Tabung Haji Act amendments to introduce tougher financial reporting rules, penalties

KUALA LUMPUR, Aug 11 — The Malaysian government plans to amend the Tabung Haji (TH) Act 1995 to introduce stricter financial reporting rules and penalties, following the recommendations of the Royal Commission of Inquiry (RCI). Finance Minister Zulkifli Hasan stated that these amendments aim to rectify the issues identified by the RCI during its investigation of TH's management and operations from 2014 to 2020.

The proposed amendments will incorporate prescribed accounting standards and penalties for financial misreporting, as suggested by the RCI. A task force, led by TH's chairman and comprising Bank Negara Malaysia (BNM) Governor and Securities Commission (SC) Chairman, has been convened to review the matter. The task force has recommended that TH's fund management and investment activities be overseen by the SC, while the haj management remains under the supervision of the Prime Minister's Department for Religious Affairs.

Zulkifli Hasan also announced that TH has adopted a more moderate bonus policy tied to the institution's overall financial performance and key performance indicators, subject to approval by the religious affairs and finance ministers. The government body has implemented profit distribution rates based on audited annual financial statements since 2022, aligning with the RCI's call for clearer provisions for calculating TH's profit distributions. TH's financial statements have been compliant with the relevant accounting standards since 2018.

Furthermore, the RCI recommended a complete overhaul of the TH Act 1995, including the establishment of eligibility criteria for board members based on expertise and integrity, as well as a ban on active politicians serving as TH's chairperson or board members. The government body has already implemented leadership appointments based on the 'fit and proper' criteria aligned with BNM's framework.

Zulkifli Hasan expressed confidence in TH's position regarding haj management, investments, financial operations, and overall performance.