BELIZE GOVERNMENT AUDIT REVEALS CRIMINALITY?

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Silence surrounds 08-09 Audit � what does it say?
( taken from public Belize Culture listserve )

GOVERNMENT AUDIT REVEALS CRIMINALITY AND CORRUPTION, PLUS LACK OF BACK OFFICE CONTROLS IN BELIZE GOVERNMENT.

HONOURABLE ELECTED REPRESENTATIVE, ONE TIME ALLEGEDLY ACCUSED IN THE MEDIA OF EMBEZZLING FUNDS FOR HIS CONSTITUENT VOTERS XMAS HAM GIVE-A-WAY, - HEADS ACCOUNTABILITY GOVERNMENT DEPARTMENT, WHICH DOES NOTHING TO FIGHT CORRUPTION IN GOVERNMENT! Reputedly they do not even work?" - near end of this audit report copy - ( no surprise there? )

"Albert area representative for the Opposition People’s United Party, Hon. Mark Espat, chairs the INFAMOUS Public Accounts Committee.


BELIZE ONLY HAS ONE POLITICAL CONTROLLED POLICE SYSTEM FOR THE WHOLE COUNTRY. NO SURPRISE THAT 171 POLICE VEHICLES WERE "DISAPPEARED" FROM OUR ONLY SECURITY SERVICE!

BELIZE GOVERNMENT MINISTRIES HAVE ALL KINDS OF SECRET BANK SLUSH FUNDS!

BELIZE GOVERNMENT SUPPLIED VEHICLES WIDELY USED AS PERSONAL TOYS!

LARGEST OF THE TELECOMMUNICATION PROVIDERS IN THE COUNTRY OWES $18 MILLION IN BACK TAXES.

(Posted: 17/08/10) There has been silence over the last Audit Report of the Government of Belize, tabled in the House of Representatives on Friday, August 6, 2010. While there has been a lot of focus on the Special Lands Audit for the six months leading up to the 2008 General Elections, which outlined a number of irregularities, the picture painted by the 2008-2009 Audit report is far more startling.

- 165 missing police vehicles; un-reconciled bank accounts

- Questionable transactions have ballooned from $142 million in 2005 to $280 million last March

- “...the recurring theme in our audits is now that ‘records cannot be located’”

- Sawmill purchased for $66,000 for the Kolbe Foundation not accounted for

There has been silence over the last Audit Report of the Government of Belize, tabled in the House of Representatives on Friday, August 6, 2010. While there has been a lot of focus on the Special Lands Audit for the six months leading up to the 2008 General Elections, which outlined a number of irregularities, the picture painted by the 2008-2009 Audit report is far more startling.

Edmund A. Zuniga, Auditor General, compiled the report in November 2009, which includes transactions under both administrations of the ruling United Democratic Party (UDP) and the Opposition People’s United Party (PUP). His report points to growing frustration with the Government, which has essentially turned a deaf ear to the concerns laid out in previous audit reports.

The report said, “...the recurring theme in our audits is now that ‘records cannot be located’.”

The report indicates that the purpose of the audit was to find out whether Government accounts were kept using acceptable systems and were punctually and properly posted. They are also done to see whether checks against irregularities and fraud were adequate and effective to give reasonable assurance that the financial statements are free from material misstatements. To accomplish this task, the Audit Department is staffed with 40 people and given a budget of $1,728,090 for 2010/2011 (or 0.2% of the national budget).

The Audit report identified several other concerns, and noted that the same problems discussed in previous audits have clearly not been addressed: “As a result, it behooves this office to raise them again in this report in the hope that they will be addressed by the time our next report is due,” said Zuniga’s report.

The financial statements of the Accountant General, for the year ended 31st March 2009, were received on September 23, 2009; they were due three months after the close of the financial year, it said.

One major problem highlighted is that for a long period of time, bank accounts across several government ministries and departments have not been reconciled. “As a matter of fact, it appears that there is no inventory of all the government-related bank accounts held by various ministries and departments.”

Likewise, inventory management continues to be deficient, said the report: “The lack of adequate inventory records is widespread throughout Government. This is in spite of the large sums spent, on an annual basis, on equipment, furniture and fittings. Adequate inventory management is important to ensuring that Government assets are properly accounted for and safeguarded.”

The way in which government vehicles are used is also a concern: “Audit inspections once more revealed the continued poor control over the use of government vehicles,” the report detailed. “Logbooks were not properly maintained... Consequently private runs and misuse were undetected.”

Getting into the dollars and cents of public accounts, the Audit detailed other areas of concern: “Cash held at sub treasuries of $517,439.44 differed from the balance of $270,970.16 reported on SMARTSTREAM. This is a difference of $246,469.28...” the audit detailed. “Bank reconciliations and confirmations in respect of 16 bank accounts totaling $72,167,204.00 were not presented,” said the Audit.

