29 January 2002
External auditors appointed to look into contract awards
 
The Chairman of the Kowloon-Canton Railway Corporation (KCRC), Mr Michael Tien, said today (Tuesday) that the Managing Board has asked the Corporation's external auditors, KPMG, to conduct a thorough investigation into the Corporation's tender evaluation and contractual performance monitoring systems in connection with the West Rail telecommunications contract.
The decision was made after he had discussions today with a number of members of the Managing Board, following concerns expressed by the media and the public on the issue.
Mr Tien said, "The result of the investigation will enable the Managing Board to take suitable follow-up action to strengthen tender evaluation and monitoring of contractual performance for future projects."
It is expected that the investigation will be completed within eight weeks. The report will be submitted to the Managing Board of the KCRC and Government.
He said he has also learned from the KCRC Management that over the past few years, the Corporation had entered into 27 supplemental agreements for 18 West Rail contracts costing about $1,536 million. This represented about 9.2% of the aggregate of the original contract values.
The external auditors will also be asked to investigate and report on these supplemental agreements.
Mr Tien stressed that under his leadership, the primary objectives of KCRC are to provide quality service to the public and to operate in accordance with prudent commercial principles.