Finance and Economic Development Minister, Hon. Christopher Saunders, MP, today (Friday, 21 May 2021) commended the entire public service for maintaining a steady improvement in financial management and reporting, following the latest report by the Office of the Auditor General (OAG).
In a series of three publications, OAG undertook to answer three audit questions:
• Does the Government have an effective and transparent budgeting process?
• How effective is the Government at financial management and reporting?
• How well does the Government monitor, measure and report on financial performance and long-term financial sustainability?
The OAG released the second of its three-part report yesterday titled Improving Financial Accountability and Transparency: Financial Management and Reporting. The report provides a high-level summary of financial performance, management and reporting at the entire public sector level.
The continuing theme of the OAG reports is that the Government and the wider public sector have significantly improved financial management and reporting. Of 18 recommendations the OAG made in its 2013 report, five have been fully implemented and six partly implemented.
Responding to the OAG report, Minister for Finance and Economic Development, Hon. Chris Saunders said: “Strong financial management and reporting are the established cornerstones of good governance, and the latest report from the OAG, rounds out the true picture behind the Government’s management and reporting efficacy.”
The OAG report states that over the last decade, the quality of financial reporting has markedly improved which has resulted in a reduction in the number of qualified audit opinions – from 16 in 2013/14 to none in 2019.
For the 2019 financial year, the majority – 38 of 41 – of public bodies submitted their 2019 financial statement for audit on time, which improved for the 2020 financial year, to all entities submitting their financial statements for audit by the statutory deadline.
Also, of the 37 audits of 2019 financial statements completed by the end of February 2021, all had received an unqualified audit opinion, which the OAG terms as a “significant improvement”. In contrast, in 2009-10, the majority of financial statements were either qualified or disclaimed.
“Yet, the OAG notes there is room for improvement, a situation we in the PACT Government take on board seriously,” Minister Saunders noted. This includes tabling all annual reports in Parliament. As at February 2021, only 118 of 160 sets or 74% of audited financial statements for 2015/16 to 2019 have been tabled, leaving 17 sets of audited financial statements for 2019 not yet tabled.
Additionally, during the 2015/16 to 2019 four years, the OAG lauds the Government’s actual financial performance against the six principles for responsible financial management outlined in the Public Finance and Management Act, which align with the Framework for Fiscal Responsibility (FFR) agreed between CIG and the UK Government.
“I am delighted to hear that the OAG has assessed that the Government has performed well against most of the principles”, Mr Saunders commented.
“Coming from a background of active involvement in the Public Accounts Committee scrutiny of the Government’s financial management and reporting throughout my career in Parliament, I am acutely aware of the need to consistently improve and ensure that the principles of responsible financial management are enshrined in the work of the current PACT Government”, Mr Saunders remarked.
“Audit oversight is an important tool in public finance management and the cornerstone of checks and balances in our democracy,” he added.
Deputy Governor and Head of the Civil Service, Hon. Franz Manderson noted: “I am heartened by the tenor of the OAG’s three reports. The feedback from the OAG helps to identify the opportunities that we have to continue to improve as we progress on our World Class Civil Service journey. I welcome the positive comments on the state of management and reporting within core civil service, which are reflective of the success of our efforts to continually improve our processes in this area.”