Selangor Journal

Audit report: UiTM risks losing over RM51 mln in failed compensation claims

KUALA LUMPUR, Oct 10 — Universiti Teknologi MARA (UiTM) could potentially lose some RM51.08 million following delays in seeking compensation from 239 scholarship holders who breached their contracts.

According to the Auditor-General’s Report (LKAN) 2021, weaknesses in its compensation claim process against scholarship holders who breached their contracts resulted in RM7.49 million in revenue losses.

Audit findings conducted on 381 of the 1,496 debtors in breach of contract until December 2021 found it involved RM67.08 million.

“The audit found a total of 86 out of 381 debtors in breach of contract with RM6.23 million in total debt value were written off in 2019 by UiTM’s Finance and Development Committee (JKP),” the report stated.

The write-off of debts, amounting to RM6.23 million, was due to the university’s failure to take legal action before the six-year time limit, debtors already being declared bankrupt and the absence of debtors’ files at UiTM’s legal adviser’s office.

In addition, it said that 259 out of 1,496 scholarship holders had breached the contract for failing to complete their studies within the period set in their agreements, with compensation due amounting to RM52.34 million.

“UiTM’s delay in seeking compensation against this group of debtors for breach of contract has resulted in UiTM losing revenue amounting to RM1.26 million and potential revenue amounting to RM51.08 million,” the report said.

The delay in preparing paperwork for the approval of UiTM’s Human Resources Career Development Main Committee (JKI-PKSM) and the absence of several documents related to the breach of contract of scholarship holders were also identified as the cause of the failure to claim damages.

The audit report recommended that UiTM ensure circulars, work procedures and contracts in force are complied with, implemented and efficiently monitored for compensation claims against scholarship holders who breach contracts.

It also recommended the university improve coordination, communication and monitoring of work between UiTM’s Career Development Division, Zone Two Finance Unit, the treasurer’s office and its PUU office, either at the implementation or top management levels concerning legal actions and re-collection of public funds.

— Bernama

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