AGO AUDIT: TEMASEK POLYTECHNIC HAD INVESTED $62.5M IN BONDS. WHY NO FREE EDUCATION?

Dear editor,

I am curious and read the latest Auditor-General's report that was issued last week.

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But what I read shocked me because one of the stat board, Temasek Polytechnic had actually invested $62.5 million in bonds! Are those investment monies surplus from their operating expenses?

If TP was able to invest so much, I am curious why Singapore citizens still have to pay school fees. Look at how many Singaporean parents need to use their CPF funds to pay for their children's polytechnic fees, then after graduation, the children had to pay back the CPF monies with interest in cash. It doesn't make sense. You pay using CPF, the monies should be returned via CPF, not cash.

The following are extracts from AGO audit report:

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98. AGO found lapses in the Temasek Polytechnic (TP)'s evaluation of and approval for its investment in bonds. TP did not ensure that requisite approval had been obtained before it proceed with its investment in five bonds. In addition, for two of the bond investments, there was no assurance that the evaluation on the investments was robust. As the investments involved a large amount of public funds, it is important for TP to properly evaluate the proposed investments and seek approval before making the investments.

99. As at 31 March 2014, TP had invested $62.50 million in bonds. AGO's test checks of five bonds totalling $61.50 million revealed that for all the five bonds, TP had proceeded to make the investments before obtaining the requisite approval from its Investment Committee.

100. AGO also noted, based on documents provided, that for two of the five bonds (totalling $40 million), the evaluation and subsequently the decision to invest in these two bonds focused only on the bonds' interest rates. There was no documentary evidence that other relevant factors, such as the business nature and performance of the company that issued the bonds were considered. In addition, TP's evaluation relied heavily on inputs sought from a person who had a interest in the company that issued the bond. With these lapses, there was no assurance that the evaluation was robust.
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