CHAPTER 3 Budgetary Processes 2 A development project such as the rural community complex requires much planning. Discuss what are the factors that the government may consider when deciding to engage in this project. 3 Explain the possible damages suffered by MMM Berhad from the contract termination. Do you think MMM Berhad would win if the company decided to sue the government due to the termination of the contract? Explain how the government should deal with the cost overrun. REFERENCES Accountant General's Department of Malaysia (2012). Sistem Perancangan dan Kawalan Belanjawan https:/ /km.anm.gov.my/Lampiran%20Artikel/eSPKB.74 Public Sector Accounting WEB-BASED ACTIVITIES rise ofthe Malaysian fleet government's 2 Treaty Dicame whether they is enough inhamilton 3. Search and download the latest performfire men by ite Bit of Allair department Idem , the areas which require performance enhancemmis In the plication Recommend the performance enhancements that will improve the publi acci, CASE STUDY Building for the future Three years ago the government entered into a contract with MMM Berhad to build a community complex at a selected rural area. The idea was to develop an integrated complex that will accommodate classes for the local community, a sports arena, a recreation area. laboratories, a library, a mini theatre, a cafeteria, a common hall, a business centre, consultation and counselling rooms, and offices, various programmes were planned to be carried out at the complex, including career and technical classes, seminars and discussion forums,/The project is part of a master plan to expand community centres within the country. The project was supposed to be completed within two years. At the start of the project, additional plots of lands were acquired because the reserved land was too small for the project. The construction of the complex also faced resistance from squatters. The squatters claimed that they have occupied the land for more than 25 years and have developed sustainable livelihood. Relocation would cause them to lose their current way of life and increase their cost of living. After several meetings that took place over two months, the squatters consented to be relocated. The government agreed to pay each family RM2,500 in an ex gratia package and RM300 in monthly compensation. Thirty-eight families were then relocated to an apartment complex. However, the project suffered problems which caused numerous delays and cost overran by RM3.4 million, resulting in the termination of the contract with MMM Berhad. Another company, HGL Berhad, was then appointed to take over the project, MMM Berhad claimed to have completed 80% of the work and delays were due to late approval of design, delays in the handover of the land and disputes over company. a variation order. MMM Berhad threatened to sue the government for the damages incurred by the Ten months ago, the state government issued a stop-work order on the project. The state government claimed that the project was an environmental hazard, The clearing of the land to build the complex caused landslides in the nearby villages, The construction was delayed for another month to allow for nstallation of retaining walls, Case Study Questions Identify the parties who are accountable in terms of the finances, management and programmes related to the project.)