ALJUNIED-HOUGANG TOWN COUNCIL –
STATEMENT ON TOWN COUNCIL MANAGEMENT REVIEW PUBLISHED 14 DEC 2012
The Aljunied-Hougang Town Council (AHTC) has noted the findings of the Town Council Management Review published on 14 Dec 2012.
We are pleased that MND has rated the AHTC comparably with the other Town Councils in the areas of cleanliness, maintenance and lift breakdown. This is a recognition of the efforts put in by the new management team in our first year, to ensure continuity of services to residents since the handover in August 2011.
MND has indicated, however, that AHTC has not completed its submission on Corporate Governance and was banded ‘Red’ for arrears management. We welcome the opportunity to elaborate on the circumstances surrounding these matters.
Corporate Governance – Pending
MND uses the independent auditor’s report and management letter submitted by the TC to assess the TC’s corporate governance indicator in the Town Council Management Report (TCMR).
The auditor for AHTC was appointed in May 2012 and commenced work in early June 2012. The audit took longer than expected to complete and the audited report was submitted to MND in late November 2012. We are in the midst of finalizing the Management Letter with the appointed auditor. We expect this to be a one-off incident. The following are some pertinent facts which have led to the longer-than-expected audit process.
After the GE in May 2011, the Town Council was served with a notice that the Town Council’s Computer and Financial Systems will be terminated with effect from 1 August 2011 due to material changes to the membership of the Town Council. This Computer and Financial Systems had been developed jointly by the 14 PAP Town Councils over a period of more than 15 months but was in January 2011 sold to and leased back from M/s Action Information Management Pte Ltd, a company which was dormant. This effectively meant that the AHTC had to develop its own equivalent systems, in particular the Financial System, within a 2 months’ timeframe. Given this near impossible task, the AHTC had to prioritize the development of its Financial System into phases with the front-end receipting system being fully operational by 1 August 2011 for collection of S&CC. The AHTC then moved on to upscale and develop the Financial System which was in use at the Hougang SMC while concurrently being fully operational. This recent audit thus required a reconciliation of books maintained under 2 different Financial Systems and a lot of time was spent with the auditors identifying and re-classifying accounting items in order to gel them for the audit.
In addition, due to the General Election 2011, MND required the period before 1 August 2011 to be separately audited for the handover. This audit firm was not the same audit firm appointed by AHTC to audit FY11/12. The incumbent auditor also spent much time going through and verifying the work done by the former auditors and attempting to obtain supporting documents.
Notwithstanding that there are still some items which need to be reconciled in the coming financial year, the auditors have nonetheless opinioned in the Audited Report for FY 11/12 that for August 2011 to March 2012 :-
a) the receipts, expenditure, investment of moneys and the acquisition and disposal of assets by the Town Council are, in all material aspects, in accordance with the provisions of the Act;
b) proper accounting and other records have been kept, including records of all aspects of the Town Council, whether purchased, donated or otherwise; and
c) the accounting and other records required by the Act to be kept by the Town Council have been properly kept in accordance with the provisions of the Act.
There is still work to be done in this Financial year to reconcile some of the items arising from the takeover and the initial setting up. However, we wish to assure residents and the public that with most of the setting-up issues out of the way, we will now look into enhancing our financial management processes.
S & CC Arrears
The AHTC has been vigilantly monitoring its arrears position and are aware of the need to manage the arrears to ensure healthy cash flow.
During our first year of operations, things needed to be prioritized to ensure residents’ welfare was not compromised. The circumstances concerning the need to replicate a new computing and financial system have already been explained above. Apart from giving priority to developing the new Financial System, we had to ensure that the daily services to residents were not disrupted. We are pleased that the TCMR findings confirm that we have substantially achieved this.
Moving forward, we have already put in place a Finance Committee to closely monitor the situation and have established a stringent arrears management process. Residents would be aware that AHTC has been following up with those in arrears to facilitate payment and to understand residents’ circumstances, being new to the area. The S&CC arrears will be our next priority in 2013.
ALJUNIED-HOUGANG TOWN COUNCIL
14 December 2012