Gary Spaulding, Senior Gleaner Writer
Improper and messy accounting practices combined have created opportunities for fraudulent activities and helped to toss the Caymanas Track Limited (CTL) into the financial hole in which it has found itself, an audit commissioned by the Public Accountability Inspectorate (PAI) division of the Ministry of Finance and the Public Service has found.
The audit found that the current payables accounting operation is ineffective and highly susceptible to infringements, errors and frauds.
"This process is also flawed in its operations and conformity to proper accounting principles and practices," the report stated.
The PAI charged that the lack of required documents for payments to be made is also in direct contravention of Section (5) Subsection (3) of the Financial Administration and Audit (FAA) (Instructions) Act.
The law states that "each payment of public money must be supported by a payment voucher or a claim which incorporates the details required for a payment voucher".
However, the investigators reported that they found that CTL breached the law as the name and address of payee were not available or documented on the payment voucher or on any supporting document attached.
The inspectorate also noted that information regarding the work performed, service rendered or details of the goods received were lacking on several payment vouchers inspected by the team.
CTL also reportedly failed to outline the service specified on some payment vouchers inspected by the PAI team.
"Several such breaches were noted for payments made in relation to the Misty Blue concert and for landscaping and stable repair services," the report stated.
The PAI complained that the supporting bills/invoices should be rubber-stamped "paid" and its correctness must be certified by an authorised officer but in many instances, not all the supporting documents attached to payment vouchers were appropriately cancelled (stamped PAID on all supporting documents).
"This practice increases the susceptibility of CTL to fraud and misappropriations by providing the opportunity for perpetrators to circumvent the detection process," the PAI warned in its report. "This could arise if all requirements of proper accounting and processing of transaction are not enforced by the accountable officer."
The PAI charged that CTL also breached Section 6:49 of the FAA Act which stipulates that inventories or stores ledgers recording the cost and dates of acquisition of all public property must be properly maintained to support the write-off of any losses or deficiencies.
The inspectorate also pointed to the absence of documentation in its fixed asset register in relation to a generator which was stolen in 2009-2010.