by BERNAMA / pic by BERNAMA
The grant management and compliance audit from the ministries to federal agencies by the National Audit Department (NAD) has found that the balance of grant totalling RM83.67 million for 67 completed development projects and programmes has not been returned to the Federal Treasury.
The findings were reported to have occurred in eight agencies, according to the Auditor-General’s Report on the financial statement validation and federal agency compliance auditing 2018 released today.
The report said the agencies involved were the Malaysian Highway Authority (MHA), Construction Industry Development Board (CIDB), Forest Research Institute Malaysia (FRIM), Malaysia External Trade Development Corporation (MATRADE), Intellectual Property Corporation of Malaysia (MyIPO), Fisheries Development Authority of Malaysia (LKIM), Malaysian Agricultural Research and Development Institute (MARDI), and the Federal Agricultural Marketing Authority (FAMA).
The audit department reported that from 2019 it started to implement compliance auditing on federal agencies to replace the financial management auditing based on risk.
Besides grant management, the NAD also implemented investment auditing of public universities in subsidiary companies and procurement management at Social Security Organisation (SOCSO).
“A total of 44 subsidiary companies and sub-subsidiaries of 14 public universities experienced negative net tangible assets amounting to RM118.26 million in 2018.
“Subsidiary companies of Universiti Sains Islam Malaysia (USIM) saw negative net tangible assets for two consecutive years which amounted to RM2.30 million in 2018 and RM1.06 million in 2017,” it said.
Meanwhile, as for SOCSO, the NAD found that, among others, five procurements worth RM247,058 had been broken up into smaller ones and made via direct purchase, and that payments were still not made for between 30 and 4,007 days which involved 145 transactions from 34 suppliers.
For improvement, the NAD has recommended enforcement in the determined grant usage conditions, return procedures for the balance of grant and procedures for the time extension for project continuation.
The NAD also proposed for the creation of an efficient monitoring mechanism, review the investment performance in subsidiary/sub-subsidiary companies and compliance to accounting rules and compliance to procurement procedures manual so that the procurement management can be implemented with transparency, efficient and effective.