4.5.8 Inadmissible Accounting Records, 2014
The Audit observed that the Fund used excel spreadsheet to maintain its records instead of a reliable accounting package. There was no consistency in the recording of manual and excel ledgers, resulting in eight manual ledger records reflecting a total of $2 457 581, which was not posted to excel ledger accounts, while sixteen excel ledger accounts had expenditure amounting to $2 092 206, which was not posted to the manual ledger. The fourteen ledger accounts which were maintained in both manual and excel ledger accounts, separately, had variances amounting to $1 930 756. There is a risk that inconsistencies in recording financial transactions may result in materially misstated financial statements and failure to reconcile manual and excel records could result in failure to detect errors and fraud.
The Permanent Secretary indicated that they have adopted a pastel accounting version 14. He also indicated that the figures were reconciled.
The Committee was concerned with the extent of poor record keeping that was prevalent in the Ministry and the inaction by the Accounting Officer as these issues are reported year after year.
4.5.9 Trade Receivables that could not be ascertained
The Audit could not ascertain the existence, accuracy and completeness of trade receivables amounting to $1 201 012 as the Fund did not maintain detailed individual debtor records. There were no debtor reconciliations carried on throughout the year. One agent of the fund understated sales for the month July, 2014 by $46 493 thereby under remitting revenue by the same amount.
The Ministry indicated that individual debtor records were now being maintained and reconciliations were being carried out. The Committee was however, concerned about the weak controls in the Ministry which can possibly lead to fraud if no action is taken to address the issues.
4.5.9.1 The Committee recommends that the Ministry should, by 31st August 2017, submit to Parliament evidence of reconciliations and individual debtor records being maintained.
4.5.10 Absence of a Management Committee to administer the Fund
The New Number Plate Revolving Fund Constitution Section 3 (a) states that the Fund shall be administered by a Management Committee appointed by The Accounting Officer who shall be responsible for the day-to-day running of the Fund. The Fund has been operating without a Management Committee since its inception. In the absence of the Committee, decisions taken by Management may not be independent as has been demonstrated in this Report.
In his response to the observation, the Permanent Secretary regretted that the requirement of setting up a Management Committee was not fulfilled. He has made an attempt to set up one such Committee but he indicated that the Committee was not operational as the Chairman was pursing part time studies.
The Committee noted with concern that there was a deliberate effort by the Permanent Secretary to downplay the need of a vibrant Management Committee to administer the Fund. The challenges besetting the Fund are just numerous to guarantee and instil public confidence that there is proper safeguard and management of public resources under this Fund. The Fund is rather a cash cow for the Ministry which is not the intent and purpose for which it was set.
4.5.10.1 The Committee recommends that the Ministry should, by 30th September 2017, put in place a viable Management Committee to administer the Fund and demonstrate ample evidence that the Committee is now in charge of the affairs of the Fund.
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