HDB, AHTC now locked in disagreement over choice of accountant

The Ministry of National Development (MND) and HDB issued a joint statement outlining the issues that they and Aljunied-Hougang Town Council (AHTC) put before the Court of Appeal on Thursday, suggesting that both parties remain in disagreement over the choice of accountant that the apex court ordered AHTC to appoint.

Responding to media queries, HDB said it disagreed with the town council's choice of accountant, Business Assurance, and had sought more information earlier this week from AHTC about the proposed firm.

The Court of Appeal on Nov 27 ordered the town council to appoint accountants to help the town council rectify contraventions of the Town Councils Act. It also ordered AHTC to make good on all outstanding sinking fund transfers, by establishing whether any past payments made by AHPETC were improper and ought to be recovered.

HDB told AHTC that based on the information it had submitted, Business Assurance "did not appear to have the requisite expertise, experience and capacity to carry out the duties envisaged by the Court of Appeal's orders". HDB had suggested to AHTC that it appoint any of the major four public accounting firms in Singapore.

"AHTC did not respond to HDB's queries by the time of the hearing. The Court ordered an adjournment, and directed AHTC to file an affidavit to respond to HDB's queries."

MND and HDB added that AHTC had tried, unsuccessfully, to limit the accountants' terms of reference, to: (a) the non-compliances identified by the Auditor-General's report of February 2015, and (b) any improper past payments involving its former managing agent, FM Solutions & Services (FMSS) and FM Solutions and Integrated Services (FMSI).

"The Court disagreed with AHTC," MND and HDB said.

Instead, the appointed accountant is supposed to look at all non-compliances of the Town Councils Act which had been identified by the AGO report, and by AHPETC's own auditors, in its audited financial statements for FY 13/14 and FY 14/15. The terms of reference should extend to examining whether any past payments made by the town council were improper and should be recovered. This should not be limited to only transactions involving FMSS and FMSI.

MND and HDB said AHTC had also attempted to seek legal costs and disbursements from MND and HDB for the hearings before the High Court and Court of Appeal. This was dismissed by the Court, which directed that each of the parties should bear their own legal costs for the hearings before the High Court and the Court of Appeal.

They said the earlier media release issued by AHTC is "misleading, and presented a selective and incomplete account of the events that transpired before the Court of Appeal today". AHTC said in its release that it noted the Court's "helpful clarification" that the accountants to be appointed were not being given a carte blanche to look into the town council's affairs. It added: "AHTC welcomes the Court's rejection of the submission of the Attorney-General's Chambers (representing MND & HDB) that AHTC's conduct of its defence during the course of the hearings at the High Court and at the Court of Appeal was egregious and somehow improper."

HDB said it "looks forward to AHTC's compliance with the Court of Appeal's direction and to receive the information it had earlier requested from the AHTC". Both will appear before the Court of Appeal again late next week.