All town councils have unqualified financial statements for FY2018

All town councils have unqualified financial statements for FY2018

hdb residential blocks Singapore skyline - file photo
General view of HDB residential blocks (File photo: Jeremy Long)

SINGAPORE: All 16 town councils had unqualified financial statements for the 2018 financial year, the Ministry of National Development (MND) said in a press release on Thursday (Dec 5).

The ministry also released its Town Council Management Report for the financial year, which saw two town councils score an "amber" rating for corporate governance.

The town councils are assessed annually under five indicators using three colour bands – green, amber and red. 

READ: MND remains concerned over AHTC financial affairs, could take regulatory action

For corporate governance, a “green” rating means that there was full compliance with the checklist for the indicators; "amber” means there is one item of non-compliance or one observation from the auditor; "red" is the worst rating, with at least one item of non-compliance and one observation from the auditor, or two or more items in either category.

Table: Summary of Town Councils' performance for FY2018
(Image: Ministry of National Development)

Broadly, the results of the 2018 Town Council Management Report are comparable with that of previous years, with improvements observed in estate maintenance, said MND.

Holland-Bukit Panjang Town Council and Jurong-Clementi Town Council scored "amber" for corporate governance, due to one count each of non-compliance with the Town Councils Act and the Town Councils Financial Rules.

The amber rating for Holland-Bukit Panjang Town Council was related to the collection of charges for the use of outdoor display areas by third-party retailers.

This went beyond the provisions of the Town Councils (Use of Common Property) Rules, which require these areas to be confined to incidental use by existing businesses, said MND.

Jurong-Clementi Town Council's rating was due to quotations under the Town Councils Financial Rules.

The rules allow quotations of up to S$3,000 to be obtained verbally and approved, and then circulated to the town council for information.

While Jurong-Clementi Town Council had obtained approval from the appropriate authority for these quotations, it had not circulated them as required by the financial rules, said MND.

In response to queries by CNA, Jurong-Clementi Town Council said that since September 2019, it has taken "steps to ensure that all the approved quotations are circulated at town council meetings". External auditors had noted no town council funds were lost or misused, it said in its press release.

The ministry also singled out Aljunied-Hougang Town Council (AHTC) for mention, noting that it had achieved a green banding for corporate governance, an improvement from its previous amber rating for the previous financial year.

"This was due in large part to the efforts of KPMG (the accountants appointed by AHTC pursuant to a court order in 2015), which assisted AHTC in its remediation of past control failures and audit points over a period of 24 months," said MND. 

"HDB had provided funding for this work done by KPMG."

Separately, MND also voiced concerns over Ms Sylvia Lim and Mr Low Thia Kiang's continued involvement in the financial affairs of AHTC.

IMPROVEMENT IN ESTATE MAINTENANCE

The 2018 financial year was the first for which town councils were assessed under revised performance standards for estate cleanliness and estate maintenance.

As a whole, the town councils' performance in estate maintenance improved as compared to the previous year.

The category assesses town maintenance in areas such as damaged pipes or walls and obstructions in common areas.

Three town councils - AHTC, Jurong-Clementi Town Council and Tampines Town Council - scored an amber rating for this category, with the rest scoring green.

This means the three town councils had a minimum of four and fewer than eight counts of "maintenance observations" per block on average.

The previous financial year, five town councils scored an amber rating.

In response to CNA's queries, Jurong-Clementi Town Council said most maintenance observations were to do with items placed by residents along common corridors and small fixtures put up by them.

The town council said it has been working to advise residents not to put items along common corridors or install unauthorised fixtures. 

For estate cleanliness, only AHTC failed to score a green rating and was given an amber rating.

All 16 town councils scored green ratings for lift performance and S&CC arrears management.

REVISION OF LIFT PERFORMANCE INDICATOR

From the 2020 financial year, the lift performance indicator will be revised to consider the frequency and duration of lift faults, said MND.

At the moment, lift performance is assessed by measuring the frequency of lift breakdowns and the functioning of the Automatic Rescue Device, which brings the lift to the nearest landing during a power failure.

The new method of assessment will take into account the frequency of faults as measured by a tele-monitoring system as well as the duration of lift downtime experienced by residents due to these faults.

"This will serve as a more direct measure of the experience of residents in using their lifts," said the ministry.

The remaining indicators are being reviewed progressively.

The ministry has presented the audited financial statements of all town councils to Parliament, and the town councils will also be making them available on their websites.

Source: CNA/nc

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