Gov’t departments say auditors causing delays

Report: ‘Gov’t accounts a mess’

 After being publicly hammered for
not producing annual reports for a number of years, several Cayman Islands government
ministries and portfolios indicated Tuesday that they had turned in the financial
statements needed to complete those reports.

Representatives from various key
government organisations – including the Portfolio of Internal and External
Affairs and the Ministry of Education – said they had submitted many financial
statements months ago.

They told the Legislative
Assembly’s Public Accounts Committee that those records were now with the
auditor general’s office, which had – in some cases – requested additional information
prior to signing off on them.

For instance, the Portfolio of
Internal and External Affairs – which is responsible for all law enforcement
functions in Cayman – told the committee it had submitted statements to audit
for the government’s 2004/05, 2005/06, 2006/07 and 2007/08 years. None of those
reports have been given an opinion by the auditor general’s office.

Consequently, those reports can’t
be finalised and presented to the Legislative Assembly in annual report
documents, as is required by Cayman Islands law.  

The audit office has raised
concerns about this state of affairs for the past several years, since the lack
of audited financial statements and annual reports basically means government
doesn’t know precisely what its accounts look like for any of those years.

Public Accounts Committee
Chairman Ezzard Miller said that the most recent auditor general’s report gave
the impression that government departments were actually worse off now than
they were two years ago when the problem first came to light.  

“The impression that this committee
has been given…is that portfolios like yourself (referring to internal and
external affairs) were in much worse shape than they were,” Public Accounts
Committee Chairman Ezzard Miller said. “It is correct to say that we are not as
far behind…as is stated in this report.”

However, the situation was not as
simple the audit office not completing or signing off on financial statements,
according to Acting Auditor General Garnet Harrison.

In some cases, the financial
information contained in those statements was so poor, that auditors were
unable to give an opinion as to their validity.

“When the submissions are made,
those submissions are not very credible,” Mr. Harrison said. “We end up asking
‘okay, can we really audit these things?’”

“A lot of the problems that exist
on the balance sheet… (are) with what is a receivable and what is a payable,”
he continued.

In some cases, department financial
officers said the discrepancies on financial statements were fairly minor or
involved information so old as to be irrelevant. However, some officers did
admit that it appeared certain people entering data that was later used to
compile financial statements didn’t know their jobs.

“When I got here two years ago,
what I found was the person who was actually doing the transactions didn’t
understand what they were doing,” said Vinton Chinsee, chief financial officer
of the Portfolio of Internal and External Affairs. “The errors that they make
are likely to be passed on to others.”

However, Mr. Chinsee said
government needed to provide more “hand holding” for employees to make sure the
current financial system – created under the Public Management and Financial
Law – was implemented properly.

Others believed that system is a
lost cause.

“You’re dealing with a piece of
legislation that creates a lot of bureaucracy,” said Cindy Scotland, managing
director of the Cayman Islands Monetary Authority. “And I’m not sure what it
gets you at the end of the day.” 

Chairman Miller demanded that both
government departments and the audit office team up to rectify the situation by 30 September. Mr. Miller said, in his view, government didn’t need to spend as much
time producing five year-old reports as making sure the most recent fiscal year
– 2009/10 – had its financial statements done properly.

“We want an end to this,” Mr.
Miller said.

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