Auditor to look into ‘risky’ spending

In retrospect, the government
agencies that did the worst at financial reporting over the past several years
appear to be former government’s ministries, the Portfolio of Internal and
External affairs and the former Portfolio of Finance and Economics.

According to Auditor General
Alastair Swarbrick, none of the current government ministries has completed
financial statements for the 2009/10 budget year either.

The financial statements turned in
by the former ministries and portfolios were all given adverse opinions or
disclaimers of opinion by Mr. Swarbrick’s office, except in the case of the
former Portfolio of Finance, which hasn’t had completed audits of any financial statements
since 2005.

“We can’t get information to
actually reach opinions on these audits,” Mr. Swarbrick said, referring to the
government ministry financial statements between 2005 and 2009. “[The Portfolio
of] Finance and Economics, in terms of what’s been signed off, it’s the
furthest behind. That would be a concern to me.”

In 20 years of public sector
auditing in the United Kingdom, mainly in Scotland, Mr. Swarbrick said he has
never had to give an adverse opinion or disclaimer of opinion – which
essentially means the data provided is useless –
in any audit.

For government ministry financial
statements in the years between 2004 and 2009, there were five adverse opinions
issued by the audit office and 17 disclaimers of opinion 

“[For those years] we can’t
actually reach a view about whether the money has been spent appropriately,”
Mr. Swarbrick said. “It could have been…but they can’t provide us with the
evidence to say that.

“From my perspective, that’s not
being accountable to the electorate as to how you’ve used their public funds,”
he said. 

If some misappropriation of funds
had occurred, audit officials said, it would be more difficult to detect as
well.

Not giving any indication that such
a thing had happened, Mr. Swarbrick said his office did intend to look at some
of what he called “potential risks” in some of the expenditures detailed in the
financial statements between 2005 and 2008.

“We are aware there are some areas
of expenditure where there [are] potential risks….what we’re planning to
actually do is to do some independent compliance audits to review certain risk
audits for this period,” he said, “for areas where we consider the transactions
to be a bit riskier.”

This can’t happen, however, until
the audit office can clear up the current backlog of government financial
statements. The process could be completed as early as June, but Mr. Swarbrick
acknowledged it could take as long as 18 months to two years unless he gets the
appropriate support from government agencies.   

No PAC

One area that may affect public
accountability reporting is the current lack of a functioning Public Accounts
Committee. Its chairman, Ezzard Miller, resigned last month.

Premier McKeeva Bush has said no
replacement chairman would be appointed until May.

“I do have a concern [about that],”
Mr. Swarbrick said. “I think the reason we’ve seen some traction and progress
with that in the last six, 12, 18 months is because of some strong leadership
in terms of the PAC….holding people actually accountable in the public
arena…and that’s why we’ve made some progress, I think.

“If that’s no longer there, I do
have a concern that people will no longer be as proactive because there’s no
one holding them to account in a public arena.”

Another issue that could arise
without a Public Accounts Committee is that the auditor general officially has
no one to approve his office’s expenditures – including staff salaries.

“We’re OK at this moment in time,”
he said. “But it will become an issue [in] May, June-time if we can’t get our
bills paid. But I’m sure we can find a way to get around that.”

Mr. Swarbrick said in addition to
the annual financial statements, his office is working to complete two reports
on government’s procurement process and Cayman’s overseas medical payments.
Those two reports should be out by June and shouldn’t be affected by the lack
of a functioning Public Accounts Committee, he said.

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1 COMMENT

  1. Mr. Alastair Swarbrick,
    I humbly draw your attention to the recent tenders for new classroom blocks publicised on the Education Ministry’s website. I have had a look at these documents and conclude that the government in between 6 to 8 months will be hit with numerous claims whereby the cost of these projects will alomost double. It is quite bewildering that there documents have been let out for public tender without the proper. MOre so in the light of the Tom Jones current claims case and the Government need to curb spending.

    Please note this as a heads up that someone said this before the the event. Prevention is better than cure.

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