Friday, October 18, 2013

Internal control on purchases


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Straits Times

I was surprised to read that a senior government official had been charged for submitting false claims for purchase of gifts to be given to foreign dignitaries over several years. 

I do not wish to comment on this specific case, as it is being handled in the court. However, I like to ask about the internal control system that is used in government agencies.

The basic principle of internal control is that each transaction should involve at least two people, to act as a check against abuse. The purchase has to be initiated by one staff and approved by the supervisor. It is possible for these two people to collude, but the risk is minimized.

I have dealt with government agencies over the years, and they are very meticulous about following SOP, even to the extent of giving some hassle to suppliers.

It is therefore very surprising that a basic principle of internal control is being overlooked to such an extent. I look forward to a reply from the Auditor General's Office.


yujuan said...

With the internet, cover ups are impossible now, explains why the spate of dishonest civil servants are a dime a dozen. They dun just sprout up overnight, believe they are everyday occurrences, right from LKY's and Goh Chok Tong's days.
The Govt is getting lazy and complacent, shows they themselves are resistant to change, sticking to outdated thinking, if the system ain't broken, why fix it? Just like the password of our email accounts or our internet trading accounts, if we dun change periodically, hackers could hack into system for criminal activities.
Ditto with outdated procurement systems, loopholes could take hold due to lapses.

yujuan said...

The Brompton case is another very interesting example of - the Govt can't find proof of corruption in the bicycle purchases, then seize upon the officer who did not own up he knew the Brompton supplier, and charge him of lying, and under uniquely Singaporean way of its own laws, was jailed on a simple Act of just lying.
Maybe, if you tell the truth during investigations, you could be spared a jail sentence.
But maybe only, they may then seize upon another childish reason to put you behind bars.
Nevertheless, better to own up first before the Authorities find out. In dealing with our Govt, honesty is the best Policy.

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