KUALA LUMPUR — Lembaga Tabung Haji (TH) should have recorded a net loss of RM1.4 billion for the 2017 financial year instead of the RM3.4 billion profit reported in its financial statements, according to the findings of the Royal Commission of Inquiry (RCI).
The RCI report, released yesterday evening, said TH’s financial position was already in a critical state in 2017 and that the institution would have reported a loss had the Malaysian Financial Reporting Standards (MFRS) been fully applied.
The findings corroborate concerns previously raised by PricewaterhouseCoopers (PwC) in its review of TH’s financial position between 2014 and 2017, including a persistent deficit between the fund’s assets and liabilities dating back to 2014.
According to the report, PwC found that TH failed to carry out impairment assessments on investments in associated companies, financing and investments extended to subsidiaries, and fixed income instruments. It also found that TH did not comply with Financial Reporting Standard (FRS) 140 relating to declines in the fair value of investment properties.
The commission further found that TH distributed hibah for the 2017 financial year without accounting for impairment losses and declines in the value of its investments. It also recorded dividend income from subsidiaries even though the dividends had not been paid to the fund.
The report identified several factors behind TH’s financial crisis, including consistently high hibah payouts, questionable accounting practices, the Auditor-General’s lack of firmness, the expansion of TH’s vision to include becoming a pillar of the ummah’s economy, and mounting liabilities under the Haj Financial Assistance (HAFIS) programme. – July 30, 2026