Polysoup and rotated statics

I realized that polysoup collision is not correct for rotated static objects. I suspect that this is because the polysoup collision mesh is not rotated along with the object, or at least not rotated the way it should be.

For small objects this is not really visible, but for larger ones like DTS cliffs this comes out pretty well.

Has anyone experienced this before? I have done some limited testing and thought I would ask around before I try to get to the bottom of it, and dive into polysoup.

Any comments are greatly appreciated.

-- Konrad