A forensic accountant called in to investigate the business dealings between Brian Mulroney and Karlheinz Schreiber testified Wednesday that there's a "strong inference" the money alleged to have been paid to the former prime minister came from Airbus funds.

Steven Whitla, an accountant with Navigant Consulting, said the account known as Britan, which Schreiber has claimed he used to pay Mulroney $300,000 in cash payments, was funded by a Frankfurt account.

In regard to the source of funds for the Frankfurt account, Whitla said: "Our analysis of the facts support a strong inference that the original source of monies withdrawn by Mr. Schreiber from the 'Britan' account came in large part from funds received from Airbus."

Karlheinz Schreiber has claimed he paid former prime minister Brian Mulroney from the 'Britan' account. (CBC)

But lead inquiry counsel Richard Wolson stressed at the beginning of the testimony in Ottawa that there is no evidence that Mulroney knew the source of those funds. He also said there was no evidence that any payments made were for anything other than the Bear Head project — a plan for a light-armoured vehicle plant in Nova Scotia.

Schreiber has said he gave Mulroney $300,000 to lobby on behalf of the Bear Head project.

But Mulroney has said he was paid $225,000 in three instalments, and that the money was payment for his efforts as an international lobbyist on behalf of the German company Thyssen.

Whitla also cautioned that while there's evidence showing three withdrawals from the Britan account in the amount of $100,000 from 1993 to 1994, there's no documentation that proves that specific money went to Mulroney.

He also agreed that the only proof that Mulroney received the three $100,000 cash payments comes from Schreiber's testimony.

"We don't know if those funds actually were the funds — if any funds — were received by Mr. Mulroney," he said.

The inquiry has for the most part steered away from the dealings around a 1988 Airbus contract to supply Air Canada with 34 A320 planes for $1.8 billion.

Schreiber's company IAL had signed a contract with Airbus Industrie whereby IAL received commissions of up to three per cent for every plane sold to Canada.

Mulroney later received a $2.1 million settlement after he sued for defamation when his name was publicly mentioned in connection with a 1995 investigation into the sale of the Airbus jets to Air Canada.

Traced to U.S. account

Whitla said they were able to trace the Airbus payments to a U.S. account in New York, based on a German prosecutor's report which outlines on a yearly basis the funds that went into that account in connection with Airbus.

From that, he said, a reasonable inference can be made that around $1.4 million was then transferred to the Frankfurt account.

The audit revealed that on July 12, 1993, the Britan account was set up and that two weeks later, $500,000 was transferred from the Frankfurt account to the Britan account.

"The only source of funds into the Britan account was the Frankfurt account," Whitla added.

Whitla said the audit was hampered because the accountants had limited access to banking documents.

He also pointed out that the audit could not identify the recipient of millions of dollars of cash and that there were a number of instances where amounts were transferred to other accounts in which the ultimate recipients are unknown.

Forensic accountant Steven Whitla presented this chart outlining the flow of cash into the Britan account. (Navigant Consulting)