Gov’t financial reports lack timely release

Though the government and associated authorities are doing a better job of turning in financial statements with quality data, according to a recent report, fewer than half of the completed statements have been made public. 

The auditor general’s office said in a report released Tuesday that of the 41 financial statements compiled for the Cayman Islands government’s 2011/12 fiscal year, including statements for both central government entities and statutory authorities and government companies, 29 have been completed and audited. Yet only 12 of the completed reports had been made public by tabling them in the Legislative Assembly.  

“Timely, accurate and reliable financial information is a fundamental component is ensuring the effective governance and accountability of government and public entities,” Auditor General Alastair Swarbrick said.  

The quality of the audited financial records appears to be greatly improved compared to previous years, when large numbers of government financial statements had to be “disclaimed” – meaning auditors had difficulty making sense of the information submitted for review.  

Ten of the 15 audited statements from the government ministries and portfolios for the 2011/12 budget year received either unqualified or qualified audit opinions, essentially meaning that, with only a few exceptions, the statements were fair representations of the entity’s financial position.  

Nineteen of the 26 financial statements from the statutory authorities and government-owned companies also received either unqualified or qualified audit opinions.  

Twelve of the government entity financial statements had not yet had their audits completed at the time Mr. Swarbrick evaluated the public sector’s progress.  

There appeared to be little reason for the delays in releasing the completed financial statements. For instance, a qualified audit opinion on the Port Authority of the Cayman Islands 2011/12 financial statements that was completed on Dec. 10, 2012, was made public in the Legislative Assembly in March.  

On the other hand, a qualified report completed for the Cayman Turtle Farm on Oct. 23, 2012, had yet to be released. Similarly, financial statements for the former Ministry of Financial Services that received a qualified opinion in June 2012 had not been made public as of the date of the report.  

The dearth of publicly available reporting data has been a sore subject for Mr. Swarbrick over the years.  

“The final step in ensuring the accountability and transparency of the public finances is through the tabling of the annual reports … in the Legislative Assembly,” Mr. Swarbrick wrote in a 2012 report on financial statements. “Accountability delayed is accountability denied.”  

As of that Sept. 30, 2012, evaluation, 71 annual reports or financial statements completed through the 2009/10 financial year required a formal tabling in the assembly. For the 2010/11 budget year, just five of the 27 completed financial statements had been made public in the Legislative Assembly, according to auditors. Since the report was released, many of those financial statements have been made public.  

“In some instances, the time since the financial statements were completed and signed off by all parties is close to two years and in many cases close to one year,” Mr. Swarbrick wrote.  

The Public Management and Finance Law indicates that statutory authorities and government companies should present annual reports to the Legislative Assembly within two weeks of a mandated 31 October deadline or at the first subsequent sitting of the LA. 

For central government, the deadline for presentation to the LA is five months and two weeks after the end of the financial year.