KCRC executives were yesterday criticised in an auditor's report into a controversial $100 million payment to a West Rail contractor - but the company said no one will be punished over the affair. Instead, chief executive Yeung Kai-yin and two other top managers apologised for their shortcomings in a move described as inadequate by critics. The report by Ernst & Young was commissioned by the Kowloon-Canton Railway Corporation into the payment to telecommunications giant Siemens. Twenty-seven other supplemental agreements with West Rail contractors were investigated. The probe into the payments, worth a total of $1.53 billion, was ordered at the end of January after it emerged that Siemens was paid $100 million above its agreed fees, despite not meeting contract requirements. The report concluded that the decision to negotiate a supplemental agreement with Siemens last October was correct, as its contract was already 10 weeks behind schedule and replacing the firm would have meant further delays. However, senior managers should have informed the KCRC board of the problem sooner. 'The managing board were not made aware [by senior managers] at a sufficiently early stage of the problems on the Siemens contract,' the report said. By the time the board was told of the situation, it was too late to consider alternatives, it said. At a subcommittee meeting of the Legco transport panel, Mr Yeung said he was 'deeply sorry' for not raising the alarm sooner, and had not consulted the managing board on the matter before the situation deteriorated. Mr Yeung was then both chief executive officer - the highest managerial post - and board chairman. 'It is clear that our reporting procedures have not been adequate. I also admit that the chain of reporting . . . was unsatisfactory. For all this I accept responsibility,' he said. Both James Blake, senior director of capital projects, and Ian Thoms, director of West Rail, also apologised for 'errors of judgment'. KCRC chairman Michael Tien Puk-sun, who replaced Mr Yeung in December, accepted the report and believed no one intentionally hid the truth. Mr Tien said the apologies of Mr Yeung and his colleagues were sufficient and suitable punishment. The report's recommendations will be carried out, he said. The probe said the delay in reporting the problem with Siemens to the board could also be attributed to the different criteria used on two sets of internal reports monitoring progress of West Rail contracts. One report, which went to senior managers, raised alarms about the Siemens contract, but the other report, to the board, did not. Mr Yeung received both. Ernst & Young said a similar situation also occurred in two other West Rail contracts involving extra payments. However, the auditors said the KCRC's monitoring procedures compared favourably with industry norms and international practices. Ernst & Young did not identify who should be held responsible for the controversy. Instead, it made several recommendations. They include appointing new directors with specific knowledge and experience of major projects to the managing board, strengthening the role of the board's New Railway Projects Steering Committee and making it meet more regularly. Social and Economic Policy Institute chairman Dr James Sung Lap-kung said it was disappointing the KCRC had not used the row to establish a new model of corporate governance placing more emphasis on accountability. 'It is clear someone has been acting negligently,' he said. Some legislators said that the report should have identified the culprits and also sought punishment. Democrat Andrew Cheng Kar-foo said: 'An oral apology is not enough.'