Ministries scolded for tardiness in preparing financial reports
Published:Thursday | January 12, 2023 | 1:14 AM
Auditor General Pamela Monroe Ellis has urged Dunstan Bryan, permanent secretary in the Ministry of Health and Wellness, to conduct a probe into a protracted delay to prepare appropriation accounts.
The recommendation comes against the background of a nine-year backlog in the presentation of the appropriation accounts to the minister and auditor general, covering the period 2013-2014 to 2021-2022.
In the Auditor General’s Department’s annual report, which was tabled in Parliament on Tuesday, Monroe Ellis pointed out that Section 24(1) of the Financial Administration and Audit Act (FAA) stipulates that accounting officers should submit, to the minister and the auditor general, appropriation accounts for expenditure for each financial year within four months after the end of a financial year.
According to the auditor general, the ministry’s failure to submit the appropriation accounts has denied Parliament, the Ministry of Finance and the Public Service and Jamaicans the opportunity to assess the health ministry’s stewardship over the use of the $560 billion in public resources allocated to the ministry over the nine-year period.
Following the audit, the health ministry advised that the appropriation accounts for the nine years have been completed and submitted to the Internal Audit Unit for verification.
The ministry also said that the delay in completing the accounts was due to the challenges with the Fin-Man System Server.
The auditor general has also recommended that the health ministry must ensure that it implements a proper system of internal control to prevent, detect, and correct errors and irregularities and to ensure that appropriation accounts are prepared accurately and in a timely manner.
The Ministry of Finance and the Public Service was also found wanting as it did not submit its appropriation accounts for financial years 2019-2020 to 2021-2022, with approved budget of $208.3 billion.
Monroe Ellis said that up to the time of reporting, the ministry did not submit the reports to her department.
FAILURE TO SUBMIT A SETBACK
According to the auditor general, the ministry’s failure to submit the appropriation accounts has prevented the timely assessment of the implementation of the approved budgets and reflects a breakdown in management’s financial accountability obligation to Parliament.
Turning to “uncleared balances”, the auditor general reported that despite assurances from the finance ministry in previous audits, the ministry “is neither clearing advances nor reconciling its bank accounts in a timely manner. The records showed uncleared advances for the financial years 2019-2020 and 2020-2021 of $46.9 million and $18.5 million, respectively”.
The ministry indicated difficulties encountered in obtaining the invoices to clear both advances due primarily to the closure of the hotels impacted by the COVID-19 pandemic.
In addition, the ministry also indicated that a standardised procedure would be issued to the recipient of the advance, outlining the responsibility and process for obtaining documents to clear the advance.
“Notwithstanding, in the absence of the invoices to clear the outstanding advances, it will not be known whether the amounts advanced were used for the intended purposes and, by extension, whether the Government received value for the amounts paid out,” the auditor general said.
The finance ministry’s tardiness in reconciling official bank accounts was also highlighted in the annual report.
For the period under review, the auditor general found that the ministry delayed the preparation of monthly bank reconciliation statements for six of its bank accounts by up to two and a half years in some instances.
“The ministry’s failure to perform monthly reconciliation of its bank accounts and follow-up on discrepancies in a timely manner increases the risks of financial losses as management will not be able to promptly identify and correct accounting and bank errors/irregularities,” the report said.
The Ministry of Education and Youth was also tardy in presenting its appropriation accounts for the seven-year period 2012-2013 to 2018-2019 and 2021-2022.
The auditor general noted that even though the ministry submitted the appropriation accounts for 2020-2021, the audit could not proceed as the ministry explained that the financial accounts were being adjusted based on the previous audit report for financial year 2019-2020.
She said that the failure to submit the appropriation accounts has denied the auditor general, Parliament and the country the opportunity to review management implementation of the ministry’s $758.3-billion approved budgets over the seven-year period against the country’s policy direction as well as the impact the result may have in guiding approval of subsequent budgets.