The Aljunied-Hougang-Punggol East Town Council (AHPETC) has hired an external accounting firm to help it clean up its past accounts, said its chairman Sylvia Lim in a statement yesterday.
The firm will also advise AHPETC, which is run by the Workers' Party (WP), on internal audit matters and how to strengthen its internal controls and processes, added Ms Lim, who is also WP chairman.
The move comes after a special audit by the Auditor-General's Office (AGO) found accounting and governance lapses at the town council, including potential conflicts of interest arising from key AHPETC staff being co-owners of its managing agent FM Solutions and Services.
Yesterday, Ms Lim revealed that AHPETC engaged the accounting firm on March 3 - about a month after the AGO's audit findings were released, and two weeks after Parliament held a heated debate over the lapses at the only opposition-run town council.
Her statement, posted on AHPETC's website, comes as the High Court deliberates over whether to allow an application by the Ministry of National Development (MND) to appoint independent accountants to oversee government grants given to AHPETC.
Only if the court gives the nod will the ministry release about $14 million in grants to AHPETC - money disbursed to all town councils but which MND has withheld from AHPETC for a year now due to its governance and compliance lapses.
MND's application, which was made on March 20, also asks the court to look at past AHPETC payments and take appropriate action to recover any losses suffered by AHPETC and its residents.
Political observer Eugene Tan said it was puzzling that the WP waited two months to announce the appointment of the external accounting firm.
"It's baffling because the move is a positive one and would have been welcomed by residents and the MND," Prof Tan, an associate professor of law at the Singapore Management University, told The Sunday Times yesterday.
"But it's a clear attempt not to be dictated to. They want the courts to see that they recognise that accountants are needed and they can run their own show."
Media queries directed to Ms Lim about the name of the external accounting firm and the tenure of its engagement were not answered by press time yesterday.
In Ms Lim's statement yesterday, she also reassured residents that AHPETC is "working hard" to file its FY 2013/14 accounts by June 30 and its FY 2014/15 accounts by Aug 31 - deadlines that had been set earlier by the MND.
In addition, the town council will soon send letters to its residents providing details of key points from the AGO report and parliamentary debate, as well as "clarifying some misconceptions that have been circulated", she said.
"Due to the importance of the subject, we have taken some time to prepare this letter," Ms Lim said. "The past months have been challenging, but AHPETC remains undaunted," she added.
The MPs of AHPETC "are mindful of our duty to be accountable to you, the residents who have put us in office to serve", said Ms Lim.
"You have supported us, and we will do our best despite the challenges we face."