Guyana’s Integrity Commission should move beyond the mere submission of financial reports of senior public servants and politicians and add investigating the declarations to see if they match with the opulent lifestyles many officials live, former auditor general Anand Goolsarran has said.
“With the assistance of experts, it should critically examine all declarations and carry out whatever investigation it considers necessary to ensure they are complete and accurate and there is no mismatch between the declarations and the observable lifestyles of public officials,” he wrote in his “Accountability” column published today.
Pointing to outlines set by world international watchdog body Transpa-rency International (TI), he said that the organisation notes that public officials must be held accountable for accurately reporting their assets, as mandated by law. Requiring asset declarations, along with effective monitoring and enforcement, is key to identifying conflict of interest and fighting corruption.
“TI further stated that: (i) while the failure to disclose assets does not automatically imply corruption, it is essential that any irregularities should lead to thorough investigations; and (ii) the Executive’s overwhelming control over the legislature in Jamaica weakens Parliament’s oversight ability, creating an environment where abuse and corruption can thrive,” Goolsarran wrote.
He pointed to global cases of public officials being cited or interdicted for corruption, along with some currently under the spotlight. Last week, he had highlighted the case where the Chinese authorities imposed sanctions against one of the big four accounting and auditing firms, PwC, for its failure to detect and report fraudulent transactions involving a failed property developer.
According to China’s Ministry of Finance, Goolsarran said, the auditors were aware of material misstatements in the financial statements of the developer but failed to point them out, and even issued false audit reports. PwC was the auditor of the developer for the past 14 years which raises the important issues relating to audit independence, cosy relationships between auditors and their clients, conflicts of interest, and the provision of non-audit services at the same time.
New York Mayor Eric Adams has been indicted on five criminal counts in a corruption probe involving soliciting bribes from wealthy foreign business people as well as receiving illegal campaign contributions from foreign nationals, Goolsarran pointed out. “The bribes include US$100,000 worth of luxury international travel and at least one from a Turkish government official. Prosecutors alleged that Mr Adams pressured government officials into approving paperwork for … a Manhattan skyscraper that houses the Turkish Consulate.”
Nearer, in the region, he referred to Jamaica’s Inte-grity Commission which two weeks ago presented a report to Parliament in which it raised serious concerns about the 2021 financial declaration of Prime Minister Andrew Holness.
“The commission alleged that Mr Holness omitted bank accounts from his declaration and had an unexplained increase in his net worth of J$1.9 million, equivalent to US$12,000. The commission also disclosed that three companies linked to the Prime Minister filed tax returns showing no taxable income, despite conducting transactions worth hundreds of millions of dollars. Additionally, one company wholly owned by Mr Holness was being investigated for a loan issued to it in the amount of J$50 million, equivalent to US$310,000,” Goolsarran stated.
Of note too was that the Prime Minister has disputed the commission’s findings which have been referred to the Financial Investigations Division for further investigation.
“The Director of Corruption Prosecution has indicated that there is not enough evidence to press charges against Mr Holness in relation to the filing of an incomplete declaration,” he said.
He said that the AG here had boasted that this was the fourth consecutive year that his report was presented within the statutory deadline of 30 September.
While acknowledging the importance of having timely audit reports, he said, “We have always cautioned against compromising on the comprehensiveness and quality of the audit in order to meet set deadlines. In today’s article, we explore the topic with specific reference to the auditing of Guyana’s public sector.
“The public accounts of Guyana do not relate to central government activities alone. By Article 223(1) of the Constitution, they include: (i) all central and local government bodies and entities; (ii) all bodies and entities in which the state has a controlling interest; and (iii) all projects financed by way of loans or grants from a foreign state or organisation. We raise this because during its scrutiny of the public accounts over the years, the Public Accounts Committee (PAC) has been examining central government activities to the exclusion of those of bodies forming the wider public sector. The latter comprises 180 entities: 39 public enterprises, 61 statutory bodies, 10 municipalities, and 70 neighbourhood democratic councils,” he cited.
As such, the PAC’s approach serves only to encourage the Audit Office to pay less than the desired attention to non-central government activities which are perhaps in greater need of audit scrutiny and reporting, Goolsarran reasoned.
“Examples include the Guyana Sugar Corporation, Guyana Power & Light, National Industrial and Commercial Investments Ltd, Mahaica-Mahaicony-Abary Agricultural Development Authority, Guyana Water Inc, and the Georgetown City Council. There are numerous sets of financial statements sitting in the Audit Office waiting to be audited and reported on, especially in relation to local government bodies. While there is some form of reporting on the accounts of some of the non-central government entities in the Auditor General’s report, it is restricted to audits that have been completed for the period reviewed,” he said.
“In the circumstances, the report does not give a full and complete picture of the status of the results of the audit of all entities forming the wider public sector, which is a significant shortcoming. To ensure the proper and timely accountability for the use of all public resources, which it should be noted belong to the taxpayers of the country, it is highly desirable for financial reporting and audit of all non-central government activities to run in parallel with those of central government. In this regard, legislators have a crucial role to play in ensuring that this is so,” he added.
He said that they must demand from all state-owned/controlled entities in receipt of funds from the Treasury, full accountability in the form of having up-to-date audited financial statements that reflect a “clean bill of health”, as a condition for further funding via the National Budget.
Failure to do so, he noted, “would be considered a dereliction of duty to the public.”
The former auditor general said that respective legislations provide for the audited accounts of public enterprises and statutory bodies to be presented to the National Assembly within six months of the close of the year. However, it is not clear how many of these 100 entities have complied with this requirement.
As regards local government bodies, he said,“the ten Municipalities and the 70 NDCs are required to prepare and submit to the Auditor General financial statements within four months of the close of the year. The Auditor General audits these statements and issues his reports as soon as practicable thereafter. He is required to give the Treasurer one month’s notice of his intention to conduct the audit, and within 14 days, the Treasurer must publish a notice to this effect. The notice must state that interested persons have the right to inspect the financial statements as well as to make representation to the Auditor General as to the correctness and legality of the accounts, including the entries therein.
“Within one month of the completion of the audit or as soon as possible thereafter, the Auditor General is required to submit his report to the municipality or the NDC, with a copy to the minister. Upon receipt of the report, the Treasurer must publish a notice to this effect, indicating that the report is open to inspection for a period of 28 days,” he added
In Guyana, he noted that last year,“there were 88 sets of accounts still with the Audit Office in respect of the municipalities, of which 25 relate to the New Amsterdam Town Council, which was last audited [up] to 1996. Similarly, Rose Hall Town Council was last audited [up] to 1998, with 22 sets of financial statements with the Audit Office.”
