May 27, 2007

EDB Under Scrutiny

ST May 26, 2007
Watchdog wants more regular audits
for EDB


LAPSES at the Economic Development Board (EDB), including its financial operations, have prompted a parliamentary watchdog to urge the Auditor-General (AG) to give it more regular audits.

The Public Accounts Committee, made up of eight MPs, noted that the lapses were spotted when the 46-year-old agency underwent its first audit by the AG.

The audit led to 'a large number of observations'' that the EDB had not established proper
internal control procedures, the committee said in a report presented to Parliament on Thursday.

However, the committee was 'encouraged'' by a letter it got from the EDB outlining the prompt action taken to address these lapses.

Every year, the committee pores over the financial statements of government agencies and the AG's annual report and seeks written explanations from agencies concerned. It then reports on the irregularities involving the use of public funds.

The EDB lapses involve mainly the way the agency is run and its financial operations, including its procurement and accounting systems.

The committee noted, among others, that EDB had delegated power to staff to grant loans and to borrow without reporting back to its governing board.

'Such practices were not in compliance with the law,' said the committee, which is headed by MP Cedric Foo.

More details from Reuters.

Frankly, what I find most shocking about this whole matter is not that the EDB has lapses in its "governance structure, financial operations, procurement and accounting systems" (as reported by Reuters).

The most shocking thing, to me, is that this is the first time the Auditor-General of Singapore has audited the EDB, in 46 years.

I wonder how many other government agencies or statutory boards there might be in Singapore, that the Auditor-General hasn't audited even once, in the past 5, 10, 15 or 20 years.

Who knows how many other NKFs we might discover.

What HAS the Auditor-General been doing?

57 comments:

Roger said...

Indeed, it is SHOCKING.

Forty six years without an audit? An auditor's nightmare! And forty six years without an assessment of internal controls? Simply amazing.

With the UNSW debacle still fresh, one has to wonder what process was followed when public funds were allocated.

Anonymous said...

Where's the money? Where's the money?
Sound familiar? LOL

Anonymous said...

The question is why now? There is always an agenda behind this sudden discovery. Why starts with EDB announcement and not Temasek? EDB has $100M plus unaccountable and it is BILLIONS OF DOLLARS for Temasek.

Anonymous said...

Yeah, I'll like to see someone try to audit Temasek Holdings.

admin said...

http://www.myaskblog.info

http://www.xtreme-network.net

http://www.geekoblog.info

http://www.articlemag.info

kitkat said...

Goodness! I don't believe this!

For a country that prides itself on good governance, we have a stat board that has never been audited? In 46 years? That must have since policemen wore shorts!

Will Someone audit the AG please?! Does the AG not have its audit procedures?

Gawd!

Anonymous said...

Agreed kitkat. Who will watch the watchers? By the way, anyone knows if such audits are published for public consumption? I mean it's funded by taxpayers' money!

Ahnongnehmerse said...

this is absurd. and baffling. what are the people up there doing?

everytime something happens, the aftermath would be more skeletons being dug out and air dried in public.

Losing faith in the govt is just a matter of time if there are more hiccups then cover-ups and we shall see whether Dynamo detergent whitens their shirt anymore.

Anonymous said...
This comment has been removed by a blog administrator.
Anonymous said...

what's so surprising about this guys??

the fact that our public / government offices had been wasting money had been screaming at us in the face for the past many years...

that the government office has no governance is not surprising

what is surprising is that there is actually a public accounts committee and a role of an auditor-general!!

i like their job of doing nothing yet be paid...

Anonymous said...

Oh crap. Its the same in each and every ministry here. Since when has anyone in SG talked about accountability? Only the sheeps believe that all is good in Singapore and there is no corruption.

Truth is, corruption is legalised in Singapore. So much that you now accept it as a part and parcel of your life.

Cmon, what can you say about a population that can be swayed by a progress package just before elections? They simply dont have the vision to see thru simple vote buying politics.

Singapore is a classic example of the "Fence eating the crop".

Anonymous said...

The GLCs also practise legalised corruption in the guise of improving public relations. If one is involved in GLCs, one would know that there are many authorised forms of PR exercises that can be practised in Singapore in the form of unlimited benefits such as free lunches/dinners, hampers, discount vouchers, etc.

