Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697817092149.pdf (Fiji)
ACCOUNTABILITY IN THE PUBLIC SECTOR THROUGH QUALITY AUDIT SERVICES REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS VOLUME 4 AUDIT REPORT ON GOVERNMENT MINISTRIES AND DEPARTMENTS- 2007 PARLIAMENTARY PAPER NO 9 OF 2014 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 20 Ministry of Local Government Urban Development & Public Utilities Programme Statement The Ministry is responsible for the formulation and implementation of local government and urban planning policies.
It also has responsibilities for National Fire Services.

The Ministry’s functions are categorized into the following programme areas: - General Administration Section, Local Government and Department of Town & Country Planning.

The National Fire Authority is also under the Ministry’s jurisdiction.
The Department of Water and Sewerage is responsible for the maintenance, operation, and expansion and upgrading of water and sewerage works and are anticipated to continue in various regions including the provision of new-metered connections, replacement of defective water meters and old water mains, connection of subdivisions, instrumentation repairs and land purchase.

The major project in this program is the loan funded Suva – Nausori Regional Water project.
For Sewerage, expansion and upgrading of works are programmed on Suva, Nadi, Pacific Harbour, Lautoka, Sigatoka and Labasa Schemes.

Other activities include the upgrading and replacement of existing system, sewer connections, and connection of subdivision, instrumentation repairs and land purchase.
Table of Contents 20.1 20.2 20.3 20.4 20.5 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditures ..................................................................... 2 Statement of Output Costs........................................................................................... 3 Appropriation Statement .............................................................................................. 3 Statement of Losses .................................................................................................... 4 AUDIT FINDINGS ................................................................................................................................. 4 Agency Financial Statements....................................................................................... 4 20.6 20.7 Non Submission of Trust Account Reconciliation......................................................... 5 20.8 Non Submission of TMA .............................................................................................. 5 MINISTRY OF LOCAL GOVERNMENT-HEADQUARTERS ................................................................. 6 Loss of Laptop by Minister ........................................................................................... 6 DEPARTMENT OF
6 DEPARTMENT OF WATER AND SEWERAGE- HEADQUARTERS .................................................... 7 Telephone Charges ................................................................................................. 7 DIVISIONAL ENGINEER-CENTRAL/EASTERN ................................................................................... 7 Unauthorised Purchases ......................................................................................... 7 DIVISIONAL ENGINEER -WESTERN................................................................................................... 8 Engagement of Temporary Officers......................................................................... 8 Stores Requisition Form (SR)................................................................................ 10 Vehicles Not Owned by the Contractor.................................................................. 12 Hire of Private Vehicles - Conflict of Interest.......................................................... 13 Non Rotation of Store men .................................................................................... 14 Stores Maintenance............................................................................................... 14 20.12 20.13 20.14 20.15 20.16 20.17 20.11 20.10 20.9 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 20.18 20.19 20.20 20.21 Discrepancies in Stores
 ......................................................................................... 16 Price Inflations ....................................................................................................... 17 Weaknesses in Tender Process ............................................................................ 18 Items taken for personal use ................................................................................. 20 DIVISION ENGINEER NORTHERN.................................................................................................... 21 Engagement of Project Workers ............................................................................ 21 20.22 Excessive Overtime Hours Carried Forward.......................................................... 22 20.23 Procurement Authority ........................................................................................... 24 20.24 Private Hire of Vehicles ......................................................................................... 24 20.25 20.26 Item not taken on charge ....................................................................................... 26 Appendix 20.1 – Statement of Output Costs........................................................................... 28 Appendix 20.2 – Items Purchased Without Local Purchase Orders........................................ 34 FINANCIAL STATEMENT 20.1 Audit Opinion The audit of the 2007 accounts of the Ministry of Local
 Government Urban Development and Public Utilities resulted in the issue of a qualified audit report.
The qualifications are as follows.

1.

The amounts reflected in the Statements of Output Costs have been estimated as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

It is not possible therefore to determine the accuracy of the expenditures incurred by the Ministry under each output.

2.
2.

The Ministry has not provided the following statements contrary to section 82(1) of Finance Instructions: (i).

Trust Account Statement of Receipts and Payments; (ii).

Profit and Loss Statement for Trading Operations of Joinery and Plumbing; and (iii).

