Saturday 27 July 2019

Muis responds to Auditor-General report for FY2018/2019

The Singapore Auditor-General's Office's (AGO's) report for FY2018/2019 has identified a number of lapses in the evaluation of tenders and quotations, including at MUIS, the Islamic Religious Council of Singapore.

AGO’s test checks uncovered 12 tenders and quotations (contract value totalling S$5.54 million) where the evaluation sub-criteria and/or scoring methodology used were only determined after the tender/quotation had closed. AGO noted that this could subject the evaluation process to manipulation as the sub-criteria and scoring methodology could be set during evaluation to favour certain bidders.

To ensure fairness, transparency and integrity in the evaluation process, the evaluation criteria (including the sub-criteria) and the scoring methodology should be established up front, the AGO said.

MUIS informed AGO that it would enhance its procurement process to align with best practices.

There were another four tenders and quotations (contract value totalling S$1.38 million) where MUIS did not evaluate the proposals according to its published evaluation criteria. The proposals were not evaluated when they met the critical evaluation criteria, or not disqualified when they failed to meet the critical evaluation criteria, or evaluated using criteria different from that published in the tender/quotation documents.

For one of the cases, the AGO noted that the winning vendor might have been someone else if the non-compliant proposals were disqualified from evaluation. By not evaluating the proposals based on the published evaluation criteria, MUIS could be subject to allegations of unfairness, the report noted.

MUIS informed AGO that it would enhance its procurement expertise, e.g. raising staff knowledge on procurement matters by organising evaluation criteria training for all officers.

AGO’s checks further revealed six tenders and quotations (contract value totalling S$4.40 million) where there were errors in the scores awarded to proposals during the evaluation process. The errors included the following:

- Awarding bidders full scores for a criterion when the requirement was not met;

- Using information of other entities to evaluate the bidders; and

- Not including bidders’ past projects as qualifying track records.

For three of the cases, had the proposals been properly evaluated and scores correctly computed, the awarded vendors could have been different, the AGO said.

MUIS acknowledged that there was room to enhance its evaluation of tenders and quotations. Going forward, MUIS will raise the seniority level for the Chairman of its Tender Evaluation Committee. This would allow better guidance during the procurement evaluation stage.

AGO’s checks of controls over user accounts and access rights for two of MUIS’ IT systems used for processing of applications and collections aditionally revealed weaknesses in the management of access rights granted to users, including conflicting access rights assigned to certain users.

AGO also noted that MUIS did not conduct annual reviews of access rights granted to users for four out of five IT systems checked.

"It is important that regular reviews of access rights be carried out to ensure that access rights no longer needed are removed promptly and only authorised users have access to the systems," stated the report.

AGO’s checks revealed that MUIS did not conduct annual reviews of access rights granted to users for four out of five IT systems during the period checked (2014 to 2018). This was contrary to the Government Instruction Manuals and MUIS’ own Standard Operating Procedures (SOP) which require reviews of accounts and access rights to be conducted annually for such systems.

The systems contain sensitive information relating to MUIS’ core functions (including financial information), making it critical to ensure that access rights no longer needed are removed promptly and only authorised users have access to the systems.

MUIS informed AGO that going forward, it will work with system owners to conduct regular account and access rights reviews as required under the Government Instruction Manuals and MUIS’ SOP. 

Lastly, AGO highlighted that Hajj administration fees relating to deceased applicants were not refunded quickly. Under the Administration of Muslim Law (Haj) Rules (Chapter 3, R 6), Hajj administration fees are collected by MUIS from persons who apply to perform the Hajj. If the applicant passes away before performing the Hajj, the fee is to be refunded to the estate of the deceased applicant.

AGO noted that MUIS would check the applicant’s status against its internal records when his/her allocated Hajj year is due and refund the administration fees to the estate at that point in time if checks establish that the applicant had passed away.

AGO’s audit revealed that the fees for 226 Hajj applicants who had passed away between 2012 and 2018 had yet to be refunded to their estate. The total value of Hajj administration fees yet to be refunded amounted to S$57,900. AGO noted that if MUIS waited until the deceased applicants’ respective allocated Hajj year to refund the fees, it could be many years later before refunds to their estate were made. This could also result in MUIS facing difficulties in locating the next of kin after such a long time, and then needing to manage the cases of unclaimed monies.
 
In a separate statement MUIS said it takes the findings of the AGO seriously and acknowledges the lapses observed, primarily in areas of procurement, management of IT rights, and instances where Hajj administration fees relating to deceased applicants were not refunded in a timely manner.

"Having reviewed AGO’s observations on procurement, MUIS has found no evidence of fraud. The lapses were due to human error and procedural weaknesses. MUIS acknowledges these lapses, and immediate steps have been taken to address the gaps and ensure alignment with government best practices," stated MUIS.

MUIS disclosed that it has been addressing the procurement shortfalls by progressively building up its capabilities in governance and procurement over the past few years. This includes strengthening training in governance and finance for officers. At the same time, more resources have been deployed to handle procurement and IT-related functions to ensure compliance with government financial procedures. Muis also conducts its own internal audits regularly to identify areas for improvement.

When it comes to the IT systems, MUIS said, "The issues raised by AGO on the management of IT rights were due to the limitations of our legacy IT systems. These have been addressed with the implementation of new IT systems in January 2019 with capabilities that address the shortcomings of previous systems. This is part of MUIS’ continual efforts to refresh our IT systems and harness technology to improve governance and serve citizens better, such as digitalising zakat payments through the new iPARS system, and leveraging the LicenceOne platform to expedite halal certification applications."

For Hajj administrative fee refunds, MUIS said that the estate of 181 cases (80%) of the 226 named have already received refunds, or are in the process of being refunded. The families of the deceased were uncontactable for the remaining 45 cases.

"Details of these cases have been uploaded on the unclaimed monies website. MUIS will further review our systems and processes to ensure more timely refunds for applicants who have passed on," MUIS said.

MUIS has also established a taskforce, chaired by the Muis Chief Executive, that will review and monitor the timely implementation of measures to address the findings of the audit. "We seek the support of our Muslim community as we improve our services and processes," MUIS concluded.