Ministry issues dog Audit

Thursday November 01, 2018 Written by Published in Politics

Cook Islands government ministries have a real problem when it comes to documentation supporting their figures in official financial statements.


That’s the opinion of Audit Office head Allen Parker, who added poor internal controls and record keeping made auditing “very difficult”.

Speaking at the recent Commonwealth Parliamentary Association conference, Parker told delegates: “It isn’t just one, this is right across the ministries.”

He said there were a number of common issues from audits.

“One of them is delays in submitting financial statements to be audited. In some cases, we have been waiting 16 months.

“One of the other issues are conflicts of interest that have not been managed properly. We are a small island and we have to have a process to handle conflicts of interest better.

“Some of these are not properly documented. So we need to wrap them up in a management report.

“In some cases there is a clear misuse of public funds because of poor internal controls … and misuse of assets. Sometimes you have government assets being used on private properties without actually tracking income received by the Crown.

“The biggest issue is poor record keeping. Sometimes it is very difficult and that is our biggest problem when it comes to sign-off on ministry audits. A lot of ministries cannot demonstrate, or show us, the evidence for spending public money.”

Parker said the last, but not least, problem “is ministries are unable to rectify some of the audit recommendations that have been given over the past three years”.

“So this is something we are hoping to work on with the new Public Accounts Committee. They might be able to give that information for all those ministries who have not been able to address those recommendations over the past three years.  They can demand more accountability from these government ministries.”

Parker says: “We have three functions – our mandatory function is financial audits, our core function, also performance audits as well as special reviews.

“We scrutinise public spending through our financial audit plus any investigations we do.

“We also help government departments and bodies account for how they use public money. “Sometimes we get a lot of flak from members of the public who say the audit office is not totally independent from government because we are employed by government.

“To put things into perspective we (Audit Office and the Public Expenditure Review Committee) have statutory authority to access any information.

We can have access to bank accounts of individuals relating to any misuse of public funds. We can also report it.

“We don’t need consent of Cabinet, or a minister or head of ministry in the department we have audited. However, we do give the ministries the opportunity to comment on the findings of our recommendations.

“We remind them that we will give them 14 days to respond to the audit reports and if we don’t then we give them another seven days and if not then we just table the report and it goes to parliament as is. We will make a little note that opportunity was given to the Head of Ministry, or minister, to comment on the recommendations but we have received nothing.

“So normally we remind them it is in their best interests if they want the audit report to go as is and respond to it, they are welcome to do so.”

“If we do a special review or investigation where we find corruption, or misuse, or fraud, we would highlight sections where we think there have been breaches and pass that to the Solicitor-General’s Office.

“What happens next is based on their recommendations. They might tell us to refer matters to police, once we pass to police it is up to them to decide if they will prosecute.”

Sometimes, Parker said, copies of reports go to donor agencies such as the Asian Development Bank. 

Other special reviews focus on where MPs and the public put in complaints.

“There might be a public interest in a particular matter, once we receive any complaint we pass that on to our PERC committee. They will decide and approve if we will investigate.

“The other thing we look at is the performance audits and compliance audits, which are the other type of audits we do. But they are more limited because of resources. We can only do a maximum of two a year.

“We exist as a safeguard to strengthen accountability, transparency and integrity of government and public entities. That is performed through financial audits which is our primary function.

“And ensuring the effective use of public resources through performance audits.”

Under the constitution the Audit Office is appointed as the auditors of all government departments, state-owned entities, outlying island governments and any other agencies that receive funding from the government.

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