The Auditor General's report for 2002 says that the Ministry of Foreign Affairs' monthly releases to overseas missions for the purpose of meeting current expenditure were often received close to the end of the month while funds to meet capital expenditure in most cases were also not remitted until January 2003.
These are among the numerous findings of the report of the Auditor General laid in the National Assembly late last year.
The ministry is making efforts to correct the situation, said Foreign Affairs Minister Rudy Insanally in a comment to Stabroek News on Monday, adding he has been assured that the remittances were sent off to various missions. He attributed the delays to an end-of-year snafu.
Some of the missions were forced to use revenue generated from passport applications to meet their operating expenses such as accommodation, telephone bills and wages.
The report says that during the period under review, amounts totalling $186.8M were remitted to the ministry by Guyana's overseas missions for onward transmission to the Accountant General's department. This department is required to examine the revenues remitted with the supporting documents and deposit the revenue into the Consolidated Fund. However, at the time of reporting, only $102.3M was deposited into the Consolidated Fund bank account.
As a result of this, the revenue has been understated by $84.4M. The report states that although the Accountant General's department issued acknowledgement receipts, these were not forwarded to the relevant missions. The Accounting Officer explained that a system was being put in place to ensure that receipts are picked up and dispatched to missions.
At the time of reporting in July of 2003, the actual staffing at the Guyana Consulate in Toronto, Canada, stood at eight: three being home-based and the rest locally recruited. Because the Auditor General did not receive information on authorised staffing, it could not be determined if the mission was operating with its full complement of staff. But the Accounting Officer explained that the ministry was in the process of reviewing the staffing structure of the missions at the end of which the staffing strength would be determined.
The Toronto mission has been in receipt of its monthly remittances close to the end of each month. The Auditor General said that based on discussions that he had with the Consul General and the Finance Officer, this practice was adversely affecting the operations of the mission since the payments of goods and services were normally delayed to avoid bank accounts being overdrawn. The Auditor General recommended that the ministry's head office institute measures aimed at ensuring that remittances are sent to the missions in a timely manner.
An examination of the statements of expenditure for the year 2002 revealed an actual expenditure of $37.3M compared with the budgetary allocation of $49.5M, a net saving of $12.2M. The report states that employment costs accounted for $14.6M and do not include the emoluments for home-based staffers who were paid directly by the head office.
"According to the correspondence seen, although amounts were included in the mission's allocation for emoluments of home-based staff, the mission was instructed not to include the associated costs in its expenditure statement. This practice appears inconsistent and gives a distorted view when comparing budgetary allocations with actual expenditure. It is therefore recommended that the emoluments of home-based staff be included in the mission's expenditure statement," the report states.
The report says also that there were instances where the revenue was remitted six months after the month of collection and to this the Finance Officer said that the money was deposited in the main account promptly. But because of late and insufficient remittances the revenues were not remitted as expected.
At the time of audit in June 2003, revenues totalling CDN $76,345 in respect of the period September 2002 to March 2003 were not remitted to the Consolidated Fund.
For the Guyana High Commission in Ottawa, the Auditor General found that the Remittances Register was not properly written up for the period under review. Pertinent information such as date received, period of remittance and receipt numbers was left out. The report states that as a result, alternative audit checks had to be carried out.
An examination of the statement of expenditure for 2002 revealed an actual expenditure of $34.5M compared with a budgetary allocation of $52.8M giving a net saving of $18.4M.
Three payment vouchers totalling $216,946 were recorded in the votes ledger as $311,702 resulting in the overstating of the ledger by $94,756. In addition, four payment vouchers totalling $145,994 could not be traced to the votes ledger.
The report points out that in January 2001, the Ambassador for the Guyana Embassy in Washington wrote the ministry's head office stating that his indebtedness to the mission had increased to US$57,161, equivalent to $9M. He wrote the ministry again on April 29, 2003. On that occasion he indicated that the advances were US$70,331.46 or $12M. He further stated that the relevant claim form and authorisation were submitted to the ministry for transmission to the Accountant General's Department to clear his outstanding advances. At the time of reporting in June 2003 there was no evidence to suggest that the ministry had taken any action on this matter.
The report says that the issuing of advances from the mission's operational funds for official conferences is not in keeping with the established procedures since funds are allotted for this purpose under the Ministry of Finance. The report recommended that official visits overseas be approved by Cabinet to ensure that funds are uplifted from the Accountant General. "This will obviate the need to utilise funds of the mission," the report points out.
For the Guyana Consulate in New York, the entire accounting functions were carried out by the Executive Officer responsible for finance and there was no segregation of duties. "The above situation cannot be regarded as a satisfactory arrangement from the point of view of ensuring that there are adequate checks and balances in the system and there is proper segregation of duties," the report states.
The Accounting Officer said that due to budgetary constraints, an additional officer could not be employed. This mission also faced problems in the payment of goods and services because of funds not being released in a timely manner from the head office.
At the Guyana High Commission in London, only two people staff the accounting unit and this resulted in a lack of proper segregation of duties, according to the report. The report suggests that a helpful measure would be to increase the staff level within the accounting unit by at least one officer. And this may mean reducing staff in less critical areas, such as the registry, to maintain a budgetary balance.
An unspent balance on remittances at the end of December 2002 totalling 5,651.70 Pounds Sterling was not paid to the Consolidated Fund. The report says that the balance was excluded from the cash book balance for the year 2003, but reported in the reconciliation as an amount due to the fund. In respect to the amounts remitted during 2002, an over expenditure of 14,267.49 Pounds Sterling occurred.