Irregularities in state finances add up to Rp 209.43t
JAKARTA (JP): The Supreme Audit Agency (BPK) said on Monday it had found some 779 instances of irregularities involving Rp 209.43 trillion (US$23.27 billion) in the management of the state budget and state companies during fiscal year 1999/2000 that ended in March.
BPK chief Satrio Billy Yudono reported to the House of Representatives that the amount involved in the uncovered irregularities represented almost 46 percent of the total amount of the state budget and the budgets of state companies audited by the agency.
The report delivered by Billy to the House was based on audits conducted by BPK between October, 1999 and March, 2000.
"Of the 779 instances of irregularities, 504 involving Rp 208.80 trillion constituted non-compliance with regulations, 181 covering Rp 59.82 billion involved inefficiency and 94 involving Rp 573.45 billion concerned misallocation of resources," Billy said.
He added that Rp 204.72 trillion of the total involving non- compliance with regulations was related to the issuance of liquidity credits by the central bank (Bank Indonesia).
"Of this total, Rp 124.48 trillion consisted of liquidity credits from the central bank to commercial banks without adequate security and Rp 80.25 trillion worth of liquidity credits which were extended in contravention of the regulations," he said.
Irregularities in the management of the state budget involved Rp 562.6 billion and Rp 1.84 trillion in state companies, according to the BPK report.
The auditors also found irregularities involving Rp 1.26 trillion in the use of reforestation deposits by the Ministry of Forestry and Plantations and off-budget funds administered by the State Logistics Agency (Bulog).
The report pointed out that the dramatic increase in the amount of money involved in irregularities was mainly due to the audit of Bank Indonesia by the BPK on the orders of the House and in line with the government's Letter of Intent to the International Monetary Fund.
Previously, the BPK had never looked into Bank Indonesia's financial reports.
The BPK's audit of the state budget and state companies for fiscal year 1998/99, which did not cover Bank Indonesia, discovered 548 instances of irregularities involving Rp 18.18 trillion.
Among the instances of irregularities found by BPK at state companies were some related to the sale of property belonging to the four state banks which have now been merged into a completely new state bank, called PT Bank Mandiri.
"Asset sales worth Rp 674.2 billion were made without proper prior appraisal and without competitive bidding procedures," Billy said.
He added that the assets sold belonged to former Bank Bumi Daya, Bank Dagang Negara, Bank Ekspor Impor Indonesia and Bank Pembangunan Indonesia.
"Standard state financial procedures require the appraisal by independent valuers of assets which are to be sold and open competitive bids for property sales," Billy asserted.
Referring to an investigative audit being conducted by the BPK on Bank Indonesia, Billy said the special audit would be completed later this month.
"We've already found strong indications of those implicated in the irregularities involving the extension of liquidity credits by Bank Indonesia. But we will leave it to the House and law enforcement agencies to follow up on our findings," he added. (cst)