Auditor General’s report tabled in Parliament highlighting several key matters of concern

The Auditor General’s report to the Assembly has been tabled at the meeting of the Fono Ekepule last week. 

The update report contains the findings of the Auditor for the period ended 30 June 2015. Auditor General John Ryan started by saying that he is satisfied that the Government of Niue financial statements for this period were all fairly represented. 

However, the report dated 19th December 2019 contained several issues of grave concerns raised by the Auditor General. 

Ryan firstly acknowledged that the Government of Niue has recently engaged the services of chartered accountancy firm Deloitte NZ to provide assistance in the preparation of the financial statements for the Government of Niue and its subsidiaries that are currently in arrears. 

In the report the Auditor identified several key matters of concern; 

1. Financial sustainability – with the government’s 2014/2015 reporting a deficit of over $2.5 million 
2. Niue Numismatic and Philatelic Corporation (NPNC) – which has failed to file any PAYE income tax for its employees since 2012 and is not complying with the NCT laws by not registering for NCT. Additionally, NPNC has not made regular distributions to the Government of Niue and for the donations it makes to public entities lack sufficient supporting documentation and have not gone through the Assembly’s budget approval process. The report notes that the NPNC no longer reports its financials to the Assembly. 
3. Capability and Capacity – the report states that the delays in the preparation of financial statements needs improvements. There is also continuous issues with tax collection as a result of ongoing capacity and capability issues 
4. Unauthorized expenditure – for the financial year 2014/2015 the appropriation act was exceeded by more than $1.4 million dollars. Cabinet approved $224,000 of this but more than $1.2 million was not approved by Cabinet or through a supplementary budget. The Audit report highlighted the breach of article 53(3) of the Niue constitution. 
5. Insufficient records and lack of supporting information – The Auditor highlighted this as a key issue for the Government of Niue group and also highlighted this is in relation to the NPNC which included missing or damaged invoices, key decisions not being documented and revenue not recorded. 
6. Donor funds and aid money management – the Auditor states that he has concerns around project management, including key projects being behind schedule and over budget, unfavorable donor initiated audits, poor record keeping, instances of incorrect coding and costs which have incorrectly been capitalized. For the FY ended 30 June 2015 the total trust fund balance for projects that were a work in progress was just over $4.7 million however there was only $3.2 million cash held in donor and trust funds deposits. This indicates that donor ash has been used for expenditure other than the respective donor projects. 
7. Previous audit findings and recommendations – the report found that there continues to be a significant number of previous audit findings and recommendations that have not been addressed by the Government or relevant subsidiary and he encouraged the Government to treat these with the importance and urgency to address and action accordingly. 

The Fono Ekepule voted to send the Report to the Public Accounts Committee to present a report to the House at their next meeting expected to take place in two weeks time. 

At the same meeting of the Fono Ekepule last week, the government through the Office of the Premier tabled a report in response to the Auditor’s report.  

The Fono Ekepule is expected to dissolve at its last meeting on the 29th of April and the government will go into caretaker mode until after the General elections on May 30th.