Several cases of ‘non-compliance’ noted in AHTC financial statements

SINGAPORE — Not only was the Aljunied-Hougang Town Council (AHTC) late in submitting its audited financial statements for the fifth straight year, certain persistent lapses remain in the qualified opinion of its auditor, said the Ministry of National Development (MND) yesterday.

The lapses ranged from late transfers to, and inappropriate use of, the sinking fund, to lax tender processes.

In its statement, the MND said the AHTC had submitted its Financial Year (FY) 2015 audited financial statements on Feb 25 this year. This was almost six months after the submission deadline for all town councils.

However, due to “several reporting discrepancies” in the statements, the Workers’ Party-run town council wsa told to rectify them. The AHTC submitted its finalised audited statements on April 5.

The MND noted yesterday that this is the fifth consecutive year that AHTC’s financial statements “have been qualified by the town council’s external auditor”.

“This year, the auditor has issued disclaimers in the areas of the town council’s opening balances, conservancy and service fees received in advance, payables and accrued expenses, as well as staff costs.”

The auditor also found “several instances of non-compliances” with the Town Councils Act and Town Councils Financial Rules in the FY2015 financial statements. For example, AHTC failed to transfer funds into the bank account of the sinking fund — which is used by a town council for major cyclical works including lift maintenance — “in a timely manner”.

It also failed to ensure that all monies from the fund were used only for “the purposes of meeting expenses or liabilities properly attributable to the sinking fund”, the MND said.

In its invitation for quotations or tenders, AHTC failed to include a “debarment statement”, which states that no contract shall be awarded to a contractor if the latter, or any of its directors or employees, has been debarred by the Government from participating in the same or all types of contracts, the ministry added.

In a statement issued yesterday evening, AHTC chairman Pritam Singh addressed the three non-compliances highlighted by MND.

Regarding the failure to transfer sinking funds in a timely fashion, he said all outstanding sinking fund transfers “have since been made upon the receipt of the withheld government grants in April 2016”.

On the failure to ensure that all disbursements from the sinking fund are properly attributable for sinking fund purposes, Mr Singh said “the amount in question came up to S$4,161.87”.

“It was duly returned to the sinking fund on Dec 14, 2016,” he added.

“In committing the oversight, an estate staff had wrongly classified the repair of a resident’s leaking ceiling as facade repair works, the latter of which is properly attributable to the sinking fund.”

As for the failure to include a debarment statement, Mr Singh said the omission of the debarment statement was an isolated case involving one Invitation To Quote (ITQ) exercise. “For all subsequent ITQs, this requirement has been complied with,” he added.