BPK finds over 2,000 irregularities, state loses Rp7.1 trillion
BPK finds over 2,000 irregularities, state loses Rp7.1 trillion
Urip Hudiono, The Jakarta Post, Jakarta
The Supreme Audit Agency (BPK) found 2,128 cases of
irregularities in the management of state funds during the second
semester of last year, with potential losses to the state
totaling Rp 7.12 trillion (about US$765 million).
While an irregularity by the BPK definition does not
necessarily mean malfeasance, at least two cases worth a total of
$3.3 million in the Ministry of Defense and Ministry of Culture
and Tourism showed indications of corruption, BPK chairman Anwar
Nasution said in a report presented to the House of
Representatives on Tuesday.
"We have forwarded these two cases to the Attorney General's
Office for further investigation," Anwar told a House plenary
session to discuss the agency's regular audit of state funds.
The audit was conducted between July and December 2004 on 586
accounts worth Rp 282.89 trillion, which represents 64.84 percent
of the funds allocated under the 2004 state budget and local
government budgets, and in the financial reports of state-owned
and local government enterprises.
On the two cases that showed indications of corruption, Anwar
said that one was last year's $3.24 million procurement of MI-17-
IV helicopters by the Ministry of Defense and the Indonesian
Army, while the Ministry of Culture and Tourism appeared to have
improperly accounted for state inventories worth up to Rp 1
billion.
Anwar acknowledged that the audits were based on the BPK's
old auditing procedures and formats, and were also conducted by
BPK staff during the 1998-2004 term.
"In the future, we will conduct our audits using new -- and
hopefully better -- procedures and formats," he said.
"The new procedures and formats will include a performance
audit, a financial forensic audit and a fraud audit as stipulated
by Law No. 15/2004 on state treasury management, accounting and
auditing, as well as a general audit."
Commenting on the government's 2003 State Budget Report, Anwar
reiterated that the BPK had decided "to give no opinion on the
report."
"There are two main factors that have led us to do this," he
said.
"First, the government has yet to overhaul its accounting
system, and second, the government has still not followed up on
findings of irregularities in our reports over the past four
years."
Anwar further said that the BPK -- at the House's request --
was also conducting an audit on the funding of the 2004 general
election and fuel subsidy spending.
"The audit on the funding of the general election is now being finalized,
and we expect to have the complete results and a report within
three weeks," he said.
A source from the BPK told The Jakarta Post that the audit
agency had found preliminary irregularities amounting up to Rp 90
billion out of total general election funding of Rp 2 trillion.
The irregularities included Rp 60 billion for the procurement
of ballot boxes and Rp 30 billion for the procurement of ballot
papers, ink and ballot envelopes.
Despite the BPK's regular identifying of possible abuses in
state funds by government institutions, incidences of follow-up
action by the relevant agencies have been few and far between,
with many cases ending up unresolved.
Under the prevailing regulations, the BPK's reports are
supposed to be used by the relevant ministries and state
institutions as a basis for determining the necessary follow-up
action. In cases where the BPK believes there are strong
indications of corruption, it can directly report its suspicions
to the AGO.
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