Wednesday, October 21, 2009

Tourism board making losses

THE Malaysian Tourism Promotion Board has not turned in a single ringgit of profit despite making investments of RM41.9mil since its inception in January 1976.

The Auditor-General’s Report revealed that the ministry’s subsidiary Pembangunan Pelancongan Nasional Sdn Bhd (Pempena) had not done due diligence before making its investments.

The report also found that seven subsidiary and 17 associated companies under Pempena suffered cumulative losses of RM32.37mil until Dec 31 last year.

Six of the seven companies recorded a RM3.74mil loss in 2007. Only one company, Malaysian Travel Business Sdn Bhd, made a profit of RM438,240 in 2007 after taxes.

According to the report, Pempena would record RM40.03mil in overall losses from its investments and initial capital outlay of RM52.86mil for the 24 entities.

“Pempena has made investments in subsidiary companies that are not viable because it has not done due diligence as a whole before making the investments,” the report said. It added that Pempena’s investments in its seven subsidiary companies and 17 associated companies were not presented and discussed with the board prior to approval.

“Pempena only informed the board after the investments were made,” it said.

The board in reply said it would report to the Finance or Tourism Ministry to withdraw the Government’s investments from subsidiaries that failed to declare dividends for three consecutive years.

The report also found that the board neglected to set up a committee responsible for valuing and monitoring its investments in the companies.

In its response, the board said it would form investment committees on “project basis” if its subsidiaries decided to make new investments.

“The audit also found that the board did not have any long-term and short-term strategic plans for the entire organisation,” it said.

In reply, the Board said it held a Strategic Planning and Direction workshop from Oct 16 to 18 as per the recommendations of the Auditor-General.

In response to the Auditor-General’s Report, Tourism Minister Datuk Seri Dr Ng Yen Yen said yesterday that the ministry had a special committee looking into the losses incurred by the Malaysian Tourism Promotion Board,

She said the ministry was aware of all the issues, and was almost at the end to its investigation into the losses.



Source : STAR
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