AHTC trial: Defence rebuts PwC's findings that invoices issued breached financial rules

AHTC trial: Defence rebuts PwC's findings that invoices issued breached financial rules

File photo of Aljunied-Hougang Town. (Photo: TODAY)
SINGAPORE: Proceedings on the fifth day of the landmark Aljunied-Hougang Town Council (AHTC) trial delved into various invoices that Pasir Ris-Punggol Town Council (PRPTC) had taken issue with.This was over a lack of signatures on one set of invoices, and a lack of documentation on another.
The exchange was between PRPTC's witness, PricewaterhouseCoopers (PwC) partner Goh Thien Phong, and Senior Counsel Chelva Retnam Rajah, who represents Workers' Party (WP) Members of Parliament Sylvia Lim, Low Thia Khiang and Pritam Singh, along with two AHTC councillors.The defendants are accused of breaching the Town Councils Financial Rules (TCFR), which stipulate how town councils should operate.

READ: S$60 million in payments recorded manually, says KPMG

In particular, 56 invoices issued by the town council in November 2015 that amounted to about S$674,000 were said to have breached the TCFR as they bore no signatures from the head of department.
These invoices, for goods or services done by contractors such as landscape and construction firms and security firms, are related to "improper" payments that AHTC is accused of allowing to its former managing agent, FM Solutions and Services (FMSS), and other parties.At that time, AHTC was known as Aljunied-Hougang-Punggol East Town Council or AHPETC as WP held the Single Member Constituency of Punggol East.The People's Action Party won Punggol East SMC in the 2015 General Election, after which the ward came under PRPTC.Mr Rajah on Thursday (Oct 11) asked Mr Goh, whose company's auditing report formed part of the basis for both PRPTC's and AHTC's lawsuits against the defendants, how exactly the 56 invoices breached the TCFR.
Mr Goh said that not having the head of department sign off on the invoices was a breach of financial rules.The relevant segment in the TCFR stipulates that: "It is the responsibility of the head of department to satisfy himself that … the prices charged are either according to contracts or approved scales, or fair and reasonable according to current local rates."

READ: Defence lawyers in AHTC trial slam the way KPMG compared managing agent costs

In response, Mr Rajah said there were various documents in the payment process, and that although the invoices may not have been signed off on, other documents had.Mr Rajah referred to the affidavit of current general manager and secretary of AHTC Vincent Koh Weng Kong, who rebutted the allegation, saying that it was "incorrect" to focus on the payment vouchers.He said the payment vouchers were prepared based on voucher journal reports, which had been properly certified and, according to him, fulfilled the requirements in the TCFR.To this, Mr Goh said that the invoices themselves have to be signed by the department head to ensure that amounts were accurate and works were properly done.“There is a procedure by the town council that everybody has to follow. It doesn't matter what Mr Koh thinks," he added.He explained that each document in the payment process serves a purpose, and has to be signed off by the relevant authority. "It doesn't mean that when one person signs on one of them, it can substitute another."

Senior Counsel Chelva Retnam Rajah cross-examines PwC partner Goh Thien Phong on Thursday (Oct 11). (Illustration: Lydia Lam)
WERE SUPPORTING DOCUMENTS GIVEN TO AUDITORS?During the cross-examination, Mr Rajah and Mr Goh also disagreed on whether supporting documents for some specific invoices had been given to the PwC auditors.Lawyers for PRPTC have contended that these 12 invoices – that AHPETC had paid in Nov 2015 – had missing or incomplete supporting documents and evidence of work done. As a result of the lack of documents, the payments were deemed "improper".However, Mr Rajah stressed that many of the documents were in fact handed over by AHTC to PRPTC in late 2015. He pointed out that during that period, AHTC was in the midst of handing over documents pertaining to Punggol East to PRPTC.

READ: MND had 'no difficulty' accepting AHTC's waiver of tender for managing agent, says defence

He also pointed to a chain of emails exchanged between PRPTC's general manager Kwok Wei Kim and Mr Koh, in which Ms Kwok had thanked Mr Koh for handing over the documents listed. "From the emails, it would appear that the documents were already with Ms Kwok," he said.
This took place, he said, almost 11 months before PwC began its work on Nov 1, 2016.However, Mr Goh responded that he was not aware of this. "It would be curious if this were the case, because supporting documents are supposed to come together," he said. “When we asked for it, the town council’s finance team at AHTC said it wasn’t there.”The trial continues on Friday with Mr Rajah resuming his cross-examination of Mr Goh.
Source: CNA/aa(hm)
Source : https://www.channelnewsasia.com/news/singapore/ahtc-trial-defence-rebuts-pwc-findings-invoices-breach-rules-10817348