Archer targets revenue reporting
(CNS): The finance minister has said that government’s inability to confirm that the revenue collected into the public purse is everything it is owed and recorded in its financial statements is a major challenge that he plans to tackle. Marco Archer told civil servants at a conference Thursday that after massive improvements in the public finances over the past three years, government must now target “revenue completeness” to ensure the cash due to government is accurately recorded and “revenue leakage is mitigated”.
Delivering the keynote address at the Professional Development Week conference for government accountants, Archer said that one of the main reasons why the government is still receiving an adverse audit opinion on the Entire Public Sector’s financial statements after huge improvement in the quality of accounts being produced is because the Office of the Auditor General (OAG) has “not been assured that revenues recorded in the Public Sector’s financial statements are complete”.
The minister said this was a symptom of a bigger problem, which was the inadequate or lack of internal controls to ensure that the risk of revenue leakage is mitigated and controlled.
“What is required is an assessment of our control environment at each revenue collection agency to determine the gaps in internal controls from the collection, recording and reporting of revenue,” he told the audience of government bean counters.
The next steps to address the problem will include an assessment of internal controls around revenue in government, the development of a risk management policy with respect to revenue and recognition by each revenue collection agency that it is their responsibility to ensure the completeness of their revenue., Archer said.
In his address, the minister outlined the impressive turnaround under his watch in improving public finances, from the standard of reporting to the fiscal prudence that has resulted in government currently having an operating cash balance of around $408 million, the highest balance ever for the Cayman Islands Government and a massive improvement on the $117 million it had in the bank when Archer took office.
But the minister had spoken earlier in his address about perfection in government’s financial management, and while a lot of work has been done, which he said was beginning to bear fruit, he admitted there was still more to do.
“It is absolutely crucial for the Cabinet and the wider public to be given timely and accurate financial information for the public sector in order to develop and implement sound and effective strategies for the country,” he said, noting that this was “easier said than done”.
But in addition to tightening revenue collection, controls and reporting, he also pointed to another major fiscal challenge for the public purse: the central government’s treatment of post-retirement healthcare costs.
“The amounts involved with this important matter are significant,” Archer stated. “Discussions with the civil service with respect to cost sharing arrangements – likely to include choice of healthcare service providers – are expected to be finalized by 2018.”
Overcoming the challenges will be difficult, he said, and warned that the audit opinion for the 2016/17 financial statements won’t be a “clean” one but he expects full compliance and a clean audit opinion for the EPS report in the 2018 fiscal year, when all plans and policies to improve compliance have had time to become fully effective.
Archer spoke about a cultural transformation in public service, with improved performance and accountability to help navigate the challenges ahead.
“We have a moral obligation to ourselves and future generations to do our best to make things better from a financial management perspective. I believe that we have done so over the last few years and we are now positioned to continue moving in that direction,” he said.
Minister Marco Archer’s Speech Professional Develoment Week 24 Nov 2016
Category: Government Finance, Politics
Here is an idea….
How about rolling back some duties so the country can start to heal and start to get some financial relief of our own. It’s clear the duties and filled your pockets now how about returning the favor.
The government needs to approve SAGC budgets instead of an ill placed board. Perhaps then you will recover the endless expense on attending numerous ‘meetings’ overseas first class, the excessive purchase of alcohol under ‘entertainment’ expenses and the excessive per-diem rates awarded by rank. Heads should be made to justify gains made from attending these global ‘meetings’ instead of just using the invitation as the only justification.
In regards to Civil Servants paying part of their Medical, it would seem to me that the priority should be to sort out the bad debt situation and finances at the HSA first, and recover the monies owed by those who abuse the system, and have no real allegiance or roots in the Cayman Islands. Civil Servants should be compensated for the 12 or so years their salaries have been frozen, which has affected them in so many ways, due to inflation and reduction of their real pension contributions.
To expect the CS to copay under these conditions while a “surplus” is being declared every year, only adds a further insult to a serious financial injury already inflicted upon them. Reduction of previous pension contributions will come back to bite government in the future as CS retire. No wonder many have to continue working, and cannot retire as shown recently in another report.
How about keeping track of spending while you’re at it? It’s an open secret that hundreds of millions have been misspent by civil servants and MLAs over the past decade. A lot of people got rich and saw the world from the windows of five star hotels among other things and a lot of votes and favors were bought without any accountability. Incompetence is too kind a word for it since it implies they didn’t know exactly what they were doing.
classic ppm…took them 4 years to to discover that someone else has to take a hard decision after the next election……zzzzzzzzzzzzzzzzzzzzzzzzz
It’s taken Marco the messiah four years as Minister of Finance to realize that the books are still a mess and government aren’t collecting all funds owed to them. Are there any qualified and competent CFO’s in the CS who understand professional standards and management accounting? I wonder if he’s read any of the AG’s reports on financial reporting?
I can’t wait for his next miracle and pronouncement of his brilliance.
“Revenue leakage” eh? Sounds like they need a plumber and some sealant.
Did it leak in Vegas in the Bush administration. Just wondering.
One would hope that keeping proper books, as an accountant, would not just be a moral obligation, but a professional obligation as well.
yeah congratulations…the last administration understood that “work permits for all” wasn’t necessarily good for Caymanians.
2.06 what was good for Caymanians? You seem to find it difficult understanding the real world…
Fix the damn dump Marco!
Took him 4 years to come up with this?
As far as I am concerned, this man should NOT be re-elected.
It is disgusting that these people suck the public purse dry and then they come up with excuses why they should have a second dip at the trough.
In the meantime, I am laying staff off because I cannot afford the Pensions that they will never receive anyway.
Is anybody out there FFS!!!!!!!!!!
Pension, health care, and vacation are all part of staff costs. If you can’t afford staff cost then close your business, there is no need to blame politicians because your business is unsuccessful.
If you can’t afford to pay Pensions it is probably time to close your business. How many years will it take you to come up with that?
Ask Bush. Marco inherited the problem.
How is having a $408 million as a cash surplus equate to sucking the pubic purse dry. Some times it is better to say nothing than to confirm you are in idiot,
Pubic purse?
If the CS don’t block it because its convenient for them to hide there mess, this is absolutely the way to go.
civil service…incompetence at all levels.
At least Marci is demanding accountability and proper standards. More than anyone before him did,