Audit results: Applause yes; ovation, not yet

Shortly after 9 a.m. Wednesday, members of the Cayman Islands media received an electronic missive from the Office of the Premier, announcing that a press briefing would take place 3.5 hours later, featuring Premier Alden McLaughlin, Deputy Governor Franz Manderson and Finance Minister Marco Archer.

What could be so urgent as to require such a hasty public assemblage?
No, the Ebola virus had not surfaced in Cayman. No, the dump was not on fire again. No, the Queen was alive and well. (God save her!)

What officials actually had in mind when they called a convocation of the press (a rarity for this Cabinet) was not a national emergency, or any extraordinary occasion whatsoever – but an impromptu announcement that two of 41 government entities expected to receive “unqualified” audit opinions, the auditor general’s equivalent of a clean bill of health; and that the rest expect to receive at least “qualified” opinions, meaning the auditor general had some significant, but not devastating, concerns about their books.

“This is a huge stride forward,” Premier McLaughlin said.

Indeed, kudos to the Portfolio of the Civil Service (Deputy Governor Manderson’s) and the Ministry of Community Affairs (Premier McLaughlin’s) for obtaining unqualified opinions. That is the benchmark that needs to be met each year and is, as we realize, no easy feat considering the complexity and ingrained cultures of the organizations.

But according to standards for the private sector, nonprofit realm and most First World governments, all the officials really announced on Wednesday was that 39 of 41 government entities either have not, or have not yet, demonstrated adherence to basic accounting practices.

Auditor General Alastair Swarbrick, who was not included at the press conference and who later declined even to comment on what was discussed there, said, “I don’t want to diminish what has been achieved in the past four years in terms of moving things forward, but citizens as users of and payers for public services have a fundamental right of knowing what revenues government has generated for them and how this money has been used.”
As usual when it comes to public finances, and taxpayers’ expectations of government performance, Mr. Swarbrick is right on the money.

Nevertheless, it is good news that all of the accounts are improving and progressing toward, at the least, qualified audit opinions.

Any outcome worse than a qualified opinion – i.e. “adverse” (meaning the government’s numbers are demonstrably incorrect) or “disclaimed” (meaning the auditor doesn’t have enough information to issue an opinion) – should be grounds for termination of the responsible employees.

All of government’s endeavors to “privatize,” “rationalize” or “right-size” – and all the long-term strategic planning in the world – will be discounted so long as government’s financial figures fall short of the highest professional standard.

And so, while we applaud the positive accomplishments of Mr. Manderson’s and Mr. McLaughlin’s respective entities, until all 41 government bodies have met the real standard – unqualified audit opinions – we’ll stop short of a standing ovation.