AHTC to transfer $14m to sinking fund

This article is more than 12 months old

The Aljunied-Hougang Town Council (AHTC) has promised to make up for a shortfall in its sinking fund by transferring close to $14 million to it this year, its independent auditor KPMG said.

The transfer will be made in four instalments of close to $3.5 million each - in February, May, August and November.

According to a monthly KPMG progress report released by AHTC yesterday, this amount will cover:

  • A shortfall of $5.3 million in sinking fund transfers that should have been made between August 2011 and March 2016
  • A matured bond worth $2 million - including interest - that should have gone into the sinking fund but was erroneously transferred into the operating fund
  • About $6.6 million in input goods and services tax (GST) claims arising from sinking fund expenditures for the financial years 2011/2012 to 2015/2016.

Input GST claims are claims from the taxman that businesses and other entities can make when they incur GST on their purchases and expenses.

With these latest promises, AHTC has resolved two audit points pertaining to the incorrect computation of required transfers to the sinking fund, shortfalls or delays in transfers to sinking fund bank accounts, and the incorrect use of sinking fund monies.

As a result, the Workers' Party-run town council has, to date, resolved 15 of 17 financial and governance problems flagged in past audits.

The report also noted that AHTC has started to put in place measures to remedy one of the remaining two problems, which relates to the lack of monitoring and exercise of diligence over collections from and payments to external parties.

The other outstanding issue - related to the "opening balances" of its accounts - is subject to further review and recommendations by KPMG.