Sri Siva Krishna Temple is a registered charity since 1998. It is also an endowment as defined under the Hindu Endowments Act.
In 2008, on the invitation of the Temple, the Hindu Endowments Board (HEB) assisted the temple in organising Consecration and managing its financial affairs as the temple was in bad shape financially. A Protem Committee was set up by HEB for this purpose.
In end July 2009, the HEB highlighted to the Ministry of Community Development, Youth and Sports some areas of concern with how the temple was being managed before the Protem Committee came on board. Following this, the COC carried out a review on the temple.
The review found many financial irregularities such as lack of control over management of cash collections, missing receipt books and lack of control in payment processes.
On Feb 24, the COC launched a formal inquiry on the temple under the Charities Act.
Key inquiry findings
Poor Corporate Governance and Management
Mr Sivalingam in his capacity as the temple's President had unilaterally made decisions on substantial capital expenditures on behalf of SSKT. For example, he had instructed a vendor to amend the original scope of work and performed additional sculpturing work amounting to about $70,000. This resulted in the total contract value to increase from $70,000 to $140,000.
Members of the Management Committee were not aware of their appointment in 2007 and 2008, only to be informed by HEB in 2009. They were under the impression that they were merely appointed to a working group, which was formed to assist the President in the preparation for the consecration ceremony.
Deficiencies in internal control of Temple
The Honorary Secretary and Honorary Treasurer had pre-signed on unused blank cheques so that Mr Sivalingam would be able to issue the cheques promptly by embossing his signature on these pre-signed cheques.
Cash donations collected were not deposited into SSKT's bank account regularly. Although the temple collected about $1.2 million in cash from Jan 1 2007 to July 31 2008, only $400,000 were deposited in the bank account. The balance was purportedly used to pay for the temple's operational expenses in cash.
It has been noted that during the period, $1 million - amounting to 60 per cent of the total expenditure - were paid in cash. These include payments of $200,000 made from the building fund. Cash payments as high as $18,000 had been made to vendor in one payment. While Mr Sivalingam claimed that the vendors had requested for payments to be made in cash, the vendors claimed otherwise.
Accounting entries were recorded by Mr Sivalingam in pencil, payment vouchers prepared by him were not serially numbered and cash and gold collected were found in drawers other than the designated cupboard for such donations. Receipt books were not properly accounted for and some were found to be missing.
'There was a severe lack of segregation of duties and checks and balances. For instance, the President had sole custody of the donation monies and gold received by the Temple. He maintained the accounting records, approved contracts/purchases and disbursed cash/cheques on behalf of the Temple,' said the COC. -- ST PHOTO: DESMOND WEE
AN INQUIRY by the Commissioner of Charities (COC) has found financial irregularities and serious lapses in the governance and management of the Sri Siva Krishna Temple (SSKT) in Marsiling Rise.
The Commissioner has lodged a report with the Commercial Affairs Department (CAD).
The inquiry, which was launched in late February, found evidence of suspected forgery of payment vouchers and misappropriation of the temple's funds between January 2007 and July 2008, said a statement from the Commissioner of Charities on Thursday.
These include payments purported to have been made but not received by the vendor, donations made to the temple but not accounted for in its accounting records as well as missing donation receipt books.
These transactions took place between January 2007 and July 2008 before a protem committee, set up by the Hindu Endowment Board (HEB), took charge of the temple's financial affairs. The temple has been a registered charity since 1998.
While there was a management committee, the temple was effectively 'in the sole control' of the then President, Mr Arumugam Sivalingam, said the COC.
'There was a severe lack of segregation of duties and checks and balances. For instance, the President had sole custody of the donation monies and gold received by the Temple. He maintained the accounting records, approved contracts/purchases and disbursed cash/cheques on behalf of the Temple,' said the COC. 'Most of the decisions of the Temple were made by him or with his acquiescence.'
The Inquiry also revealed severe deficiencies in the internal controls of the temple. These included lack of proper procedures and controls over the revenue collection and receipt books, the practice of pre-signing cheques, cash donations not deposited into the bank account regularly, large amount of payments - as much as $18,000 in a single payment - made in cash, payments not substantiated by supporting documents, and no proper accounting records were kept.
The COC said a new management committee was elected at the temple's annual general meeting held in April. He noted that while Mr Sivalingam voluntarily resigned from the office of the President on May 6, he was subsequently elected as the temple's advisor and chief executive officer from May 22.
'Given the inquiry findings of mismanagement in the administration of the temple during his tenure as the President, the COC is concerned with his continued involvement in the temple's affairs,' said the Commissioner, who has initiated action to remove Mr Sivalingam as a charity trustee to prevent him from being involved in the general control and management of the administration of the temple or other charities.
The COC added that the findings from the inquiry had been given to the Management Committee and the Protem Committee had put in place internal controls and cash management procedures at the temple.
'The new Management Committee has been advised to strictly adhere to these measures so as to ensure the temple's proper administration going forward. COC has also advised SSKT to continue to let HEB manage its finance affairs, to ensure that these internal control measures can be sustained,' added the COC.'
