An audit report has shown that the Addu City Council spent MVR 1.2 million in 2023 and 2024 on overseas trips conducted in violation of government circulars.
The Auditor General's Office today released the reports following audits into the financial statements and compliance with laws and regulations of the Secretariat of the Addu City Council for the financial years ended 2022, 2023, and 2024.
The audit report stated that although Addu City Council's financial accounts are generally accurate, a significant number of actions in breach of the State Public Finance Regulations were committed in the administration of the council, such as failing to conduct procurement transparently, failing to monitor agreements, failing to recover outstanding funds from leased lands, and more.
Expenses of the overseas trips
- 2023 Study Tour to Malaysia and Singapore: A total of MVR 515,101 was spent from the council's budget for this trip, which consisted of 10 participants. Out of this, MVR 65,381 was spent on an event management course that had no connection to the purpose of the trip. Furthermore, written details on how the outcomes achieved from the trip would be utilized were not maintained.
- 2024 Study Tour to Malaysia and Singapore: A total of MVR 685,509 was spent on this trip by the Women's Development Committee. Out of this, MVR 116,286 was spent from the budget for the accommodation and travel expenses of the Secretary General and a council member who did not participate in the trip's training. These are major expenses incurred in violation of the circulars issued to reduce state expenditure.
Additional issues highlighted in the report
- Although the construction of the fish market in Maradhoo ward was contracted to a private business in December 2021 for MVR 3.3 million to be completed within six months, the work had still not been completed by February of this year.
- Out of the projects contracted in 2020 to establish fish plants in Hithadhoo, Maradhoo, and Hulhumeedhoo, only the Hithadhoo fish plant had been completed and opened by February of this year. The work on the Maradhoo and Hulhumeedhoo fish plants remains incomplete and heavily delayed.
- In a manner that compromises competition, procurements that are considered to be a single item were split up to keep them below MVR 35,000, incurring a total expenditure of MVR 512,733.
- During the years 2022 and 2023, quotations for procurements totaling MVR 292,620 were obtained from a connected third party.
- By December 31, 2024, MVR 13.95 million due from leased lands had still not been received. Out of this, the total outstanding money accumulated from 54 plots of land where rent had not been paid for a long period stands at MVR 7.65 million. Since the council has not properly maintained the accounts, its accuracy cannot be verified.
- The size of plots allocated for tourism purposes was increased to a total of 166,340 square feet without any announcement being made.
- Due to re-granting the previously given two-year grace period in land transfer agreements to other parties, the City Council suffered a loss of MVR 5.58 million.
- MVR 492,533 received as income by the City Council was not deposited into the Public Bank Account.
- Utilizing MVR 1.87 million under a conditional grant, date palms were procured, and 100 palms were planted by cutting through the asphalt of the pavement on the Link Road in Maradhoo ward. This caused the pavement to be damaged to the extent of being unusable, eroded the soil, and required the council to incur additional expenses to rectify these issues.
In the audit report, Addu City Council was advised to properly maintain records of the funds due as rent from lands, take measures to recover funds from non-paying parties, and deposit income funds into the Public Bank Account without delay.
The audit report also advised compiling and publishing the expired Addu City Development Plan and Financial Plan with public participation as soon as possible.
