KUALA LUMPUR (Oct 5): The auditor general has cleared the federal government's financial statements for 2025, issuing an unmodified opinion with "other matters" paragraphs. 

An unmodified opinion indicates that the financial statements were prepared fairly and in accordance with accounting standards, with no significant misstatements.

The federal government's fiscal deficit narrowed 4.9% in 2025 to RM75.3 billion, or 3.7% of gross domestic product, according to the Auditor General's report on Monday.

Federal Government revenue rose by RM11.451 billion to RM336.069 billion, up from RM324.618 billion in 2024. 

Operating expenditure for 2025 amounted to RM330.776 billion, producing revenue surplus of RM5.293 billion. The surplus grew by RM2.184 billion compared with RM3.109 billion in 2024.

The growth rate of federal debt over the five-year period from 2021 to 2025 also slowed to 5.9% from 10.2%.

New federal borrowing fell 8.2% to RM185.577 billion in 2025 from RM202.248 billion a year earlier.

Of the new borrowings, RM106.144 billion was used to repay maturing principal, while RM75.560 billion was transferred to the Development Fund for development projects.

Nevertheless, the audit identified several weaknesses in the management of government receivables and development projects.

The audit found RM68.81 million in outstanding contractor advances for 24 projects, of which RM59.63 million, or 86.7%, had been overdue for more than 10 years.

For utility relocation costs, outstanding receivables stood at RM90.50 million as at Dec 31, 2025, with RM84.05 million, or 92.8%, outstanding for more than 12 months.

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