Would any person is so naive as to really believe that is such a thing as a free lunch in this wheeling and dealing business circle, GLCs included.

zhixiang said...

every organizations have a degree of "NKF". its up to the watchdogs to close one eye and the players' creativity to manipulate the system legally.

thats why most of these players are actually lawyers themselves(TT Durai is a lawyer too), or hire capable lawyers, to help them siphon money from their organization by spotting loopholes.
its very easy in fact.

with an intention to cheat, just spend a few days looking through the rules and regulations of a system and you will get to find some flaws to capitalize on.

maybe the code of ethics should be more emphasized in management and law degrees.

hahah. but if you can earn more money "legally"(it could be wrong morally), who cares about ethics and honour?

Anonymous said...

This is like Nazis Germany. Keep bombarding the people with lies and over time, the lies become the truth.

Auditor-General? Probably too busy figuring out how to spend his pay hike!

S said...

spare the auditors a thought. the entire government is being audited by a very small outfit. the auditors cannot be at every government agency checking every single account.

better they discover it now than never, given their very limited resources.

the auditor general's office is also undergoing change with a new ag and the employing of more manpower. give it some time.

T said...

& nt 4getting another of LKY’s favorite investment vehicle (even bigger than Temasek!!), the GIC which primarily invest the country's foreign reserve (>USD$140 billion). Both its internal process & financial activities which hav nvr evr been publish publicly.

scb said...

When regulators fail in themselves, those they regulate know opportunities are abound to exploit ! Some called them "loopholes", aptly so. The question is; why are regulators not been held responsible for failing in their duties? Are their(regulators) higher ups negligent too?

zhixiang said...

>spare the auditors a thought. the entire government is being audited by a very small outfit. the auditors cannot be at every government agency checking every single account.

better they discover it now than never, given their very limited resources.

the auditor general's office is also undergoing change with a new ag and the employing of more manpower. give it some time.<

limited resources? are you joking? a government-backed department's budget is always more than enough.

better now or never? they have been cheating the people for 42 yrs for goodness sake.

the PAP should be replaced. better now or never.

reader said...

Why drop this bombshell right after UNSW pulled out?

With the onset of the failure of the UNSW deal, this announcement about EDB is for spinning purposes. It is to show that EDB is not perfect, the UNSW failure by EDB need to be acceptable to the public. Our national print media has already started to spin and to shift the blame away. They even have that Chua woman written a subtle piece of news of shifting blames.

It is about deflections.

Anonymous said...

They are one big family mah so no need to audit one another seriously. The AG office is just one wayang "for-show-only" unit. Toothless Tiger!

Anonymous said...

Singaporeans signed over their rights as citizens and their children's rights as citizens by electing a party that advocates the rule of mandarins over that of democratic representation.

Words like accountability, ethics, responsibility take on a different meaning under such circumstances.

This may not be a worst choice. After all, Singapore is unique and it'd take a leap in logic to say that what works for the West will work here.

That said, we'd have the next four years to tell.

Anonymous said...

From what I understand from a friend in the civil service, Stat boards have the choice of requesting for external audit to be done by either the auditor-general or appoint an external one, eg one of the big-4s..... so, things may not be as bad as it seems. After all, in order for them to release the accounts, the figures have to be audited. And for the figures to mean anything, basic test of internal controls should be performed.

reader said...

This is one of the reasons why AG took so long:

http://www.ago.gov.sg/faq.html

5. Does AGO audit all statutory boards?

AGO is empowered under the law to audit statutory boards. Under the law, AGO is the permanent auditor of MAS. For the other statutory boards, AGO audits them on a selective basis. Otherwise, they are audited by commercial auditors appointed by the Minister in consultation with the Auditor-General.

And Question #3 makes you wonder about the state of affairs that is really happening.

3. Is AGO part of the Ministry of Finance?

AGO is not part of the Ministry of Finance or, for that matter, any other ministry. It is an independent organ of state like the Judiciary and the Attorney-General's Chambers. The Auditor-General is appointed by the President. He submits his annual report to the President and the report is then presented to the Parliament.

But who selects them?

Anonymous said...

This is a not a country that operates by rule of law; it is one that operates by rule BY law. So don't be surprised that it is a myth that no one is above the law. Good governance in Singapore? That's just for the governed (who can't be trusted) and does not apply to the governors (who are deemed men of integrity by virtue of the 'rigorous' PAP process). The smart Singaporean will not keep all their assets and cash in Singapore.

Mr Wang Says So said...

If AGO has been suffering for a long time from a lack of manpower, then this in itself represents a risk - that it isn't able to properly discharge its duties of auditing government ministries and agencies.

