REPORT OF THE

PUBLIC ACCOUNTS COMMITTEE

ON

REPORT NO. 46 OF THE DIRECTOR OF AUDIT

ON

THE RESULTS OF

VALUE FOR MONEY AUDITS






July 2006

P.A.C. Report No. 46

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CONTENTS
				Paragraph	Page
Part 1	Introduction
	The Establishment of the Committee			1	1
	Membership of the Committee			2	1
Part 2	Procedure
	The Committee's Procedure			1	2
	Confidentiality undertaking by members of the Committee			2 - 3	3
	The Committee's Report			4	3
	The Government's Response			5	3
Part 3	Committee Proceedings
	Consideration of the Director of Audit's Report			1	4
	Meetings			2	4
	Arrangement of the Report			3 - 4	4
	Acknowledgements			5	4
Part 4	Chapter
	1.	Collection of fines imposed by Magistrates' Courts		1 - 2	5
	2.	Maintenance of public marine facilities		1 - 4	6
	3.	Management of the government fleet		1 - 5	7
	4.	Provision of public museum services		1 - 12	8 - 13
	5.	RTHK: financial control and resource management
		A.	Introduction	1 - 6	14 - 15
		B.	Culture of compliance	7 - 23	15 - 22
		C.	Management of departmental contract staff and service providers	24 - 47	22 - 32
		D.	Management of outsourcing activities	48 - 66	32 - 37
		E.	Management of overtime work	67 - 83	37 - 42
		F.	Stores and procurement matters	84 - 88	42 - 43
		G.	Entertainment expenses	89 - 106	43 - 50
		H.	Management of sponsorship	107 - 112	50 - 52
		I.	Conclusions and recommendations	113	52 - 59
	6.	RTHK: governance and strategic management
		A.	Introduction	1	60
		B.	Compliance culture and internal control	2 - 27	60 - 68
		C.	Strategic planning and performance management	28 - 37	68 - 71
		D.	Conclusions and recommendations	38	72 - 74
SIGNATURES OF THE CHAIRMAN, DEPUTY CHAIRMAN AND MEMBERS OF THE COMMITTEE					75
CHAPTERS IN THE DIRECTOR OF AUDIT'S REPORT NO. 46 DEALT WITH IN THE PUBLIC ACCOUNTS COMMITTEE'S REPORT					76
Appendix relating to Part 1: "Introduction"
APPENDIX 1	Rules of Procedure of the Legislative Council of the Hong Kong Special Administrative Region				77 - 78
Appendix relating to Part 2: "Procedure"
APPENDIX 2	Paper presented to the Provisional Legislative Council by the Chairman of the Public Accounts Committee at the meeting on 11 February 1998 on Scope of Government Audit in the Hong Kong Special Administrative Region - 'Value for Money Audits'				79 - 81
Appendices relating to Part 3: "Committee Proceedings"
APPENDIX 3	Witnesses who appeared before the Committee				82
APPENDIX 4	Introductory remarks by the Chairman of the Public Accounts Committee, Dr Hon Philip WONG Yu-hong, GBS, at the first public hearing of the Committee on Monday, 8 May 2006				83 - 84
Appendix relating to Chapter 2 of Part 4: "Maintenance of public marine facilities"
APPENDIX 5	Letter of 7 June 2006 from the Director of Civil Engineering and Development				85 - 86
Appendix relating to Chapter 3 of Part 4: "Management of the government fleet"
APPENDIX 6	Letter of 6 June 2006 from the Director of Marine				87 - 95
Appendix relating to Chapter 4 of Part 4: "Provision of public museum services"
APPENDIX 7	Letter of 7 June 2006 from the Director of Leisure and Cultural Services				96 - 100
Appendices relating to Chapter 5 of Part 4: "RTHK: financial control and resource management"
APPENDIX 8	Statement made by the Director of Audit at the public hearing on 8 May 2006				101 - 102
APPENDIX 9	Letter of 24 May 2006 from the Director of Audit				103 - 109
APPENDIX 10	The overall response of RTHK to the audit review on RTHK's financial control and resource management dated 4 May 2006				110 - 111
APPENDIX 11	Letter of 24 May 2006 from the Director of Broadcasting				112 - 124
APPENDIX 12	Letter of 8 June 2006 from the Director of Broadcasting				125 - 127
APPENDIX 13	Paper for the Finance Committee meeting held on 24 March 1982				128 - 135
APPENDIX 14	Extract from the Half-yearly Progress Report on Follow-up Action on the Government Minute (Position as at 31 March 2000)				136
APPENDIX 15	Letter of 26 May 2006 from the Director of Broadcasting				137 - 144
APPENDIX 16	Letter of 27 May 2006 from the Director of Audit				145 - 152
APPENDIX 17	Letter of 6 June 2006 from the Director of Broadcasting				153 - 164
APPENDIX 18	Letter of 6 May 2006 from the Director of Audit				165 - 166
APPENDIX 19	Letter of 10 June 2006 from the Director of Broadcasting				167 - 170
APPENDIX 20	Letter of 15 June 2006 from the Secretary for Financial Services and the Treasury				171 - 172
APPENDIX 21	Letter of 26 May 2006 from the Secretary for Financial Services and the Treasury				173 - 174
APPENDIX 22	Letter of 10 June 2006 from the Secretary for the Civil Service				175 - 176
Appendix relating to Chapter 6 of Part 4: "RTHK: governance and strategic management"
APPENDIX 23	The overall response of RTHK to the audit review on RTHK's governance and strategic management dated 4 May 2006				177 - 178
ACRONYMS AND ABBREVIATIONS					179