Non-submission of financial statements from Ministries affecting AG’s work

Aug 07, 2014 News

Auditor General (AG), Deodat Sharma in his performance report of the Audit Office for the first quarter (January –March) of 2010, had listed several factors which affect the execution of his work.

Auditor General, Deodat Sharma

Chief among these, were the non-submission of financial statements by some ministries and budgetary agencies.
Six years later, this remains a major factor affecting the AG’s work.
The non-submission of financial statements along with lack of adequate human resources within the Audit Office, as well as the late commencement of audits, resulted in the AG’s inability to meet the September 2009 deadline for the submission of his 2008 report.
This was disclosed during a brief interview with the Chairman of the Public Accounts Committee, Carl Greenidge.
Greenidge said that he recently received the first quarter of 2014 report from the AG which confirmed that these were the issues affecting him.
Calls to Sharma to ascertain why this matter continues to persist, and what action he plans to take in this regard proved futile.
However, in a brief interview yesterday with Former Auditor General and anti-corruption advocate, Anand Goolsarran, he said, “The big question that is before us now, is what action has he taken with regard to the non-submission of financial statements?”
Goolsarran explained that financial statements are quite pertinent to the completion of the Auditor General’s report. He posited however, that Sharma should not “sit back and watch on.”
“He should go out there and let them know that their negligence is affecting the manner in which he is supposed to discharge his functions.”
“He cannot continue to be reactive with this situation. He needs to take action because that has no right being a factor affecting his work,” Goolsarran concluded.
It was recently revealed that the Demerara Harbour Bridge Corporation (DHBC) is four years behind in its audited financial statements, which are supposed to be laid in the National Assembly. Its last such statements were for the year ended, December 31, 2009, and this report was presented only last year.
Chartered Accountant Christopher Ram had described this as a most “unacceptable act.”He went further to state that the Director and the Board of the public entity should be sacked for being so negligent when it comes to honouring its obligations to transparency and accountability.
Audited Financial Statements are monetary reports of a legal entity which have been verified by an auditor. The opinion of the reports is intended to provide assurance that the financial statements are fair in all respects, and give a true and fair view in accordance with the financial reporting framework.
The purpose of an audit is to provide an objective examination of the financial statements. This increases the “value and credibility” of the financial statements produced by management.
Further, the Companies Act of 1991 gives clear guidance on the requirements of government companies and the duties of the Auditor when it comes to financial statements. The Act says that a government company shall submit, within six months after the close of the year, an annual report of its transactions, audited accounts, and the audit report to the Minister.
This annual report, together with the Auditor’s report, shall be printed and laid before the National Assembly within nine months after the close of the year.
Greenidge said that all budgetary agencies should refrain from the practice of having a backlog of reports as it is a “bad sign” and only serves to create problems.
Ram however, contends that the PAC should be moving to recommend sanctions against the defaulting agency.