QV audit reveals waning revenue, liquor buying

WELLINGTON: An audit of a government property service has revealed declining revenue and hundreds of instances where company money was used to buy alcohol.

Quotable Value Ltd (QV) was at Parliament yesterday for its annual review.

MPs from across the political spectrum hammered board members over aspects of an audit report provided to the Primary Production Select Committee before the review.

New Zealand First MP Mark Patterson pointed out that the information provided by QV in its annual review was so sparse that it was almost meaningless.

‘‘If it wasn’t for questions and the work from the auditorgeneral, it would be almost impossible to know what’s going on in this organisation which has clearly got challenges,’’ he said.

The audit pointed to major issues with QV’s financial results and forecasting, saying the entity’s performance was below already lowered expectations.

QV’s group revenue has been declining or flatlining since 201112, and it fell another $2.37 million in the last financial year, down to $38.2 million for 201718. Its forecasts show a decline to $35.5 million next year, before rising again to $38 million in three years’ time.

QV chairwoman Raewyn Lovett accepted it did not have good systems in place, but said it had been undergoing a transformation, which meant things should improve.

Chief financial officer Greg Cate promised a staged rollout between now and the end of June to deal with the issues raised by the audit in regard to QV’s financial management systems.

‘‘Mostly related to automation of process and controls that you’d expect to see in a modern finance system, which we haven’t had in place for a few years,’’ he said.

National MP Hamish Walker questioned Mr Cate about what expenditure had caused concern.

‘‘Possibly it’s alcohol. They had some discrepancy on what is a reasonable level of alcohol which we’ve now defined and been clearer on,’’ Mr Cate said.

Upon further questioning Mr Cate said there were hundreds of cases where alcohol was pur chased to entertain clients.

Ms Lovett interrupted to say those cases were not all outside of policy and did not all contribute to the findings of the auditorgeneral.

But she said they had now ‘‘closed that gap’’ by removing the word ‘‘reasonable’’ from the entity’s guidelines around expenditure, and had now put in place guidelines for spending.

The audit summary also noted QV had ‘‘a number of breaches of legislative requirements, some more significant than others’’.

But Ms Lovett said they were ‘‘not very serious’’. — RNZ