Ministry disputes audit findings

The government Ministry of District Administration claimed Friday that an audit on the leases for tenants in George Town’s Royal Watler cruise terminal contained “serious inaccuracies”, although there was apparently no effort to make those “inaccuracies” known prior to the report’s completion.

The findings of the audit were first reported in the Caymanian Compass last month.

According to the Internal Audit Unit’s report, which was released in October 2009, most of the tenants in the Royal Watler cruise terminal in downtown George Town were operating without a lease during 2008-2009, and some had not paid for their accommodations.

A press release sent Friday by ministry chief officer Kearney Gomez disputed this, for all but one of the rental agreements and for the first month’s rent payments at the terminal.  

“Commercial leases were duly executed for 13 of the 14 units between December 2006 and January 2008,” the statement read.

“The final unit remained unoccupied due to planning issues until October 2009. Contrary to statements contained in the (audit) report, no tenant was permitted into occupation prior to signing a lease and paying a first rent cheque.”

The statement then notes that those initially signed leases were not “registered” for up to three years. The Port Authority’s Board of Directors stated in late 2009 that efforts were still under way to collect delinquent rents and that the board was “working with lawyers” to do so.

“Once tenants had been signed up for each unit, the role of the Lands and Survey Department was complete,” The ministry statement read. “Thereafter, the Port Authority undertook to directly manage all Royal Watler units itself, taking full responsibility for all rent collection, rent delinquency, and its own decision to award rent reductions across the board.”

According to Mr. Gomez, the Lands and Survey Department was contacted by the Port Authority to initially help “market and sign up suitable tenants for the Royal Watler retail units”.

Internal Audit Unit reports always contain responses from management of government agencies that are audited, however in this report that response was obtained from the Port Authority, not the ministry or the Lands and Survey Department. 

The Ministry and the Department only became aware of the report’s existence when
the Compass published its article,” a statement from the Ministry read.

In the audit report, two major problems were identified: First, the report stated that only four of the 14 tenants housed at the port terminal area during the government’s 2008/09 budget year had written and signed lease agreements in place. It said five tenants owed rent payments totalling more than $200,000.

Please see more on this story in Monday’s Caymanian Compass….