SHAH ALAM: Yayasan Selangor's financial status is in the red and requires an injection of funds to improve its financial management and control process, says Datuk Seri Amirudin Shari.
The foundation's operational costs were also a burden and inefficient, the Selangor Mentri Besar said in his winding-up speech at the state legislative assembly sitting Thursday (July 16).
"Rental and student loans owed to the foundation from the 1990s had to be either collected or done away with," he added.
Amirudin was responding to the Opposition's protest over the proposed plan to sell off 77 assets belonging to Yayasan Selangor.
Opposition chief Rizam Ismail from Barisan Nasional had said on Wednesday (July 15) that the properties had a sentimental value and should remain with the state as opposed to being disposed of.
Amirudin also explained that Yayasan Selangor’s income was also lower than its financial liabilities.
"Income for the year 2019 was RM17.1mil in comparison to operational costs of RM27.68mil. The cost of paying wages for 172 workers was RM13.1mil, which amounted to 47% of the operational costs," Amirudin said.
He added that the fixed savings for 2019 was a mere RM7.8mil but after better and improved management processes beginning July 2019, Yayasan Selangor savings funds improved to RM11.6 mil.
Amirudin added that an effective financial plan for Yayasan Selangor’s assets was a rationalisation and restructuring plan to ensure monies to support educational funding and operational costs could be managed more efficiently.
He said the foundation’s main assets have been upgraded to rake in more income whilst assets that were more of a liability were currently being scrutinised for disposal.
“Assets that are less strategic because of high maintenance costs and low returns have to be reexamined.
“The management is in the process of relinquishing these assets to ensure operational costs are not affected.
“These include assets that are of no quality that were given by developers before 2008," said Amirudin.
He reiterated that management costs of these properties were higher than the returns received from rentals.
Amirudin said the restructuring and rationalisation plan was critically needed to allow Yayasan Selangor to continue operations given that rental collection during the movement control order had declined by 70%.
“A disposal plan of these assets will help ensure continuity of operations as well as continuance of the educational programmes that have been planned," he added.
Amirudin explained that a Yayasan Selangor strategic action plan had been presented to the organisation’s trustees in December last year and had been approved for implementation.
He said the strategic action plan included a restructuring of the organisation and its terms of reference, improving its management, standard operating procedures, corporate governance and risk and contingency management among others.
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