If EDB has been audited by external auditors and past reports have been showing up clean, then something probably also has gone wrong somewhere and we must ask whether the external auditors have done their job properly.

Anonymous said...

However, do you think the external auditors of Temasek would venture to report any shortcomings? I wonder.

Anonymous said...

This is just a red herring to distract from the billions lost. The report from the committee doesn't carry any punch anyway.

Standard phrase goes something like the errant officer(s) has/have been counselled. The committee is satisfied with the actions taken.

Where is the transparency and serious intent? $1000 fine? They must be kidding.

No wonder we have to pay and pay.

Anonymous said...

At the end of the end, it boils down proper check and balances. This applies not only to EDB but to the gahman as well. So, who is going do do an audit on the gahman in $ingpaore, I wonder. Investigative journalism? The opposition parties? Independent committees? It makes me wonder how reliable is that so called "self-renewal" (whatever that means)creature conceived by the PAP.

Anonymous said...

When President Ong Teng Cheong asked for a list of Temasek's investments and the people responsible told him that it will take 50 years to do it, what does that tell you?

Tall^Frog © said...

Quis custodiet ipsos custodes? Or rather, "Who watches the watchmen?"

Kaffein said...

What has the AGO been doing? Simple.

Giving themselves pay rise, I'd suppose.

I'm not surprised, actually. These days it is kinda of the acceptable norm. Just get on with life. With the NKF fiasco, the ministers' pay hikes, etc, what else can you expect?

The truth is cracks are appearing more and more. Seems to me like a dam is going to blow up some time soon.

Simply amazing.

Anonymous said...

kaffein: "The truth is cracks are appearing more and more. Seems to me like a dam is going to blow up some time soon."

Agreed. I just aim to get out before the dam burst :-P

Anonymous said...
This comment has been removed by a blog administrator.
Anonymous said...

Yeah - I wonder who in the world dares to audit GIC - if MM Lee is still around. Funny - all the CPF monies from the public, and all we get is a pittance 2.5 percent -every year?? Who keeps the rest? Why? So that the salary of people in GIC gets bigger and bigger?

Anonymous said...

well, if u can make the kinda money that those workin in GIC can, then u should go and grab that piece of pie, and stop whinning over here!

Anonymous said...

Such a wonderful slap in the face for LKY and his endless claim that there is no need for independent checks and balances. Oh wait i guess he will just throw me his latest retort "for a 4 trillion economy, you have no sense of proportion!" LOL

1984 said...

Where's the GIC money? Probably in some Swiss bank account being saved for a rainy day when MM Lee retires to a US State near you under the alias: Marcos

Cervantes de Leonard said...

A new AG who just took over only about 2 months ago and he's already doing alot of change the organisation.

That's why the AGO is actually doing it's job now and working to flushing out other NKFs.

The audit of EDB is a sign that the new AGO is moving in the right direction, so give them credit for that.

Anonymous said...

To the Anonymous person who wrote the following on May 27, 2007 10:27 AM:

"This is like Nazis Germany. Keep bombarding the people with lies and over time, the lies become the truth."

I hope you were referring to the WWII times and not current day Germany.

Anonymous said...

To S who said the following on May 27, 2007 10:57 AM:

"the auditor general's office is also undergoing change with a new ag and the employing of more manpower. give it some time."

Singapore is not a 3rd world country and 46 years is hell of a long time. Too long if you asked me.

simplesandra said...

UNSW, CitySpring, and now this....

But then, what's new, really? A few years back, it was reported that over a billion went unaccounted for in MINDEF. That was written off without too many questions asked.

All this talk of incorruptibility, transparency, and most of all, accountability by the PAP is utter rubbish

Cervantes de Leonard wrote: "That's why the AGO is actually doing it's job now and working to flushing out other NKFs."

The late President Ong Teng Cheong was also trying to do his job years back, and was obviously too efficient at it. I like to share your optimism, but after all these years, I've given up trying.

By the way, did the Straits Times publish this news?

Anonymous said...

It is such a coincidence that this comes up after EDB top man is changed. So, what is happening all the while? Make you wonder ...

Billybong said...

Should this come as a shock at all?

With an organization as 'reputable' as NKF falling victim to greed, could our ministries be any more accountable? What is the number of audits that have been performed on our ministeries by external auditors?

