Durai's answers to the KPMG report
But auditing firm calls former NKF CEO's expenditure, salary
justification 'disingenuous'
After being pilloried in the press and slammed by the KPMG report,
former NKF chief executive T T Durai gave a point-by-point rebuttal
to the various issues raised about him.
Refuting the report's conclusion that he had actually "received
much more while appearing to accept less (pay and bonuses)" through
the use of backdated salary increments, Mr Durai's lawyers
highlighted several factors that should be taken into account, such
as Mr Durai's $210,000 annual income in 1982 as a law firm partner,
his 22 years of unpaid volunteer work since 1971 and his rejection
of the Executive Committee's (Exco) various proposals to increase
his salary.
According to his lawyers' calculations, Mr Durai had in fact
foregone $1.18 million in salary increments since he became chief
executive officer in 1992 "less than he would have if he had
accepted the offer even after taking into account retrospective
increment and bonuses".
The reply added was that "all of Mr Durai's salary increases were
discussed and approved by the Exco".
However, KPMG pointed out that the former board had delegated all
its powers to the Exco, which in turn delegated most of them to Mr
Durai. This appeared to breach the National Council of Social
Service (NCSS) Code of Governance and Management for Voluntary
Welfare Organisations, said the report.
Mr Durai responded that as Exco members and specialised
sub-committee members, the board members were "always involved in
decision-making, acting together with others who had special skills
and an appreciation of the mission and programmes of the
NKF".
This logic was put down by KPMG as "overly-generalised and
disingenuous".
In a defence of former director Matilda Chua's high exit payout
package when she resigned in 2000, Mr Durai said she was
instrumental to the success of the NKF's charity show that year,
and that she had deferred her resignation tendered in January 2000
to run the charity show.
"The June 2000 show was a success and raised $7 million gross. It
was the practice of the NKF in previous years to pay a performance
bonus to staff involved in organising and running a successful
charity show. In accordance with this practice, the NKF paid
Matilda a six-month performance bonus (worth $75,000) in July
2000," he said.
As for what has become known as the "elastic patient numbers", Mr
Durai said his knowledge of these numbers was "entirely dependent
on the information supplied by the Department of Patient
Advancement".
But even as internal requests were made for consistent patient
figures, KPMG uncovered in an email trail that "(Mr Durai) says to
stick with 2,000 patients".
Was a study trip to Las Vegas by a team of nine including Mr
Durai to get ideas for the NKF's charity show warranted?
Mr Durai said public feedback implied the 10-year old show model
was "becoming somewhat stale". Ideas from the trip resulted in "a
fresh new concept" for April 2004's charity show and the NKF Cancer
Show in July, which raised $26 million as compared to the $70,000
invested in the trip, he said.
Responding to botched contracts with Forte Systems and Protonweb
worth a total $7.5 million in the NKF's acquisition of new
technology, Mr Durai outsourced lapses in judgment to the deputy
head of the technology department, Mr Jayaraman.
He also disagreed with KPMG's conclusion that he had authorised
payment of US$320,000 ($532,400) to Forte Systems, relegating the
judgement call to the Technology Evaluation Committee under Mr
Alwyn Lim, vice-chairman of the NKF.
Mr Durai denied knowledge of his role in the NKF's employment of
Forte System's staff and the NKF's application for training visit
passes for two such staff. He said that the signature imprinted on
their covering letters were from a rubber stamp.
While confirming that Mr Pharis Aboobacker was his close friend, Mr
Durai said that he was not involved in the negotiations of the
Forte Software Agreement and the Protonweb BPO agreement. Both
firms were owned by Mr Aboobacker.
http://www.todayonline.com/articles/91213.asp
