Town council had lapses in records management, accounting system

SINGAPORE — Its independent auditor was unable to issue an opinion on its FY2011/12 financial statements, as the town council was unable to find accounting documents to support figures for April to July 2011.

And the town council did not record lift upgrading programme expenses in the financial statements for the years in which the expenses were incurred. As a result, there were understatements of about S$240,000 and S$8.14 million in FY2010/11 and FY2011/12, respectively. There was also overstatement of S$8.38 million in FY2012/13.

These were among the lapses by the Aljunied-Hougang-Punggol East Town Council (AHPETC) in terms of records management and its accounting system, highlighted in the Auditor-General’s report on the town council’s accounts.

Other lapses found by the Auditor-General’s Office (AGO) included the lack of due diligence in monitoring amounts due and amounts received from external parties. This meant that sometimes, accounts were not updated and accounts due were overstated. The AGO found that the amounts due could be overstated by about S$1.73 million for FY 2012/13.

AHPETC also did not reconcile the tax provisions for income tax and the actual tax levied by the authorities. It also did not reconcile the provisions for Goods and Services Tax (GST) against the returns submitted to the authorities. As a result, the tax provisions in the accounting records could be understated by S$495,367 for FY2012/13, the AGO said.

In its response to the AGO, AHPETC noted that with regard to the lift upgrading programme expenses, bills were carried over from FY11 to FY12 so the town council could check and seek clarification. It added that it implemented a module in its IT system from April 2012 to enable the timely recording of expenses.