CIG Receives Clean Audit Across 43 Financial Statements

The Deputy Governor has taken note of the Office of the Auditor General’s (OAG) October 2022 report, Financial Reporting of the Cayman Islands Government: General Report 31 December 2021, the Office’s report on the 2021 Financial Audits. The report acknowledges that all public sector bodies submitted financial statements and annual reports for 2021 and the CIG shares the Auditor General’s “delight” that all the financial statements that have been audited to date have received unqualified audit opinions.

The OAG’s report has been issued to Members of Parliament and was posted today (17 October 2022) on the OAG’s website.

Financial Reporting of the Cayman Islands Government summarises the outcomes and status of the OAG’s financial audits of public bodies for the year ending 31 December 2021. It is issued in compliance with section 61 of the Public Management and Finance Act, 2020 Revision, which requires the OAG to present the results of all audits conducted and any significant matters to the House of Parliament.

Fifty public sector bodies – the Entire Public Sector (EPS) – submitted financial reports for the 2021 financial year. At the time of the OAG’s report, audits of 43 out of these 50 financial reports had been completed.

In her report, the Auditor General, Ms. Sue Winspear, said, “I am delighted that, to date, of those audited, all received unqualified audit opinions.” She also noted that she was, “pleased to report that public bodies now routinely prepare annual reports to accompany their financial statements and the laying of annual reports in Parliament improved in the 2020 and 2019 financial years.”

Ms. Winspear also found it noteworthy that, “since 2018 no core government entity has been issued with a qualified audit opinion” (noting that the audits for the Ministry of Health and Wellness are still backlogged). She attributed this improvement “to various factors, including the Deputy Governor’s leadership and the considerable efforts of the Chief Officers, the Chief Financial Officers, and their teams to restore financial accountability in the use of public resources.”

She further stated, “The quality of the financial information presented has steadily improved over the years. This improvement was demonstrated in 2019 and 2020 and continued in 2021”.

The Deputy Governor, the Hon. Franz Manderson, expressed his appreciation to the public servants. “I certainly share in the Auditor General’s sentiments. The unqualified opinions and improved quality of information she notes reflect the concerted efforts of the various teams to ensure the accuracy and completeness of the information submitted. I thank her for the recognition of the efforts of Civil Service staff, especially the finance teams of all public bodies.” 

The OAG completed audits on 19 core Government entities. Of these, all except three ministries, portfolios and offices recorded a surplus in 2021. Of the 24 audits completed on statutory authorities and government companies (SAGCs) for the same period, 17 recorded surpluses, six recorded deficits, and one broke even.

In addition to highlighting the outcomes and status of the financial audits, the report describes “the state of financial management and reporting in the Cayman Islands public sector over recent years and suggests improvements.”

Among the recommendations, the Auditor General calls for still further improvements in the quality of financial statements and the provision of disclosures (the latter of which she judged inadequate in some cases); improvements in the tabling in Parliament of the annual reports and financial statements, once audited; improving the quality of the consolidated financial statements of the EPS, and providing, in annual reports, an assessment of performance against outputs and outcomes agreed in budget documents.

The Deputy Governor said he valued the publication and noted its recommendations:

“I thank the Auditor General and her hard-working team of auditors for this report and for their diligence and professional ability which led to a record number of audits being completed by the statutory deadline.  I will continue to work with senior leaders to make further improvements, based on these recommendations, throughout the public service.

“One of her specific recommendations is to develop a comprehensive pre-election policy and protocols. The report does note that, in response, my office has drafted a formal policy entitled ‘Period of Election Sensitivity’, which was recently supported in Cabinet.  This policy is intended to provide clear information about how civil servants and ministers should conduct government business once an election has been called.”

Mr. Manderson concluded, “I thank my staff in the Deputy Governor’s Office, as well as the Chief Officers, CEOs, directors, senior leaders and Chief Financial Officers across both core government entities and SAGCs for their continuing work to ensure improvements in public sector financial management and reporting.”