The 442-page report, commissioned by the new NKF board and conducted by accounting firm KPMG, said the charity's main failing under its previous board and management was "a lack of meaningful governance".

It cited poor management and "even questionable ethical conduct", according to statements published on the NKF's Web site.

The charity, which counts on donations from the public to subsidise treatments for kidney and cancer patients, raised over S$70 million in donation income in 2004.

But it faced widespread criticism in July when its then chief executive officer T.T. Durai admitted in court that he earned S$600,000 annually (US$360,400), and used NKF funds to pay for first-class travel expenses and other luxuries.

"The NKF appeared to run and operate, and in fact did run and operate, on the ideas, whims and caprice of the chief executive," the KPMG report said.

Durai was forced to quit amid public outrage over his salary and spending habits, which included gold-plated office bathroom fittings.

The NKF, which had launched a libel suit against the city-state's main media company when it reported on Durai's spending, later dropped the suit after Durai conceded in court that neither he nor the NKF had been defamed.

The KPMG report said the NKF used inflated or misleading figures in its press releases and fund-raising materials relating to numbers of kidney patients, patient subsidies and treatment costs.

Only about 10 cents out of every charity dollar went towards subsidising patients' direct treatment costs in 2003, KPMG said. An NKF investment report in 2004 had said that "out of every dollar raised in 2003, $0.52 went to beneficiaries and programmes for the year".

The new board aims to increase the amount spent on dialysis in its fiscal year 2006 to at least 41 percent of charity income, the NKF said. It also plans to spend at least 70 percent of total expenses for the year on dialysis patients.

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