For only the second year since the Cayman Islands government moved to an accrual-based accounting system, public sector entities have managed to turn in financial statements to the auditor general’s office on time.
The government also managed to do so last year, but face exceptional pressures in doing so this time around due to belated budget negotiations that ran into late August.
Cayman Islands Premier McKeeva Bush, who is also finance minister, said meeting the 31 August accounts deadline was a “great accomplishment – especially in light of the further pressures on time that arose from the 2012/13 budget preparation process”.
Typically, central government ministries and portfolios, as well as statutory authorities and government-owned companies, must turn in completed and auditable financial statements within two months of the end of a financial year. The fiscal year for government ends on 30 June, so those statements are generally due on 31 August.
The auditor general’s office has another two months to then review the reports and issue opinions on the financial statements. A formal report on the government accounts is supposed to be submitted by mid-December.
With the exception of this year and last year, that timeline has not been adhered to by most of the public sector entities involved.
Moreover, the information contained in some of the earlier financial reporting was not of an acceptable standard in many cases.
Auditor general Alastair Swarbrick noted last year that roughly half of the audits conducted on government ministries and portfolios from the government’s 2004/05 budget year through the 2008/09 year were either given adverse opinions or a “disclaimer of opinion”.
“Disclaimer of opinion” means there simply wasn’t enough information to even conduct an audit, essentially no way of verifying how the money was spent. An adverse opinion means the entity’s financial statements for the year cannot be relied upon.
Statutory authorities and government-owned companies have historically done much better, with most of their financial statements receiving unqualified opinions, the best rating given by auditors; or qualified opinions, which means areas of concern were identified.
Mr. Swarbrick has not yet commented on the quality of the financial statements submitted to his office for the recently ended 2011/12 budget year.
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