AG’s report reveals 24 subsidiaries under five key federal agencies recorded consecutive losses from 2022-2024, totalling RM466.57 million last year.
KUALA LUMPUR: Twenty-four government-owned subsidiary companies have been flagged for recording losses for three consecutive years. The finding is detailed in the Auditor-General’s Report 1/2026 released today.
The loss-making entities are under five major federal agencies. These are the Employees Provident Fund (EPF), the Federal Land Development Authority (FELDA), Retirement Fund (Incorporated) (KWAP), Lembaga Tabung Haji (LTH) and the Armed Forces Fund Board (LTAT).
In 2024 alone, these 24 subsidiaries recorded total losses amounting to RM466.57 million. The report stated that ten were operating domestically while fourteen were operating overseas.
The reported losses accounted for impairment or write-downs and interest payments to parent agencies. This was in accordance with applicable accounting standards.
Conversely, the audit found 80 subsidiary companies paid dividends totalling RM2.634 billion to 30 federal agencies in 2024. Notably, nine of these subsidiaries paid RM0.936 billion in dividends despite themselves recording losses.
Audit analysis showed 45 subsidiary companies paid the highest dividends to five federal agencies. This amounted to RM2.539 billion.
As of December 31, 2024, loans and amounts owed to 46 federal agencies from 118 subsidiaries totalled RM15.322 billion. This comprised RM2.841 billion in loans to 15 companies and RM12.481 billion in receivables from 103 others.
Overall, 105 federal agencies recorded a current surplus after tax and zakat of RM87.213 billion in 2024. Meanwhile, 38 agencies recorded a current deficit totalling RM1.248 billion.
The report attributed surpluses to income from core activities, government grants, and investment returns. Deficits were linked to declining revenue, higher operating costs, and investment impairments.
It recommended intensifying efforts to boost revenue generation for agencies. This would ensure they can operate sustainably and meet loan commitments without continuous government support.
Ministries were also urged to review the direction of chronically loss-making subsidiaries. The report further advised assessing and considering the closure of subsidiaries dormant for over five years.
The Sun Malaysia
