The R1,3-billion arms deal subcontract awarded to a company in which Durban businessman Schabir Shaik's company held an interest is set to come under the spotlight in his trial.

Shaik has pleaded not guilty to two charges of corruption and one of fraud.

In the next few days, KPMG forensic auditor Johan van der Walt is poised to reveal more of his 250-page report into the goings-on at Shaik's Nkobi group of companies. The highlights will include:

The combat-suite contract awarded to a consortium in which Nkobi Holdings held an interest.
More details of Nkobi's cashflow problems.
A detailed account of the payments made to or on behalf of Deputy President Jacob Zuma.
A detailed analysis of Zuma's financial position.
An analysis of Shaik's financial position.

On Thursday and Friday, Van der Walt said auditors had found a number of unsigned letters on Nkobi Holdings' computers containing a number of statements, for which no proof could be found.

These included references to Shaik's links with the African National Congress, and statements that his company held the majority shareholding in an arms company.

Van der Walt also said Shaik had made it clear in his correspondence that he believed he could influence government tender procedures.

State witnesses and letters discovered by the Scorpions suggest that what Shaik said his company had to offer was "political connectivity". Van der Walt also said there was a link between the first payment made to Zuma and his first efforts to help Nkobi Holdings.

Initial plans jotted down in a notebook in 1994 seem to indicate that shares in the Nkobi group of companies would be allocated to Zuma.

It was found that Zuma had been in financial trouble since January 1995.

Shaik presented himself as Zuma's financial adviser, but only paid Zuma's debts.

Zuma's financial position did not improve.

Van der Walt said Shaik and Nkobi paid R1,2-million to Zuma between 1995 and September 2002. "We understand that this practice continued after September 2002."

The trial before Mr Justice Hilary Squires was due to continue on Monday.

With acknowledgements to Estelle Ellis and The Star.