Part II
Last week, we examined the accountability arrangements of all statutory bodies, especially as regards compliance with the Fiscal Management and Accounta-bility (FMA) Act. The Act defines a statutory body as a public entity that has been established by law. However, Section 82 provides for the classification of such bodies as: public enterprises; departmental enterprises; and other bodies. It is not clear whether this was done since the Audit Office considers public enterprises separate as distinct from statutory bodies, and there is no separate categorisation of departmental enterprises.
That apart, we noted that the Act requires all statutory bodies to have their accounts audited and presented to the concerned Ministers not later than four months after the close of the financial year. As at 31 August 2013, however, only four out of 40 such bodies listed 
in the Estimates of Expenditure have audited accounts for 2012. In addition, most of these entities are significantly in arrears in terms of financial reporting and audit. According to the Audit Office’s records, 14 entities did not have their accounts audited for more than five years, including the expenditure on the World Cup Cricket, Guyana Information Agency (GINA), National Parks Commission, and Transport and Harbours Department.
Today, we examine the requirements of the FMA relating to the laying in the National Assembly of the annual reports of statutory bodies and assess the extent to which there is compliance with the Act. Most of the statutory bodies are in receipt of government subsidies and therefore there is a greater need for the legislature to be apprised in a timely manner of the state of affairs and performance of these entities.
Laying of annual reports in the National Assembly
Section 80 of the Act requires the concerned Ministers to submit the annual reports (including audited financial statements) of statutory bodies to the National Assembly within two months of the receipt of such reports. In other words, within six months of the close of the financial year, all statutory bodies are to have their annual reports tabled in the National Assembly.
An examination of the records of Parliament Office revealed that no annual reports for 2012 in respect of statutory bodies were laid in the National Assembly. Where annual reports were presented in the National Assembly, in many cases several years were submitted together. The following table shows the pattern of submission from 2006 to date. For these 21 entities, the average number of years submitted at the same time is 8:
Name of entity Years No. of years Date laid
National Parks Commission 1989-2007 19 27 June 2013
IAST 1994-2003 10 -do-
Lands & Surveys Commission 2001-2009 9 -do-
Guyana Office for Investment 1994-2011 18 -do-
Guyana Energy Agency 1998-2009 12 -do-
EPA/Wildlife Division 2009-2011 3 -do-
Wildlife Management Authority 1998-2008 11 -do-
Environmental Protection Agency 1999-2008 10 -do-
Geology & Mines Commission 2001-2003, 5 25 March 2013
2005, 2007
Cheddi Jagan Int’l Airport 2002-2010 9 25 January 2013
Demerara Harbour Bridge 2003-2009 7 -do-
National Sports Commission 2005-2010 6 17 December 2012
Public Utilities Commission 2000-2010 11 22 August 2012
National Communications Network 2007-2008 2 8 June 2012
Central Housing & Planning Authority 2006-2009 4 19 May 2011
National Communications Network 2004-2005 2 28 April 2011
Sugar Industry Labour
Welfare Committee 2007-2009 3 5 August 2010
Dependants’ Pension Fund 1996-2003 8 12 November 2009
Guyana Gold Board 2002-2008 7 25 June 2009
Central Housing & planning Authority 1997-2005 9 29 November 2007
A similar distressing pattern is replicated in respect of other state-owned/controlled entities, though to a lesser extent, as shown below:
Name of Entity Years No. of years Date laid
Kwakwani Utilities Inc. 2010-2011 2 27 June 2013
Guyana national Co-operative Bank 2009-2010 2 7 May 2013
Lethem Power & Light Inc. 2009-2011 3 -do-
Port Kaituma Power and Light Inc. 2010-2011 2 -do-
Guyana National Newspapers Ltd 2009-2011 3 -do-
Guyana Electricity Corporation Inc. 2009-2011 3 7 February 2013
NICIL 2006-2008 3 17 December 2012
NICIL 2002-2005 4 8 November 2012
Aroaima Mining Company Inc. 2006-2010 5 22 October 2012
Linden Mining Enterprise 2004-2011 8 -do-
Atlantic Hotel Inc. 2009-2010 2 -do-
Linden Electricity Company Inc. 2005-2006 2 15 March 2012
National Insurance Scheme 2008-2009 2 28 April 2011
Guyana Oil Company Ltd 2002-2009 8 14 October 2010
Guyana Television Broadcasting Co. 2002-2004 3 -do-
National Edible Oil Co. 2002-2007 6 -do-
Guyana National Newspapers Ltd 2002-2006 5 -do-
Guyana Pharmaceutical Corporation 2002-2003 2 -do-
Linden Mining Enterprise 2002-2004 3 -do-
Aroaima Mining Co. Ltd 2002-2006 5 -do-
BIDCO 2002-2003 2 -do-
Kwakwani Utilities Inc. 2005-2008 4 5 August 2010
Linmine Electricity Inc. 2003-2004 2 -do-
Guyana National Co-operative Bank 2002-2005 4 -do-
Guyana Electricity Corporation Inc. 2002-2007 6 -do-
Lethem Power Company Inc. 2003-2004 2 -do-
Berbice Mining Enterprise Ltd 2002-2003 2 -do-
Guyana National Printers Ltd 2002-2008 7 -do-
