1. Aljunied-Hougang Town Council (“AHTC”) submitted to the Housing and Development Board (“HDB”) on 15 April 2016 the first monthly progress report issued by KPMG to AHTC. This report was issued in accordance with the Court of Appeal judgment in Attorney-General v AHPETC (Civil Appeal No. 114 of 2015) (the “Judgment”).
2. AHTC has decided to make this report accessible in full (click here for the full report).
3. To recap, on 1 Mar 2016, AHTC appointed KPMG LLP (“KPMG”) to comply with the orders in the Judgment. KPMG’s terms of reference for the engagement with AHTC were derived from:
4. KPMG’s terms of reference are as follows:
5. The Judgment requires KPMG’s monthly report to address the outstanding non-compliances (“Audit Points”), the steps that must be taken to remedy such Audit Points (the “Remediation Plans”) and the progress of AHTC in implementing the said Remediation Plans.
6. Since its engagement, KPMG has reviewed the relevant audit reports and identified the Audit Points thematically. These are as follows:
7. KPMG’s first report assessed that some root causes are fundamental to several of the Audit Points; and/or present systemic difficulties for AHTC in effectively and/or efficiently discharging its obligations under the Town Councils Act. These relate to the following areas:
8. KPMG made recommendations to AHTC to address these root causes. To this end, AHTC discussed interim Remediation Plans with KPMG and agreed to implement a policy management process, a governance and internal control framework, guidelines for Finance Department staff, and an accounting manual, with target completion in July 2016. AHTC has also informed KPMG of remediation plans to address Finance Department capabilities and install a new Accounting System.
9. AHTC has been progressively implementing remedial measures to address the 17 Audit Points. KPMG considers two Audit Points to be resolved by the remedial measures undertaken by AHTC. KPMG also reports that AHTC has implemented remedial measures for 12 Audit Points and has made recommendations on further measures to be taken. Three Points are considered “open”, where AHTC has informed KPMG of its remedial measures and KPMG has not yet commenced reviewing and testing these measures. KPMG will report progress on the remaining 15 Audit Points in its next monthly report.
10. As of 15 Apr 2016, and in accordance with the Judgment, AHTC has instructed its bankers to transfer $9,134,374.06 to its Sinking Fund bank account. In effecting this transfer, AHTC has fulfilled all of its outstanding Sinking Fund transfer obligations under the Judgment (up to 27 November 2015) and thereafter (up to 15 April 2016).
ALJUNIED-HOUGANG TOWN COUNCIL
16 April 2016