated until 2004 when Eric Chia was arrested.
Second, Perwaja’s corporate governance was lack of segregation of authorization and also misconduct of directorship. Eric suggested for the formation of a tendering committee (TC) comprising of himself as the chairman together with the other two directors which he know well of them. The BOD unanimously approved the procedure for the purchases and awards of contracts as directed by the MOF and proposed by the tendering committee. Zaina further reported that the BOD also resolved that Eric be allowed to conclude purchases and contracts without referring to the tendering committee for consumable goods like electrodes, scrap, iron ore, lubricants, and contracts of RM5 million and below. There was tend to make most decisions at own
Interestingly, the report from the company’s external auditor, Coopers and Lybrand had been “unqualified” until the company became bankrupted. The clean audit report on the company's financial position had been presented to the BOD and was approved during the annual general meeting. Although the probe into the RM 2.9billion losses started in 1996, no one had been implicated until 2004 when Eric Chia was arrested.
Second, Perwaja’s corporate governance was lack of segregation of authorization and also misconduct of directorship. Eric suggested for the formation of a tendering committee (TC) comprising of himself as the chairman together with the other two directors which he know well of them. The BOD unanimously approved the procedure for the purchases and awards of contracts as directed by the MOF and proposed by the tendering committee. Zaina further reported that the BOD also resolved that Eric be allowed to conclude purchases and contracts without referring to the tendering committee for consumable goods like electrodes, scrap, iron ore, lubricants, and contracts of RM5 million and below. There was tend to make most decisions at own