The story in your edition yesterday captioned ‘I broke no laws’ on Mr Winston Brassington’s defence of his NICIL tenure refers.
The report to which Mr Brassington referred is my final report, not a draft report. A preliminary draft report was issued on September 30, 2015, and a response was received on October 19, 2015. Although I was taken aback by the tone and language of the response, I nevertheless remained calm; studied the response carefully vis-à-vis my findings, conclusions and recommendations; and made appropriate amendments to the report. On the basis of this, I prepared my final report and issued it to the Minister of Finance. The report was copied to the Minister within the Ministry of Finance, the Chairman of NICIL’s board and the Finance Secretary. It is therefore not true that NICIL did not receive a copy of the report.
In my transmittal letter to the Minister, I stated that a formal response to the report was expected with 14 days, and when received, it would be appended to my report and resubmitted to the Minister. Regrettably, as of today’s date, I am yet to receive the formal response. This approach was discussed and agreed upon with Minister Sharma, considering the hostile reactions of NICIL in relation to my findings, conclusions and recommendations. I have had several rounds of discussions with him in relation to the contents of the report.
I have tried my best to incorporate as many explanations as possible provided by NICIL where, in my professional judgment, such explanations are considered necessary for a better understanding of the report and to ensure as far as possible that the report gives a balanced view. Instead of focusing on the findings and recommendations, Mr Brassington, however, chose to make elaborate and demeaning comments in relation to my selection to undertake the assignment, the methodology I used, the structure of my report, and my findings, conclusions and recommendations. He then chose to attack me (the messenger) rather than dealing with the message, in the hope of destroying the credibility of my report. I am prepared to make available a copy of Mr Brassington’s response to any interested person/entity to attest to his attitude towards the draft report.
Almost every finding was vigorously and arrogantly disputed, with comments such as “this is opinion and should be struck out from the final report” or “the forensic auditor is not qualified to pronounce on these matters.” In all my career in auditing, I have never received such hostile reactions from any client, as in the case of NICIL, despite the fact that I had extended all due courtesies in the conduct of the audit. Suffice it to state, there is always going to be some degree of disagreement between the auditor and the client, and it is incumbent on the latter to explain his/her position in the most courteous and professional way. Hostility and arrogance have no place in any relationship between the auditor and the client. In the final analysis, it is the auditor’s views that will prevail because he/she is external to the organization and because of the degree of independence, objectivity and professionalism that are brought to bear on the audit.
I have had a number of meetings with Mr Brassington, and on each occasion he would have his senior management team present with their computers working away, as well as persons who appeared to be note-takers. Apart from the occasional comment from his deputy, no one spoke at the meetings, except him. The atmosphere appeared to me very intimidating and was indeed not welcoming. No one was also allowed to provide any information to me without the approval of Mr Brassington. Once I had requested to see the organization chart of NICIL, and was told that the information could not be provided without such approval. Mr Brassington was overseas at the time. As a result of this state of affairs, a severe restriction was placed on the audit, and I had no alternative than to rely almost exclusively on the use of questionnaires to solicit information and to request documents. Even this approach presented some difficulty.
As regards the contention that the report contains opinions that are not backed by legal support, especially as regards Articles 216 and 217 of the Constitution, the report is there for the public to draw their own conclusions. Mr Brassington indicated that NICIL had over the years the benefit of legal advice from five law firms but he did not mention the names of the firms in question. On the other hand, paragraph 4.2.18 of my report dealing with Article 216 referred to the fact that my conclusion was based on legal advice that I had received. In relation to Company Law requirements, Mr Brassington referred to the opinion of a Chartered Accounting Firm in support of consolidation. I have, however, identified the relevant section of the law where consolidation is not required. I also referred to the “matching principle” and “substance over form” in support of my arguments. The issue is more of an accounting one rather than a legal one.
Despite all the financial management issues raised in my report, Mr Brassington contended that NICIL has been receiving clean audit reports over the years which he felt was conclusive evidence that finances of NICIL are in order. In this regard, it is instructive to note the comments of the Transparency Institute Guyana Inc in its column in yesterday’s Stabroek News:
“Both the former president Bharrat Jagdeo and the Executive Director of NICIL have boasted that NICIL has been receiving unqualified (“clean”) audit reports and therefore nothing is wrong as regards the financial management of the entity and its financial reports. However, this assertion is at complete variance with the results of the recently concluded forensic audit of the entity. That apart, how does one explain the following?
“• The spouse of the Chairman of NICIL had overall responsibility for the audit of NICIL;
- the Chairman instructed that the audits of all public corporations vested in NICIL be contracted out to Chartered Accountants in public practice but the audit of NICIL must remain with the Audit Office where his spouse holds the number two position;
- as at September 2012, NICIL was ten years in arrears in terms of financial reporting and audit; and
- following a National Assembly resolution of June 2012 calling on the Minister of Finance to take steps to bring all outstanding accounts of NICIL brought up-to-date and the related reports presented to the National Assembly, on 27 September 2012, the Auditor General issued ‘clean’ audit reports on NICIL’s accounts for four consecutive years, i.e. 2002 to 2005.”
Contrary to the assertions made by Mr Brassington, it is not the practice for audit reports to carry footnotes. As auditors, we try to incorporate all references in the body of the report. As regards the structure of the report, readers will notice that there is an executive summary, introduction, terms of reference, scope and methodology, and findings and recommendations sectionised in the sequence of the items in the terms of reference. Mr Brassington is out of order to seek to determine the structure of the report or to comment on it. He should instead focus on the message. The report was written using an analysis framework involving criteria (who should be), condition (what has happened), cause (analysis of the mismatch between criteria and condition), effect, conclusion and recommendation. It is therefore not true to state that the report is based on opinions.
Finally, no effort to create diversion or seek to destroy the credibility of my report as a defence mechanism will succeed.