Didn't MINDEF charge one of their senior officers for deliberately awarding a contract to one of his regular contractors? Has anything changed after that?

MM Lee likes to preach that his ministers are above corruption, and thus justifies their exhorbitant salaries; has he checked those in their respective ministeries? Are they above corruption? With their bosses taking home a ridiculous wage package, surely there are some disgruntled 'Sean Lees' who 'reward' themselves with a few 'riches'?

Anonymous said...

Anon 8.11am 28th

Were you refering to the untouchable blue-eyed boy of you know who?

Anonymous said...

I think AGO has just had a change in leadership a couple of months back. Hence, you guys can see the new direction it is heading towards which is a good thing.

Rob

MadHatter said...

Why the feeling of outrage? Isn't this something we should be getting used to already? After all, despite the whistle-blowers (who were promptly stifled with lawsuits) it was business as usual for messers Durai and Co until they decided to bite off more than they could chew.

"Reaction" is the guideline of the day and that usually follows the NS rule of "do what you like - just don't get caught" - be it someone involved in a crime (was anyone injured? if not we can't do anything....) or an organisation with "lapses" of some form or another, until something of significance (and can't be swept under the carpet) occurs, it's business-as-usual for all

Anonymous said...

I wonder what will surface when they change the present untouchable leadership of Temasek?

Anonymous said...

Re: NKF? Chee Soon Juan has been calling for accountability for ages. And he was promptly sued and bankrupted. There are bigger skeletons in the closet.

Bryan said...

I wonder what uncle Lee has got to say with this incident.

Where is the money? where is the money?

check out this video for national education in a different perspective
http://www.youtube.com/watch?v=f_DRoUOcupo

Anonymous said...

What would one expect to find by opening a 46 year old closet?

Seriously...one opens to clean up, not incriminate or otherwise.

geriatric_eunuch said...

What would one expect to find by opening a 46 year old closet?

SKELETONS, what else?
Followed by an inquest and an independent forensic audit. Then punishment for the innocent and a pay rise for the guilty. All's well that ends well. Next.

Anonymous said...

"MM Lee likes to preach that his ministers are above corruption, and thus justifies their exhorbitant salaries; has he checked those in their respective ministeries? Are they above corruption? With their bosses taking home a ridiculous wage package, surely there are some disgruntled 'Sean Lees' who 'reward' themselves with a few 'riches'?"

To Anon, May 28, 2007 9:51 AM

Corruption is not in their dictionary, only HONEST MISTAKES exist.

Anonymous said...

Somebody in the EDB has to be answerable and responsible to all Taxpayers money in this incident. It is not just a dollar issue, it is million!!!!!

Anonymous said...

china recently issued a death penalty to its corrupted gahmen's assistant. it is an applaudable act of justice & deterrence.

in japan, their gahmen's assistant commits suicide recently. back in the train accident a few years ago, their transport minister steps down over this failure to oversee the situation. he has a true conscience towards the masses.

Anonymous said...

The problem with issuing death / terminal sentences is that it makes it difficult for the system to keep itself in check. Remember that Singapore's system relies on an internal system of checks. In any organisation, there's the unwritten rule of mutual dependence, A knows B who knows C who knows A. It may require a 'Et too Brutus' situation to set such a check in motion.

Death / terminal sentences encourages a situation where everyone is covering each other's back(side) and can potentially lead to convoluted charades.

Still it would be a good idea for the powers above to keep things in check before mass indignation erupts. Remember NKF?

geriatric_eunuch said...

Oooh, the death penalty or suicide for financial crime? That level of punishment is a little too bloodthirsty, don't you think? I sincerely hope that even our "flog'em/hang'em to send a signal" gov't wouldn't stretch to those extremes. If that was the penalty world-wide, these Volkswagen threw orgies for MPs and union officials executives would be fingering their necks nervously, I imagine.

Anonymous said...

Why is this happening ? Very simple. Despite claims of being a first world nation, Singapore has one of the most archaic labour laws in the world. The employer is empowered with more rights than an employee leaving an employee basically rightless. No government organisation or any of the large international / mnc's in Singapore has ever been sued for any wrong doing even if they were truely guilty. The law has been designed to favour only one party which means your boss is always right even if wrong, so whistle blowers would be a rare breed from within even if they knew something was amissed. If an individual was wrongfully dismissed for whatever reason, can this same person proceed with legal action ? Compare this action alone with all other governing laws in other commonwealth countries for which british legal system was derived from.