KUALA LUMPUR: The Tabung Haji Hotel and Resort Sdn Bhd (THHR) secretary was taken to task for failing to ensure its board of directors comprised 50% independent members.
The Auditor-General's 2019 Report noted that three out of the four directors were “not independent", thus giving rise to the risk of conflict of interest.
"The company secretary did not advise the board of directors (that it should comprise 50% independent members)," said the A-G's Report, released on Monday (Aug 24).
It also noted that the THHR chairman was part of the Tabung Haji board of directors, and three of the THHR board of directors were officers serving Tabung Haji.
THHR is a subsidiary of Tabung Haji, the pilgrim’s fund.
The Auditor-General also noted that there were 38 standard operating procedures, with no evidence showing approval was obtained from the board prior to implementation.
"THHR did not formulate standard operating procedures (SOPs) pertaining to debt collection and customer satisfaction feedback," the report found.
There was also no evidence showing the board had approved THHR's five-year business plan from 2017 to 2021.
"(And) the business plan also did not include risk assessment," it added.
The Auditor-General also noted that THHR had established an audit and risk committee in 2017 but the committee had never held any meetings nor played its role since its inception.
There was also no internal auditing.
"Frequent internal auditing processes are important to ensure compliance and to reduce the risk of non-compliance pertaining to financial management and procedures," the report added.
It also pointed out that THHR's revenue dropped significantly to RM105.86mil (down 84.9%) in 2018 compared with the previous year because it did not get any dividends from its subsidiary TH Travel & Services Sdn Bhd.
It also noted that the THHR chief executive officer (CEO) post was still vacant after the acting CEO terminated his service on March 31 this year when parts of the assets and resources were transferred to UJ Property Management Sdn Bhd.
"The CEO post is important and must be filled for effective management," it said.
The report however found that THHR's finances were still stable, and that its assets could still cover short-term liabilities for three years.
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