The dollar figure of questionable transactions has ballooned from $142 million in 2005 to $280 million last March: “According to the SMARTSTREAM Accounting System the suspense account [an account used temporarily to carry doubtful receipts and disbursements or discrepancies pending their analysis and permanent classification] stood at $280,868,894.30 at the end of March 2009, while the statement recorded the balance at $262,543,943.00, a difference of $18,324,951.30. Additionally, it was noted that the account has almost doubled, as at the end of 2005 the suspense account stood at $142,351,656.73,” the Audit said.

There are also questions in the audit regarding the public debt of $2,028,575,248, comprising external debt of $1,856,249,151 and domestic debt of $ 172,326,097. “No information has been provided in respect of loans guaranteed by the government,” the report said.

Pension Scheme overpayments to 27 pensioners who had already died totaled $266,573.52 for 2000 to 2007, whereas the Income Tax Department overpaid $291,653.58 in refunds (2000-2008).

There was substantial non-payment of taxes, running in the tens of millions. Personal income tax arrears for 2001 to 2008, which employers deducted from workers but did not pay in to Income Tax, exceeded $1.5 million.

Banking sector arrears in business tax totaled $31,873,862.11, with $31,803,492.60 being for the Belize Bank, said the Audit.

There was also $51,745,229.76 in arrears of business tax for companies—$11 million for Belize Telemedia Limited (BTL), and roughly $8 million for BTL subsidiaries. NEWCO Limited, which had been contracted for the privatization of the Philip Goldson International Airport, is listed for $5,477,805 in the report.

There was $113,644.30 in wasteful expenditure for the Ladyville Forensic Laboratory Project, according to the report. After the million-dollar project was completed, the report notes, three other sets of works had to be done, costing the government a further $113,644.30 for “the relocation and reconditioning of walls, sealing of some external windows and the construction of new cabinets,” “resealing the roof,” and “electrical connection from transformer to the building, re-installation of Air-Conditioning Units, and installation of UPS System.”

Almost $40,000 worth of the work had already been paid for in the original contract. Additionally, there was no evidence that the tender procedure had been carried out in awarding the contract, said the Audit report.

Missing police vehicles were also detailed in the report: “On comparing the vehicles on the vehicle list from the Vehicle Care Unit with the 212 vehicles on the list prepared by the Police Department audit found that (171) vehicles were not accounted for on the Police Vehicle List. This, therefore, meant that the Police Department should have had 383 vehicles (i.e. 212 plus 171).

“Of the 171 vehicles mentioned above the Ministry of Finance confirmed that 18 vehicles were actually issued to other ministries and departments and therefore the department should have had an additional 153 vehicles. In addition to the (153) vehicles unaccounted for... (12) vehicles were on the police list but the police department was unable to provide information on their location. [This makes a total of 165.]”

The Audit report also had a notation on the street security cameras. Back in 2007, the Government had contracted the Panamanian firm, Estephan Enterprises, to supply and install a camera security system at 6 Belize City locations for $750,381.

“On the 24.09.08, about 9 months after the contract was signed, Audit conducted a physical inspection, which revealed that three (3) cameras at Belchina Bridge, Pound Yard Bridge and Kraal Road were not operational.”

Audit takes the view that Estephan Enterprises was in breach of Clause #4 of the contract for not having rectified defects within the 1-year warranty period.

“It was also disturbing to note that the contract did not contain any provision for training of personnel within the Police Department, or otherwise, in the maintenance of the systems,” the report added.

The Audit report also said that a sawmill purchased for $66,000 for the Kolbe Foundation was not accounted for: “Audit requested a physical inspection of the sawmill. Up to date [of the report] the management of Kolbe has not complied with this request.”

Zuniga told Amandala that while the law requires staff to respond to the questions and requests of the Audit team, Audit has no power to enforce compliance. “Persons should be taken before the Public Accounts Committee, but that’s a committee of the House that doesn’t work,” he said.

The audit includes the first ever audit by The Office of the Auditor General of the Public Utilities Commission (PUC), spanning 2000 to 2008.

The PUC collected $16.2 million in revenue from 2001 to 2007. The funds were deposited into four bank accounts that the Ministry of Finance did not approve, contrary to provisions in the PUC Act, the audit noted.

“It was observed that $4,652.78 in personal advances approved to 3 persons who were no longer in the employ of the Commission remained outstanding since November 2007,” the Audit report said.

The ball, again, appears to now be in the court of the Public Accounts Committee: “A review of the Annual Report for 2006/2007 shows that several such issues were brought to the fore; however these have remained unanswered. It is, therefore, safe to say that the report has had no effect on the improvement of accountability in the public service. In my view, this will only be remedied when the Public Accounts Committee takes accounting officers to task in addressing the issues raised by the Auditor General in his report,” the Audit report stressed.

Albert area representative for the Opposition People’s United Party, Hon. Mark Espat, chairs the Public Accounts Committee. We know that he has been trying to have a meeting convened. Amandala was unsuccessful in our attempt to reach Espat Monday evening for an update.