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State enterprises still lax on financial reporting

by Marlon Madden
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It is a month shy of two years since the Public Finance Management Act has been passed in Parliament, but several state agencies are yet to present up-to-date financial statements, Minister in the Ministry of Finance Ryan Straughn has told Barbados TODAY.

But in giving an assurance that this and other objectives under the law were not lost on Government, Straughn reported that outstanding financial reporting of Government agencies will soon be presented.

Straughn said key training of accountants and other changes relating to public finances and procurement procedures should be in place by the start of the next financial year, in April 2021.

The minister said: “This year has been a little bit of a wobble because we had to focus on ensuring that we manage the pandemic, but we haven’t lost sight of the fact that there are a number of key objectives under the Public Finance Management Act that we need to deliver, and we are continuing to work with ICAB (Institute of Chartered Accountants of Barbados) and others to be able to help facilitate that.”

Straughn was responding to a question from Barbados TODAY on Thursday during a brief presentation of a $15,000 cheque by the Institute of Chartered Accountants of Barbados to Government’s Adopt-a-Family programme.

Among other things, the Public Finance Management Act, which was introduced to help Government ensure greater accountability of all its expenditure, forms part of the overall plan to improve governance across central government and state-owned enterprises, he said.

The new bill requires all Government departments and state-owned entities (SOEs) to submit financial reports at least twice per year.

Straughn said: “There is a grid that we have been developing that we can put out now that will say ‘each SOEs are up to this point’. But we have been working to close the gap with respect to bringing those up to date.

“We are working to ensure that we can do that by the end of this financial year where we are only outstanding maybe to 2018 or 2019 on a few key institutions, but the reality is that what we have recognized, and we have started to discussed, was not just the training as it related to corporate governance, but equally with respect to training within the context of government across the board.”

Successive Auditor General reports over the past several years have highlighted key issues in state entities over the years ranging from incorrect procurement procedures to questionable account practices.

The Government’s chief auditor has also been highlighting the tardiness in a number of state entities to have up to date financial reports. Some agencies have not published a financial report from as far back as 2014.

As part of the efforts to improve public finance management procedures, the Mia Mottley administration has been working closely with officials from the ICAB and the Auditor General’s office.

Straughn said through that partnership a “government accounting service” was being contemplated that would see lead accounting officers across central government and state enterprises being trained.

He said under this plan, the training would be consistent and the leadership being provided by the lead accountants in the SEOs and central government would be “as uniformed as can be”.

The Ministry of Labour is expected to take the lead on the training through partnerships with ICAB and stakeholders.

Straughn said while aspects of the training for financial controllers were still being worked out, a lot of the initial work has already been done including an assessment of individuals across central government by the Director of Finance, in an effort to streamline the process and allocate individuals where they are needed, and to ensure the appropriate standards are in place.

He said it was Government’s intention to “fix the issues” that are often highlighted in the Auditor General’s report “so that when the Auditor General reports and people read it they are bored”.

“That is where we are trying to get to so that it is almost by second nature that people understand the institutions are following their mandate,” said Straughn.

“It is important that with the uniformed government accounting service, that the training for accounting officers across the service is as uniformed as possible such that the internal audit function almost becomes redundant because everybody is doing what they are supposed to be doing at the appropriate time,” he added.

The economist also stressed that the Public Procurement Bill, which is currently before the House, is to be passed next year to ensure greater transparency of government’s procurement procedures.

“So all of that is part of the governance piece with respect to where we are working with ICAB to help,” said Straughn.
(marlonmadden@barbadostoday.bb)

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