The General Audit Chamber issued their report to Parliament on the 2013 Financial Statements of Sint Maarten today, Wednesday, December 3rd, 2014. The National Financial Accounting Ordinance (NGAO) requires that we publish a report on our findings within a period of one and a half months after receipt of the copy of the report from the auditor (SOAB). SOAB has one and a half months to complete their audit. The Financial Statements were presented to us on September 3rd, 2014, in a letter from the Minister of Finance dated August 27th, 2014. We have complied with the legally stipulated period for submission.
Our report represents the financial compliance audit of the financial statements and the operations of the ministries of government of Sint Maarten of fiscal year 2013. As part of this audit, we evaluated whether the information contained in the financial statements about the finances and policy at the ministries was conducted in compliance with regulations and whether the financial statements are a fair and accurate reflection of such.
In our report on the 2011 and 2012 Financial Statements, we pointed out that government needed to comply with the legally stipulated time frames for submission. In the case of the financial statements, these should be drafted no later than September 1st following the year to which they relate. For the 2013 Financial Statements, government has complied.
Moreover, in our reporting on the 2012 Financial Statements, we indicated that there were a number of items in the financial statements that we found objectionable. We further stated that if improvement was not noted, we would consider issuing a formal objection in accordance with our legal authority. Based on our audit of the 2013 Financial Statements, we conclude that six (6) of the ten (10) items we listed as objectionable were (partially) solved. As such, a slight improvement is evident over the previous year.
Most errors and uncertainties - in our opinion - are easy to correct. As such, it is reasonable to expect the financial statements to be drafted free of errors and uncertainties within a reasonable period of time. We have made recommendations to the Minister of Finance in this regard.
As part of our audit of the 2013 Financial Statements, we reviewed the issuance of subsidies in terms of compliance with legal requirements. We found that minsters hardly, if ever, check, whether the granting of subsidies occurs in accordance with the General Subsidy regulation. It is our opinion, that ministers should adequately inform Parliament about the effective use of subsidies to recipients by requiring the institutions to periodically provide reports on their respective activities, costs, achievements and results.
As in previous reports on the financial statements of government, we find that the annual report of the Minister of Finance, provides insufficient information to Parliament regarding the effectiveness of public expenditures. Based on our overall findings, we are of the opinion that the 2013 Financial Statements of Sint Maarten do not meet the requirements and standards as required by the NGAO. Hence, we are of the opinion that the SOAB is justified in issuing a negative opinion of the 2013 Financial Statements of Sint Maarten.
We have requested the Minister to provide within six months, a realistic plan with which to ensure that the deficiencies we have identified in terms of the financial management, are resolved within a few years. The minister in his formal response has agreed, albeit with three considerations, to produce such a report. Details regarding the minister’s response is included in its entirety in our report.
In the coming year, we will continue to monitor progress on the improvements to the financial management of government.
The report on the 2013 Financial Statements of Sint Maarten is available in both English and Dutch on the website of the General Audit Chamber (www.arsxm.org).