BNM Issued 5 Warnings On TH's Financial Standing - Zulkifli
KUALA LUMPUR, Aug 11 (Bernama) -- Bank Negara Malaysia (BNM) had issued five warning letters to the Tabung Haji (TH) chairman and the Minister of Religious Affairs regarding the gap between TH's assets and liabilities.
The Minister in the Prime Minister's Department (Religious Affairs), Dr Zulkifli Hasan, said that TH's management had been warned that the situation needed to be rectified immediately to ensure TH does not continue to be in violation of the law.
“At the time, TH’s position posed a potential systemic risk to the country’s financial stability. Unfortunately, those letters were ignored by TH’s leadership,” he said.
He said this during a ministerial briefing on the Royal Commission of Inquiry (RCI) report on TH, as well as the efforts and measures taken to restore the institution’s financial position, at a special sitting of the Dewan Rakyat today.
Zulkifli added that BNM’s warnings were followed by a reprimand from the Auditor-General in the 2017 Financial Statements Report.
He said the Auditor-General had issued an Emphasis of Matter on changes to the impairment policy, which were made twice in the same year to show higher profits for 2017.
“Following the reprimand from the authorities, TH’s new board appointed the international audit firm PricewaterhouseCoopers (PwC) in 2018 to reassess TH’s financial position and performance in accordance with valid and accurate accounting standards,” he added.
Subsequently, financial manipulation was confirmed by PwC in its report, which found that only RM556 million of the total assets of RM4.6 billion were valued by professional valuers.
On July 29, the 211-page RCI report was made public, containing various findings on weaknesses in the institution’s management and operations during the 2014-2020 period.
The report also included 25 recommendations for improvement, 75 per cent of which had been implemented by TH as of July 30.
The government announced the establishment of the RCI in 2021, followed by the appointment of its members on Jan 20, 2022. The report was subsequently presented to the Yang di-Pertuan Agong on Aug 30, 2022.
-- BERNAMA