No fi­nan­cial state­ments to ver­ify lotto fund spend­ing since 2015

-Au­di­tor Gen­eral’s re­port

Stabroek News Sunday - - NEWS -

Au­di­tor Gen­eral Deo­dat Sharma has de­clared that the ex­pen­di­ture of hun­dreds of mil­lions of dol­lars by the Guyana Lot­ter­ies Com­mis­sion can­not be ver­i­fied given the ab­sence of fi­nan­cial state­ments for the years 2015 to 2017.

The 2017 Au­di­tor Gen­eral’s re­port, which was pre­sented to the Na­tional As­sem­bly last month, noted that the last set of au­dited ac­counts was for the year 2013 and at the time of the cur­rent re­port, the Au­dit Of­fice was await­ing the signed fi­nan­cial state­ment for the year 2014 to fi­nalise the au­dit. “How­ever, fi­nan­cial state­ments were not pre­sented for au­dit for the years 2015 to 2017,” the re­port high­lighted.

It ex­plained that the Govern­ment of Guyana and Cana­dian Bank Note Ltd (CBN) en­tered into an agree­ment

es­tab­lish­ing a Govern­ment Lot­tery, which was or­gan­ised and con­ducted un­der the pro­vi­sions of the Govern­ment Lot­ter­ies Act. Un­der this agree­ment, CBN is to pay Li­cence fees equiv­a­lent to 24% of gross rev­enue.

The Guyana Lot­ter­ies Com­mis­sion, which was es­tab­lished in Au­gust, 1996 by a Cab­i­net De­ci­sion, man­ages the re­ceiv­able li­cence fees and en­sures that amounts spent are within the na­tional sec­tor and in ac­cor­dance with the guide­lines for ac­cess to the lot­tery fund­ing, the re­port said.

The Lot­ter­ies Com­mis­sion con­tin­ued to re­ceive pro­ceeds from the Lot­tery, which were used to make pay­ments ap­proved by Cab­i­net, it said, while adding that the Com­mis­sion is sub­ject to sep­a­rate fi­nan­cial re­port­ing and au­dit­ing.

Fur­ther, it was ex­plained that ac­cord­ing to the Re­ceipts and Dis­burse­ments State­ment of the Min­istry of Finance, for 2017, the Min­istry bud­geted $500 mil­lion for Lot­tery Re­ceipts un­der the cat­e­gory of Mis­cel­la­neous Rev­enue and amounts to­talling of $334 mil­lion were trans­ferred from the Com­mis­sion’s bank ac­count to the Con­sol­i­dated Fund.

Sim­i­larly, for 2016, $200 mil­lion was bud­geted, while amounts to­talling $600 mil­lion were trans­ferred to the Con­sol­i­dated Fund. It was noted that while the Min­istry of Finance has been bud­get­ing for Lot­tery Re­ceipts, the net re­ceipts are re­ceived at the end of the year.

Ac­cord­ing to re­port, amounts to­talling $145.578 mil­lion and $234.787 mil­lion were recorded as hav­ing been spent for 2017 and 2016, re­spec­tively.

The re­port pointed out that in the ab­sence of au­dited fi­nan­cial state­ments for the years 2015 to 2017, it was not pos­si­ble to “ver­ify the com­plete­ness, ac­cu­racy and va­lid­ity of the rev­enue and ex­pen­di­ture for the Guyana Lot­tery Com­mis­sion for those years.”

It was also noted that a spe­cial in­ves­ti­ga­tion was con­ducted by Spe­cial Or­gan­ised Crime Unit (SOCU) into the Lotto Fund.

The Finance Min­istry, in re­sponse, in­di­cated that the Finance Sec­re­tary would write the cur­rent Chair­man of the Lot­ter­ies Com­mis­sion re­quest­ing the sign­ing of the fi­nan­cial state­ment for 2014.

The Au­dit Of­fice, in turn, rec­om­mended that the Finance Sec­re­tary fol­low-up with the Guyana Lot­ter­ies Com­mis­sion to have the signed fi­nan­cial state­ments for the year 2014 sub­mit­ted in or­der to fi­nalise the 2014 au­dit and fi­nan­cial state­ments for the years 2015 - 2017 be sub­mit­ted to the Au­dit Of­fice for au­dit.

Last April, Chair­man of the Com­mis­sion, Nat­u­ral Re­sources Min­is­ter Raphael Trot­man, had opined that the com­mis­sion should be dis­solved as it was not func­tion­ing.

Trot­man told Stabroek News that the com­mis­sion had not met since its ap­point­ment in 2015.

He ex­plained that since there is only one lot­tery com­pany, CBN, the com­mis­sion is not re­quired to reg­u­late pay­ment of li­cence fees from sev­eral en­ti­ties, while other func­tions, such as reg­u­lat­ing the spend­ing of the amounts paid, is not a statu­tory re­spon­si­bil­ity of the com­mis­sion.

“Those du­ties have been taken on by the Min­istry of Finance, so there is re­ally noth­ing for the com­mis­sion to do,” Trot­man said.

Finance Min­is­ter Win­ston Jor­dan has re­peat­edly told Stabroek News that the com­mis­sion is re­quired to make de­ci­sions in re­la­tion to the fund and pro­vide the min­istry with a re­port of its de­ci­sions, while State Min­is­ter Joseph Har­mon told a postCabi­net press con­fer­ence that any de­duc­tions from the fund must first be ap­proved by the com­mis­sion, which would con­vey that rec­om­men­da­tion to the Min­istry of Finance. Ex­pen­di­ture for 2017 and 2016 from the Lotto Fund (Source: 2017 Au­di­tor Gen­eral’s Re­port)

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