Guyana National Shipping Corp. Ltd 2002-2008 7 -do-
Property Holdings Inc. 2000-2008 9 12 November 2009
Guyana Power and Light 2007-2008 2 -do-
Guyana Sugar Corporation 2007-2008 2 -do-
Guyana Water Inc. 2005-2007 3 21 May 2009
National Insurance Scheme 2005-2007 3 26 February 2009
Guyana Sugar Corporation 2004-2006 3 7 August 2008
Guyana Securities Council 2005-2006 2 10 May 2007
Commissioner of Insurance 2003-2005 3 7 December 2006
This trend clearly indicates the level of tardiness involved in adhering to the requirements of the law and in fulfilling a fundamental requirement of any democratic system ‒ providing timely feedback to the legislature on how public entities have expended funds allocated to them and whether good value was achieved for expenditure incurred by them. What is even more alarming is that legislators seem comfortable with, indeed are complacent about, this practice since there is no evidence that concerns were raised in relation to the lack of timeliness in having annual reports and audited financial statements laid in the National Assembly. In addition, there is no discussion of the contents of these reports and for all purposes the laying of the accounts is seen as merely an academic exercise. Indeed, none of the annual reports of statutory bodies and public enterprises were referred to the Public Accounts Committee (PAC) for detailed scrutiny.
Work of the PAC
As regards the work of the PAC, it should be noted that the last report to be tabled in the National Assembly relates to the 2009 Public Accounts. This was laid on 17 December 2012. The following table shows the trend in the finalization of the PAC reports and laying them in the National Assembly. Included in the table also are the dates when the government’s responses in the form of Treasury memoranda were laid in the National Assembly:
Year Date PAC report laid Date Treasury Memorandum laid
2000 & 2001 2 March 2006 30 October 2006
2002 & 2003 14 February 2008 3 December 2008
2004 & 2005 15 February 2010 15 July 2010
2006 4 November 2010 3 March 2011
2007 & 2008 2 June 2011 1 September 2011
2009 17 December 2012 27 June 2013
2010 Not yet finalised Awaiting PAC report
2011 Not yet finalized Awaiting PAC report
Quality of accounting and financial reporting
Given the above state of affairs as it relates to the accountability arrangements for statutory bodies, including public enterprises, as well as the work of the PAC, one can legitimately ask the question ‒ is this the way the concerned ministers and legislators are serving the public interest?
Last week, we mentioned that we seem contented that we have audited accounts of the country in a timely manner. What we fail to mention is the quality of the accounts. In the case of the 2011 public accounts, of 13 sets of financial statements submitted for audit, the Auditor General did not give any an unqualified opinion, ie a ‘clean’ bill of health. In fact, he disclaimed his opinion on five of these accounts because of uncertainties of a fundamental nature. The remaining eight sets of statements were given qualified opinions because of uncertainties of a material nature.
Let us rewind to 1992, the year when public accountability was restored due to the almost single-handed efforts of the Audit Office. The restart was not a perfect one with an estimated level of completeness and accuracy of around 60 per cent. Of the ten sets of financial statements submitted for audit, disclaimers of opinion were issued for three sets of statements while the remaining seven were given qualified opinions. Two sets of statements were not presented for audit because the government was unable to put them together. This was understandable, given the ten-year gap in financial reporting. However, one would have expected that as each year elapsed, there would have been progressive improvements in the quality of financial reporting. It is indeed regrettable that this has not happened since the Auditor General’s assessment over the years culminating in 2011 reflects a situation almost identical to that of 1992.
Yet, no one seems to care about the quality and timeliness of our accountability arrangements. A disclaimed set of accounts is not worth the paper it is written on, yet we seem excited to go through the annual ritual of presenting the audited public accounts to the Speaker of the National Assembly in the presence of members of the PAC and the media. Another round of the ritual will take place today, with television broadcasts later in the evening and headlines in tomorrow’s newspapers.
It boggles the mind that our Minister of Finance, who has a PhD in Accounting and Finance and who certifies the public accounts, has not seen the urgent need to overhaul our accounting and financial reporting system to bring it in line with international best practices and to ensure quality accounts are produced. It is noteworthy to mention that under Section 58 (1) of the FMA Act, the Minister is required to promulgate appropriate accounting standards to be employed by officials responsible for the maintenance of the accounts and records.
