The City University of Hong Kong (CityU) Students’ Union has said it faces “the largest crisis since its establishment,” after the university demanded that it hand over 16 years of audit reports within two weeks and warned of possible punishment if the union did not comply.
In a statement released on Sunday, the student organisation said it had received a letter from the Student Development Services (SDS) of CityU saying that the university was “extremely concerned about the union’s inability to provide the audit reports from 2005 to 2020.”
According to the union, the university said it may take back its premises and stop the organisation from using “City University of Hong Kong” in its name if it failed to handover the related reports on February 5.
CityU told InMedia that the school had signed an agreement with the student body in August 2020, requiring the union to submit the audited financial statements before the end of last year.
The university said it had not received the statements and the SDS was investigating the matter.
CityU questioned how representative the union was of the university as it was registered independently from the university but “acted under the name of CityU Students’ Union.”
The university also said that as around 80 per cent of undergraduates were not members of the union, the SDS was reviewing the distribution of student activity rooms to reassign campus space more fairly.
The CityU Students’ Union was established in 1985, one year after the founding of CityU.
In August 2020, the university announced that it would no longer collect members’ fees on behalf of the union, because the union operated independently and its accounting was opaque.
Venus Yau, acting president of the CityU Students’ Union, told HKFP that the SDS said in a recent email there were external concerns regarding the union’s accounts, referring to an Oriental Daily news piece published on January 16.
According to the article, two groups had reported CityU Students’ Union to the city’s anti-graft watchdog for poor financial management and false accounting two years ago, while the university said it had had concerns about the financial situation of the student organisation for many years.
However, before refusing to collect members’ fees, Yau said the university “should have a clear picture of the union’s accounting situation”, adding that “the Finance Office [of CityU] was signing cheques for the student union’s expenses.”
Yau also told HKFP that the school had not asked the union to submit any audit reports before the agreement was made in August 2020.
The union’s statement on Sunday said the Societies Ordinance did not require the organisation to “perform independent annual auditing” and it had employed accountants to audit its accounts in the early years.
“We have already complied with the requirements and found accountants,” Yau said. The audit firm had told Yau that the full audit for all 16 years of accounts could not be delivered until April this year.
As the deadline set by CityU was shortly after the Lunar New Year holidays, Yau said it would be impossible for the auditing firm to finish the work on time.
According to the union’s statement, they had reported the auditing progress “immediately” and “proactively” to the university after receiving the information in December but had received no response.
Separately, the union also said that it had been accused by the Facilities Management Office of a “rat situation” in the students’ union office, as well as unregulated use of the space by students. The Facilities Management Office said it would formally advise university management to revoke the union’s right to use the office.
The union said the school had ignored its follow-up actions, which included putting rat traps in the office and requiring organisations under the union to perform regular cleaning.
It also said regulations on students’ use of the office were in place and there had been no breaches of the rules in November and December last year.
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