KUALA LUMPUR: The Public Accounts Committee (PAC) revealed today that the debt owed by 14 subsidiaries of Felcra Bhd (Felcra) has reached RM1.283 billion as of April 2022.
This disclosure marks significant financial challenges within the state-owned entity, which is wholly owned by the Ministry of Finance Inc (MOF Inc) and overseen by the Rural and Regional Development Ministry.
According to a report published on the PAC's website, two subsidiaries have been dissolved, while two inactive companies still owe the parent company RM9.75 million. The report also noted that Felcra Livestock Sdn Bhd's debt has been written off due to its inactive status, whereas Felcra Food Industries Sdn Bhd, which was reactivated in October 2022, is now undergoing debt collection processes.
"The management accounts in October 2022 recorded a debt write-off amounting to RM0.02 million for dissolved companies," the report stated.
PAC chairman Datuk Mas Ermieyati Samsudin, speaking at a press conference in parliament, attributed Felcra's substantial debt primarily to operating losses incurred by its subsidiaries. She highlighted that joint venture estate companies owed RM309.8 million, while Felcra Properties owed RM842.7 million to Felcra Bhd.
"The government also provided a RM544 million loan to Felcra for the development of the Semarak20 commercial project on Jalan Semarak, Kuala Lumpur," she added.
Mas Ermieyati referenced the Auditor General's Report 2021 Series 2, which highlighted Felcra's diversification into various sectors that failed to generate income, thereby exacerbating their financial burdens.
In response to these findings, PAC recommended that the Rural and Regional Development Ministry intensify oversight of Felcra's subsidiaries to align their operations with the organisation's original objectives.
Additionally, Mas Ermieyati emphasised the need for regular updates from Felcra and MOF Inc. on debt repayment status and strategy implementation for the Semarak20 project.
The PAC's scrutiny follows revelations in the Auditor General's Report (LKAN) 2021 Series 2, which documented Felcra's previous debt arrears amounting to RM312.22 million.
LINK: https://www.nst.com.my/news/nation/2023/02/880573/auditor-generals-repor...
As of Dec 31, 2021, Felcra still owed the federal government RM3.67 billion, as confirmed by a verification letter from the A-G's Department dated Jan 10, 2022.
TAGS: Felcra, PAC report, parliament, A-G, MOF, federal govt, NST, news, Malaysia
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