House mum on investigative audit for IBRA

Leony Aurora, The Jakarta Post, Jakarta

The House of Representative needs to submit a formal request for the Supreme Audit Agency (BPK) to conduct an investigative audit on the Indonesian Bank Restructuring Agency (IBRA), says a senior audit official.

BPK head Satrio "Billy" Budiharjo Joedono responded to journalists on Friday that the House had not made such a request, even though "reporters have repeatedly asked (about this issue)".

Several lawmakers have told the media over the past few weeks that the House might ask the audit agency to conduct an investigative audit on IBRA. Top government officials and analysts, including State Minister of National Development Planning Kwik Kian Gie and economist Faisal Basri, have also urged an audit into IBRA for possible cases of corruption or of legal violations during the agency's five-year existence. IBRA is scheduled to be closed down on Feb. 27, when its mandate expires.

Billy also said the House needed to explain what it meant by a comprehensive investigative audit, as an investigative audit verified whether an action or activity had been properly executed.

"During IBRA's operation, millions of measures and activities have been implemented," he said. "(Of these) Which specific ones need to be checked for their having been properly executed?"

Responding to a question as to whether or not the BPK would undertake such an audit on its own initiative, Billy said the agency would focus on a performance audit.

The BPK launched a performance audit in early January to see if IBRA had carried out its mandate, which was issued in 1998 after the monetary crisis.

Three groups of key performance indicators are used in a performance audit: The first group, used to determine the success of the recapitalization program, comprises capital adequacy ratio, non-performing loans ratio, loan to deposit ratio and return on equity.

The second, comprising debtor participation, number of credits resolved and credit restructuring implementation, assesses the asset restructuring program.

The third assesses the recovery of bank liquidity funds and includes divestment timing, consultancy cost and the recovery rate of government funds injected into troubled banks during the crisis.