AG blames record keeping

National, Normal
Source:

The National, Thursday 6th June 2013

 POOR record keeping, the nemesis of all government departments continued in the Department of Community Development in 2010.

The audit of accounts of the department by the Auditor-General was tabled in Parliament by the Parliamentary Public Accounts Committee in February this year.

The report records a litany of errors, omissions, commissions and neglect that are contrary to established processes for public accounting and in many instances contravene laws.

When the audit compared the expenditure summary of the department generated by one set of records called the Treasury Management System (TMS) against another set called the PNG Government Accounting System (PGAS), there were variations in excess of K4.843 million when both records are supposed to check against each other with no variation.

Examination of the TMS showed total appropriation of K9,838,200 while the department’s PGAS revealed total appropriation of K14,835,800, leaving an unexplained variance of K4,843,981.

The department’s expenditure report showed no expenditures while treasury management system showed that 65% of development funds from donor sources totalling K44,748,183 were already spent.

The confusion state of the accounts is continued with the department’s bank reconciliation, with its procurement and payment procedures and with its trust accounts.

Bank reconciliation records examined showed unpresented cheques amounting to K278,741. Credit in the bank but not recorded in the cash book amounted to K2,023,136. The cash book was overdrawn and the reason worked out by the audit team was that the department was not posting into the cash book reimbursements from Waigani Public Account on a timely basis or not at all.

Examination of the procurement and payment procedures in the department revealed many discrepancies.

In one instance a driver was paid K33,314 out of a total settlement of K64,287 but there was neither court order or secretary’s approval to support this settlement.

In another an employee’s leave fares totalling K20,010 was paid, but included in the airfares were four dependents over the age of 18 years with the oldest aged 32. Clearly nobody checked or the airfares were approved in violation of approved levels.

Payment vouchers totalling K248,196 were not supported by documentary evidences to substantiate the payments.

The department operated 19 trust accounts, all outside the government accounting system.

Trust instruments for all 29 trust accounts were not sighted. End of year balances for 15 of the trust accounts were furnished without bank statements or bank reconciliations.

Similar discrepancies were discovered in the audit of Advances Management.

The audit did note that some improvements had occurred in the operation of controls but weaknesses continued which undermined the department’s ability to discharge its goal to take charge of issues of social concerns of the community and advocating the rights of less advantaged citizens such a women and children.

A letter from the auditor-general highlighting its findings were sent to the department top management but it failed to respond as at June 2012.