• Published Date: 08 Jul 2016

    1.         The Court of Appeal (CA) ruled today that the professional accountants of Aljunied-Hougang Town Council (AHTC) and Pasir Ris-Punggol Town Council (PRPTC), namely KPMG and PricewaterhouseCoopers (PwC), should communicate directly with each other and provide to each other access to documents as may be reasonably required to safeguard each other’s interest.

     

    2.         HDB, as a party to the CA Judgment1, has an interest to ensure that the CA orders are properly complied with. AHTC did not agree that PRPTC is bound by the CA orders in relation to Punggol East SMC (PE), and had refused to give PRPTC access to documents for it to carry out its review on whether any of PE’s past payments made by Aljunied-Hougang-Punggol East Town Council (AHPETC) were improper and ought therefore to be recovered. AHTC also refused to attend coordination meetings called by HDB and requested that HDB first apply to the CA to clarify whether PRPTC was bound by the CA orders (see Annex).

     

    3.         The CA ruled that PRPTC on behalf of PE has an interest in the outcome of the work carried out by KPMG. HDB also notes that AHTC had, in Court today, agreed with this view.

     

    4.         With reference to AHTC’s media statement today, AHTC had not presented the full picture when it asserted that PRPTC’s appointment of PwC would result in “a duplication of the work being done by KPMG”. What AHTC failed to mention is the fact that shortly after the CA’s judgment on 27 November 2015, HDB had on 4 December 2015 suggested that AHTC and PRPTC jointly appoint accountant(s) to carry out the CA orders to avoid duplication of effort, competing access to documents and incurring unnecessary costs. No joint appointment materialised as AHTC rejected it. In these circumstances, HDB consented to PRPTC appointing PwC as its accountant to carry out the CA’s orders. Had AHTC agreed to HDB’s suggestion to work with PRPTC to jointly appoint one set of accountants, there would not have been the need for PRPTC to appoint PwC separately.

     

    5.         Following the directions given by the CA, HDB expects AHTC and PRPTC to do all that is necessary to facilitate the work of the accountants, KPMG and PwC, in carrying out the orders of the CA.

     

    [1] In its Judgment dated 27 November 2015, the CA made various orders against AHPETC to compel its compliance with the Town Councils Act (TCA) and Town Councils Financial Rules (TCFR). This included an order that AHPETC must appoint independent accountant(s) to assist in identifying its outstanding non-compliances with Section 35(c) of the TCA, advise it on appropriate remedial steps to be taken, and establish whether any past payments made by AHPETC were improper and ought therefore to be recovered.