An audit report of the Ministry of Economic Development for 2010 released this week found large discrepancies between the ministry’s internal records and the general ledger kept by the Ministry of Finance and Treasury.
The report noted that the Economic Development Ministry did not “identify and reconcile” discrepancies of over Rf6 million (US$389,105) in income and Rf8 million (US$518,806) in expenditure between its accounts and the finance ministry ledger.
In a recurring finding of audits of state institutions for 2010 recently completed by the Auditor General’s Office, the report noted that the ministry did not compile its financial statement in accordance with ‘International Public Sector Accounting Standards’ (IPSAS) as stipulated by regulations under the Public Finance Act, and as a result lacked important information such as detailed “disclosure notes”.
The annual financial statement did not specify how Rf1 million (US$63,850) allocated for the trade representative in Geneva was spent, the report stated.
With the exception of five main issues identified for reform, the audit report found that the ministry’s expenditures were “for the most part in accordance with state financial regulations and for projects specified in the budget.”
Among the recommendations were: comply with IPSAS for future financial statements; issue receipts for all cash collections; obtain quotations from at least three parties for procurement ranging between Rf1000 and Rf25,000, invite bids for purchases above the limit and ensure that an employee signs for goods and services; improve inventory and stock maintenance and account for a lost laptop; ensure expenditures are made under the appropriate budget code.
In other findings, the report noted that renovation work on the ministry’s new offices went over budget by Rf179,629 as a result of poor planning and insufficient instruction to the carpenter chosen for the work. Moreover, the same carpenter was employed for the additional work without a public announcement to seek quotations from other parties.
The report also recommended depositing fees and other income collected by the ministry to the state’s consolidated revenue fund in lieu of sending the cash to the Maldives Inland Revenue Authority (MIRA), which incurs a high cost, takes up employees’ time and risks loss of the money during transfer, the report stated.
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