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NDIA handled $12B in four years; but had only one internal auditor
The state-run National Drainage and Irrigation Authority (NDIA) reportedly spent over
Some of the drainage and irrigation structures in Black Bush Polder, East Berbice.
$12B in capital and revenue expenditures over the past four years but its Internal Audit Unit had only one person to monitor how monies were spent.
“The Internal Auditor is inadequately resourced given the level of expenditure incurred; it is not possible for one person to monitor the effectiveness and efficiency of internal controls over the financial operations. This is clearly demonstrated throughout this report with the many red flags and breaches identified,” a key forensic audit report that was released this week said.
The report flagged the erroneous reporting of the Internal Auditor to the CEO who “showed little or no interest in the internal controls, generally. This was evidenced by the multiple breaches identified in this report.”
The forensic audit was one of several ordered last year into the operations of state agencies, after the David Granger government took office in May.
Auditors found that NDIA never prepared its own accounts since it was incorporated by the Act of Parliament in the mid-2000s.
The forensic audit report, released Friday by the Ministry of Finance, zeroed in on one big annual expense for NDIA- to the Water User Association (WUA).
WUAs are non-profit business organizations of rural residents and farmers to perform maintenance of drainage and irrigations structures for agricultural production and for rural housing areas.
In early 2004, the report explained, nine water users’ associations were established across the country- each registered as a separate entity with its own constitution, board and management.
“It is important to note that water user associations collect fees from farmers for provisions of services and are expected to be financially sustainable as business entities.”
Auditors found that WUAs received, over the period January 2011 to June 2015, the sum $1.1B, of which 53% of the funds were expended in Region Six (East Berbice area alone).
“None of the associations have prepared annual financial reports or have financial statements audited for the years 2011, 2012, 2013 or 2014. The last financial audit was done in 2010 despite the amount of funds received over the years. Quarterly financial reports are prepared but none were available for examination.”
The report said that there were serious allegations of corrupt practices in some associations including mismanagement of finances and absence of regular statutory elections.
“An NDIA board meeting held on June 8, 2012 members requested that all WUA’s prepare audited financial statements as there were many reports of mismanagement. No financial audit was done to date despite the request made by the Board.”
Special investigations were done by then Field Auditor, Pablo Singh, on July 2, 2012 at Black Bush Polder WUA and on August 22, 2012 at Charity/Zorgen Zlygt WUA where significant malpractices were discovered.
“While we were unable to confirm the accuracy of these reports in the absence of the supporting documentation, we noted that at Black Bush Polder (BBP) WUA management converted in excess of $7 million of the BBP WUA funds to their personal use in various schemes.”
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