SINGAPORE: The performance of the Aljunied-Hougang Town Council (AHTC) has improved over the years, the town council said in response to lapses flagged by the Ministry of National Development (MND) in reports released on Friday (Dec 14).
"We are pleased to note that, by MND's own criteria, AHTC's performance over the recent years in the areas of S&CC arrears management and corporate governance has progressively improved," it said in a press release on Friday evening.
"This was achieved through the significant efforts of AHTC and its residents, despite the many challenges faced," it added.
MND released the town councils' financial statements and the town council management report for FY2017 on Friday.
The ministry highlighted that Workers' Party-run AHTC was the only town council that submitted qualified financial statements for last year and that it was the seventh straight year the town council had done so.
The town council management report also said that AHTC scored "amber" ratings for corporate governance and estate maintenance.
The 16 town councils are assessed annually under five indicators using three colour bands – green, amber and red - with green being the best and red the worst.
The town council report said of AHTC's amber rating for corporate governance: "Failure to maintain updated accounts and records of expenses due to an internal control weakness where the TC failed to record expenses incurred in a timely manner.
"This was also the reason why the auditor had qualified AHTC’s financial statements."
In response, AHTC said that MND's press release on the qualification received by the town council from its external auditor was "selective and incomplete".
"What MND omits to say on this observation, but was included by AHTC's external auditor, is that the expenses in question 'are found to have been taken up into expenses and the related payables during the financial year' and that 'there are no material misstatements found in the expenses and related payable transactions during the financial year.'," AHTC said.
"In contrast, when describing Tampines Town Council’s amber rating for corporate governance, MND chose an even-handed and balanced tone."
MND's report had said that Tampines Town Council scored an amber rating for an incorrect amount transferred from the operating fund to the sinking fund and lift replacement fund. It also added in the report that: "The TC had identified the computational error and rectified it, but it is still considered a case of non-compliance as the correct amount was not transferred within one month after the end of the quarter."
In its response on Friday, AHTC also said that while it is factually correct that this is the seventh year the town council has received qualified statements from its external auditor, MND's report gives the impression "that AHTC has stood still for seven years".
"From 13 observations flagged in 2012-13, AHTC has received just one observation this financial year," AHTC said.
"We believe MND's specific reference to seven consecutive years is deliberately calculated to lower the esteem of AHTC in the public eye."
AHTC town councillors and Workers' Party leaders have been accused of breaching their fiduciary duties in the management of the town council and are currently fighting the allegations in court.