Audit delays no problem

Speaking ahead of Wednesday’s Strategic Policy Statement, government leaders have denied that ongoing delays with having government accounts audited could be clouding the Government’s true financial position.

Leader of Government Business Kurt Tibbetts was asked at a Cabinet press briefing Thursday whether he saw a problem with the Government preparing a new budget when an estimated $1.5 billion from previous budgets has not been checked.

‘There is certainly not a situation at any point in time where the government … doesn’t know exactly what the situation is and what expenditure had been incurred,’ Mr. Tibbetts said.

Auditor General Dan Duguay agreed that audited accounts are not needed to determine the government’s bottom line, but cautioned the accounts are needed to provide accountability for government spending.

‘There needs to be a final accountability and that is where the financial statements come into play,’ he said. ‘What the LoGB says is true, but we still need to have those accounts.’

Mr. Tibbetts said Cabinet has been told that all of the late government reports will be up to date by February.

However, Mr. Duguay was more circumspect about how long that will take.

‘The next step in the process is to prepare 2005/06 statements and for larger ministries this could take a substantial amount of time,’ he said.

Accounts trickle in

A trickle of audited government accounts made their way to the Legislative Assembly in recent months after a special AG’s report in July said that government entities were so far behind in submitting financial records for audit that the LA had effectively lost control of the public purse.

Mr. Duguay said Thursday the situation is improving, but cautioned there is still a long way to go.

‘The first step is to identify the problem and work out a plan to improve the situation,’ he commented. ‘I think it is getting better … the willingness and the commitment is improving.’

Some recently released reports seen by the Caymanian Compass, including ones based on the opposition United Democratic Party’s time in office, have contained massive information gaps, in some cases forcing the Auditor General to say he could give no opinion on the statements because of a lack of information.

In a 2004/05 annual report for the former Ministry of Health Services, Agriculture, Aviation and Works, released in October, sloppy record keeping and a lack of information forced Mr. Duguay to conclude: ‘the financial statement do not present fairly, in all material respects, the financial position of the [Ministry] … and its financial performance and its cash flows for the year.’

Mr. Duguay said the quality of many of the 2004/05 reports – the first year that financial reports were subject to a new accounting system – are of sub-par quality.

‘There were obviously problems going through that first cycle. We have identified the majority of the problems. We are hoping when we get the second cycle in (for 2005/06) they will be substantially better.’

Mr. Duguay’s scathing July report variously described the situation with the government’s financial records as ‘deplorable’, a ‘crisis’ and a ‘national problem’, leading Governor Stuart Jack to declare the time for excuses regarding the late accounts was over.

The Public Accounts Committee responded by announcing it would convene hearings in September to force high-paid chief financial officers and chief officers to publicly explain the delays. Mr. Duguay’s report laid most of the blame for the situation on them.

However that meeting was postponed until November to make way for constitutional discussions between the governmental and opposition figures ahead of constitutional negotiations with the UK.

The November date was also cancelled, however, and a new date for the hearings has not been publicly announced.

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