Defense further established this morning that auditors knew the purpose and plans for the Xtron bonds and that Foong Daw Ching was kept in the loop.
The court heard that the team from City Harvest Church had given auditors knowledge about the purpose for which Xtron was raising funds by issuing bonds to CHC.
Among the evidence presented by Michael Khoo, senior counsel for Chew Eng Han in this morning’s cross-examination was a document sent by Tan Ye Peng to Foong Daw Ching on July 21, 2008, that states that Xtron had been sourcing for funds to continue Sun’s music career.
Khoo had produced Xtron’s board meeting minutes earlier to show that Xtron had rejected Citic Ka Wah’s loan offer because its interest of 16 percent was too high. An email from Chew to Serina Wee also said that Urban Entertainment Pte Ltd was slated to give Xtron a loan, but Foong had advised that there would have to be disclosure requirements on CHC’s part. All these considerations led the CHC team to come up with the idea of Xtron issuing bonds to CHC.
It is the prosecution’s case that CHC had misappropriated funds by investing in “sham” bonds from Xtron. The defense brought up the argument that for the Crossover Project to be successful there was a need for discretion, and thus details were only given to a small circle of people.
The defense also showed that the auditors, however, knew fully of the events leading up to the issuing of bonds and subsequent concerns that the team had concerning the bonds. Emails and documents also showed that the auditors had discussions with Tan, Wee and Chew on their concerns regarding the church’s corporate governance and Xtron bond issues.
Earlier this morning, Foong confirmed that charities could make investments for commercial returns. He also agreed to Khoo’s suggestion that charities have been known to make investments for both commercial returns and for the purpose of its vision. In this case, the proceeds would not be as important.
Foong also agreed with the defense that if Ho’s music career was “part and parcel” of the Crossover Project, even if funds were used to fund the Crossover Project, which was a mission of the church, it would be reasonable.
Senior counsel Andre Maniam, acting for Serina Wee, began his cross-examination after Khoo. He pointed out to Foong that as far back as 2002, the auditors of CHC from TFWLC Loong would include him in emails even though he was not the engagement partner for the audit at the time.
Court resumed at 2.15pm.
中文报道 – CHC审讯：审计师清楚思创债券的缘由