An Audit Remark on Malaysian Local Authorities Immovable Asset Management

Abstract

The management activities of the local authorities were audited to evaluate whether the planning of programs and activities was carried out successfully within the stipulated period, without any wastage. Generally, any issues or weaknesses of activities will be revealed by the audit. Thus, the outcome of the audit will assist local authorities to take corrective action on the issues raised so that value for money could be obtained. The objective of this paper is to review what are the issues that frequently be raised by the audit on local authorities’ immovable assets. A total of 13 projects were reviewed through the Auditor General Report on the activities of State Government Department and Agencies from 2011 to 2013. The review only involved projects on local authorities’ immovable property. Document analysis method was used to know the evaluation done by the Malaysian National Audit Department of the local authority property management over the years.Out of 13 projects being reviewed, it can be concluded that there were seven main matters that have caused a lot of money being wasted for namely high arrears of rental and tax revenue, poor maintenance, vandalism and theft activities, delayed project, poor documentation, record and system, abandoned and unutilized asset also weak monitoring and enforcement by the council on property. Factors were interrelated to each other make more money to be spent in managing a property. In conclusion, property management in Local authorities is still in unsatisfactory level. Comments issued by the National Audit Department may be a best guideline for improvements. This paper proposed further research to be undertaken into property management issues based on category of immovable property.