Wednesday, 27 October 2010

HDC Malaysia pays consultant without proper contract – Auditor General

The Halal Industry Development Corporation Sdn Bhd (HDC) did not have proper documentations for rebranding works and expenditures for its World Halal Forum (WHF).

The international event was the annual agenda of KasehDia Sdn Bhd, the consultant and advertising company which published the Halal Journal.
Former World Halal Forum Chairman Mr Khairy Jamaluddin
It had asked HDC to host the WHF and sponsor RM500,000 in January 2007. However, the audit findings showed that there was no formal agreement signed between HDC and KasehDia regarding the sponsorship but only conditions laid out by the Board of Directors.
The audit also found that the miscellaneous fees of RM1.15 million paid to KasehDia in 2007 and 2008 did not have a strong basis as there were no details of the expenditures provided.
According to KasehDia’s brief expenditure report, the payment was used for the advertising and promotional activities of WHF, Public Relations Campaign, promotional trips to overseas, television and documentary participation programmes.
HDC also did not state the specific terms and conditions regarding WHF’s expenditure proper especially for the overseas promotional trips like daily allowances, phone allowances, the number of participants and the number of days.
Besides that, there were also several payments made to KasehDia for things that are not related to WHF like the purchase of souvenirs, medical fee for KasehDia staff and purchase of poster.
HDC’s response to this was that it only functions as the financial dealer (penyalur) for the government in organising the event.
A total of RM4.69 million, including the host sponsorship of RM500,000, was given to KasehDia from the government through HDC. Upon the Finance Ministry’s approval, HDC appointed KasehDia, through direct consultation, as the Interim management Consultant with the fee of RM1.81 million.
The audit report also revealed there was poor corporate administration and financial management where there is no Internal Audit Unit in HDC.
The AG said it could not determine any reason for HDC to appoint an Interim Management Consultant as the scope of its work only covers administration that does not require special expertise.
The AG is of the view that HDC should ensure the agreement contract is signed with all appointed consultants and have a complete enforcement clause in the agreement to ensure accountability.
Source: The Sun Daily

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