TH hid losses to look profitable before GE14, says Rafizi
Mohamad Fadli
-December 4, 2018 8:13 AM FMT
PKR’s Rafizi Ramli, who made previous exposes on Lembaga Tabung Haji.PETALING JAYA: PKR’s Rafizi Ramli claims that Lembaga Tabung Haji (TH) changed its own rules in order to hide losses in TH Heavy Engineering (THHE), which would have affected the group’s profits.
Speaking to FMT, Rafizi, citing the second series of the 2017 Auditor-General’s (A-G) Report released yesterday, said hiding the losses had affected the percentage of profits which could be declared to the public.
“It seems it was to ensure that TH continued to look profitable, so it could declare higher profits months before the 14th general election,” he said, noting that the declaration was made in January.
“If the profits were low and THHE’s losses were recorded, it would confirm my previous expose.”
He said this was probably why TH had changed its own rules but that the A-G had since uncovered and reported the matter.
The report revealed that TH failed to record an asset impairment of RM227.81 million in three subsidiary companies and three associate companies, especially its investment in associate company THHE amounting to RM164.58 million.
The A-G added that TH’s policy on reporting the impairment of assets was inconsistent. The policy was changed every year while, in the financial year ending Dec 31, 2017, it was even changed twice.
“I have exposed TH’s financial projections since 2016 which highlight its losses, especially in THHE,” Rafizi said.
He added that TH’s financial decisions must take into account the profits and losses of its investments, including in its subsidiaries. He said this would ultimately determine TH’s profitability at a group level.
“This, in turn, will determine the dividends which can be announced because legally, TH’s rules do not allow it to announce dividends higher than its profits.”
However, Rafizi declined to comment on TH’s previous denials, saying only that it was his responsibility to raise such issues.
He said the government and management of TH now bore the responsibility of restoring the confidence of depositors by being transparent and auditing all of TH’s operations, to erase any doubts over the pilgrims’ fund board.
