The Commission of Audit has carried out a special audit of the former Provisional Macao Municipal Bureau, and the auditing scope includes control of implementation of budget, statutory compliance, financial management and internal control. Main findings are as follows:

1.1 Former Provisional Macao Municipal Bureau

1.1.1 The budget surplus and bank surplus do not match for a long time. The situation has been simply presented as an unaccountable item waiting to be regularized. However, no follow-up has been made to find out the cause. The budget balance of accounts of year 2000 cannot completely and truly reflect its financial status, and after adjustments, the accumulated balance in the budget accounts is negative MOP 4,746,356.63.

1.1.2 The Bureau has not turned over “vehicle license taxes” according to the appropriation ratio as required by law to the Macao Special Administrative Region and the former Provisional Island Municipal Bureau.

1.1.3 Housing allowance for staff is higher than the legal limit, and the overpaid amount was about MOP 2,722,000.00 in year 2000.

1.1.4 Budgeted expenditure items without statutory support are found.

1.1.5 Management of the treasury activity account has defects, including incomplete records, temporary receipts improperly classified as revenue, and account balance with discrepancy of unknown reason.

1.1.6 Purchasing and tendering works are not performed under an effective system. No guide is provided for procedural instructions. No single dedicated department is designated to handle the work.

1.1.7 There is no explicit and clear guidance on the supervisory system of punctuality and presence.

1.1.8 There is no written supervisory guidance on overtime work. There is discrepancy between the number of overtime hours compensated for staff and their actual number of hours used.

1.1.9 Establishment and operation of the permanent fund do not comply with Decree Law no. 30/98/M, which regulates permanent funds. Moreover, there are expenditures that were paid but not recorded in the accounts.

1.1.10 Cash management lacks an appropriate internal control system, and therefore cannot ensure that cash will be protected under comprehensive measures.

1.1.11 For a long time, staff is employed under the regime of individual contract. There is no well-defined employment regime.

1.1.12 Company credit card in the name of former Provisional Macao Municipal Bureau has been used for paying expenses. There is no legal and reasonable ground for such practice.

1.1.13 There is no strict control on distribution of financial assistance. Different approaches have been used for different subsidized entities.

1.2 Former Provisional Island Municipal Bureau

1.2.1 Projects for private purposes are abnormally found in the construction and engineering expenditure, where MOP 870,246.00 of the public fund is used to pay the furnishing expenses for private properties owned by the President, Vice President and full-time members of the Municipal Executive Committee.

1.2.2 The housing allowance for staff is higher than the legal limit, and the overpaid amount was about MOP 1,230,000.00 in year 2000.

1.2.3 Management of the cashier activity account is not comprehensive. Defects including incomplete records, and records of income and expenses for budgeted activities are found.

1.2.4 There is no dedicated unit to take charge of purchasing procedures. This does not comply with the stipulation in the organizational statute.

1.2.5 There is no written supervisory guidance on overtime work and corresponding supervision procedures.

1.2.6 The establishment and operation of the petty cash do not comply with Decree Law No. 30/98/M regulating the petty cash.

1.2.7 The collection of income and its recording in the accounts lacks an effective management system; therefore it is hard to ensure accuracy, integrality and authenticity. There is no proper internal control system on cash management, and therefore impossible to ensure that cash will be protected under comprehensive measures.

1.2.8 For a long time, a large number of temporary personnel are employed. No well-defined employment regime has been developed.

1.2.9 Company credit card in the name of former Provisional Island Municipal Bureau has been used for paying expenses. There is no legal and reasonable basis for such practice.

1.2.10 Remunerated services have been provided, in an improper way, by the non-profit organization “Association for Employees’ Welfare” of the former Provisional Island Municipal Bureau.