Baarah Council failed to include complete financial data for 2021 in its 2022 financial statement: Audit Office

The Auditor General’s Office has stated that the 2022 financial statement of the HA. Baarah Island Council failed to include complete comparative information for the preceding year, 2021.

In the Auditor General's report on the 2022 financial statements of the Ha. Baarah Island Council, it was noted that while the framework for preparing council financial statements is mandated by the Public Finance Circular, these statements must be prepared in accordance with the "International Public Sector Accounting Standard: Financial Reporting under the Cash Basis of Accounting."

The report states that the circular mandates the submission of financial data from the previous year alongside the current year's financial statements. This requirement is intended to ensure that financial reporting aligns with the standards outlined in the regulations. Furthermore, the report noted that the circular requires the inclusion of comparative financial information from the preceding year to ensure that financial statements are prepared in accordance with the established standards.

The audit report highlighted that the council's 2022 financial statement failed to include comprehensive comparative data from 2021. Furthermore, it was noted that several columns designated for last year's expenditure figures were left blank, resulting in a significant omission of comparative financial information.

The Audit Office stated that while the Ministry of Finance issued a circular on February 27 outlining the framework for financial reporting—incorporating the information required under Section 35(a) of the State Finance Act—the island council has been instructed to prepare its financial statements in accordance with this structure and submit them to the Auditor General within three months of the end of each calendar year.

Furthermore, the Auditor General’s Office has instructed the council to manage its finances through the "Viya Module" in accordance with the guidelines set by the Local Government Authority (LGA). The council is required to ensure that all financial transactions and related information are regularly updated and accurately maintained within the system. The council has also been advised to prepare its financial statements and accompanying notes based on these records. Additionally, they must verify that the financial statements provide a true and fair representation of the institution’s total revenue, expenditures, and closing balances at the end of the financial year before submission.