The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Central and local government agencies on Grand Bahama have been given until August 7 to explain how they will address weaknesses that, in one case, led to public monies being "grossly manipulated".

Reports by Terrance Bastian, the Auditor-General, into the Port Department and West Grand Bahama central and local government accounts for 2016 branded the results of all three audits as "unsatisfactory".

The reports, tabled in the House of Assembly by speaker Halson Moultrie, in particular found that revenues collected by the Port Department and central government in west Grand Bahama were not being deposited "in a timely manner".

The Auditor-General's office, in its examination of the Port Department's finances, found that boat registration fees for 2016 had increased by 82 percent or $65,063 year-over-year, jumping from $79,039 to $144,102.

Yet jet ski registration revenues had fallen by $2,970, or 11 percent, over the same period to $24,070, leaving the Port Department with a cumulative revenue increase year-over-year of 59 percent or $62,093.

Turning to the weaknesses identified, the Auditor-General's report said: "Twelve deposit slips totalling $13,650 were not verified by a second person. We recommend that all bank deposits are verified by a second person, and the deposit slips signed by the preparer and the verifier prior to bank depositing.

"Our audit examination to ensure that funds collected were deposited within 24 hours of receipt revealed that funds collected on a daily basis were sometimes deposited as late as 10 business days after funds were collected."

Concerns were also raised over the revenue deposits and reports to the Public Treasury, with the latter's staff producing documents to show monies were received from the Port Department even though "the deposit was not found in the actual revenue detail".

The Auditor-General's office concluded: "It is evident, from the results of this examination, that the Port Department - in the administration of public funds - has not employed all reasonable care in adherence to good and sound internal controls.

"Lack of adherence to established controls weakens the reliability of the information produced by the system.... It is our opinion that this department must exercise due diligence in the performance of their duties to ensure that revenue is accurately assessed, collected, recorded and deposited intact and in a timely manner."

As for central government's revenue accounts in west Grand Bahama, the Auditor-General's Office found examples of where revenue from building permit fees and the like was "not brought to account", and receipts that did not match deposit slips.

"It is evident from the observations above that public funds/revenue is being grossly manipulated," its report said. "Custodian of the accounts in the district must be held accountable for this practice of manipulation of public funds. We continue to emphasise that this delay in reporting of revenue collected constitutes misuse or abuse of public funds."

Revenue sometimes took up to 29 business days to be deposited, the Auditor-General's Office discovered, rather than the 24-hour timeframe required by the Government's internal control guidelines.

"Funds collected were not brought to account within a timely manner (within 24 hours of receipt) in an effort to mitigate the risk of theft or misuse/abuse of public funds," the report said, noting that three months of missing bank statements were not available for audit inspection.

When it came to local government's expenditure accounts in West End, the Auditor-General's Office found $38,459 in outstanding cheques dating as far back as June 20, 2007 - more than a decade.

"There were 45 stale-dated cheques totalling $11,582, which have been on the outstanding cheque list from June 20, 2007," its report said. "It is our recommendation that stale-dated cheques totalling $11,582 are transferred to the reserve account.

"There were no monthly bank statements or bank reconciliations produced for audit inspection. We hereby note that the bank statement balance at June 30, 2014, was $19,011."