Statement of Losses.

20.2 Statement of Receipts and Expenditures The Ministry of Local Government Urban Development and Public Utilities incurred total expenditures of $77,127,438 in 2007 compared to $106,199,900 in 2006.
Details are shown in table below.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description RECEIPTS State Revenue Operating Revenue Agency Revenue Miscellaneous Revenue Sales of School Farm Produce 2007 $ 2006 $ 17,218,358 334,012 222,483 0 0 0 TOTAL REVENUE 17,440,841 334,012 EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Expenditures Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 4,369,844 7,559,694 104,508 25,275,727 86,818 1,604,800 102,808 39,104,199 4,842,600 9,938,400 368,700 29,462,200 199,900 3,986,700 420,400 49,218,900 29,543,364 41,867 496,195 30,081,426 44,663,400 16,500 1,645,000 46,324,900 Value Added Tax 7,941,813 10,656,100 TOTAL EXPENDITURES 77,127,438 106,199,900 20.3 Statement of Output Costs The Department consolidated its expenditures into 11 Statement of Output Costs.
These are detailed in Appendix 20.1.

20.4 Appropriation Statement The Ministry of Local Government Urban Development and Public Utilities incurred expenditures totalling $77,127,438 in 2007 against the budget of $118,771,504 resulting in a savings of $41,644,066 or 35%.

Details of expenditures against the budget estimates are provided below.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Budget Estimate $ 4,205,900 7,464,300 141,800 25,376,600 48,000 Changes $ 0 6,047 (6,047) 0 0 Revised Estimate $ 4,205,900 7,470,347 135,753 25,376,600 48,000 Actual Expenditure $ Carry – Over $ 4,369,844 7,559,694 104,508 25,275,727 86,818 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase Services Operating Transfers Special Expenditures Total Operating Costs Grants of Goods & 8 9 10 Capital Expenditure Construction Purchases Grants & Transfers Total Capital Expenditure 13 Value Added Tax & 1,605,000 650,000 39,491,600 65,775,000 41,900 500,000 66,316,900 12,963,004 TOTAL EXPENDITURE 118,771,504 20.5 Statement of Losses Lapsed Appropriation $ (163,944) (89,347) 31,245 100,873 (38,818) The Ministry did not submit any loss of assets during the financial year ending 31/12/07.
AUDIT FINDINGS 20.6 Agency Financial Statements Each agency must include the following statements in its annual financial statements: • Statement of Receipts and Expenditure • Statement of Output Costs • Statement of Losses • Trust Account Statement of Receipts and Payments (where applicable).1 The Agency Financial Statement submitted by the Ministry did not include the following statements: • Statement of Losses • Trust Account statement of Receipts and Payments Recommendation The Ministry should ensure that the requirements of the Finance Instructions are complied with at all times.
1 Finance Instructions 2005 82 (1) Ministry of Local Government Urban Development and Public Utilities Section 20: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Ministry’s Comments 20.7 Non Submission of Trust Account Reconciliation Each month, the trust account shall be balanced and reconciled with the trust bank accounts.

The names and balances of each account shall be listed and the reconciliation shall be signed by the responsible Ministry.
Unreconciled items should be investigated and resolved promptly.

2 The Ministry did not submit the following Trust Account Reconciliation for audit verification: • Main Trust Account Reconciliation • Department of Water’s trust reconciliation for two divisions The Department did not prepare the Main Trust reconciliation as they were not aware of its existence.

The reconciliation was also not submitted to audit as the divisions did not provide their reconciliations to headquarters.
The absence of reconciliation of Trust records could result in overpayments made being undetected and could also be an impetus for fraudulent activities.

Recommendation The Ministry should ensure that Finance Instructions is adhered to at all times.
Ministry’s Comments 20.8 Non Submission of TMA Each agency operating a trading and manufacturing activity must prepare- a) quarterly profit and loss statements; and b) a balance sheet on an annual basis The annual profit and loss statement and balance sheet must be prepared on an accrual accounting basis.3 The Ministry did not submit the trading and manufacturing account reconciliation for verification of the accounts.
Despite numerous reminders by Headquarters, the Water Supply department failed to submit the reconciliation.

The Ministry has no knowledge of the operations and profitability of the department’s TMA.
2 Finance Instructions 2005 69 (3) 3 Finance Instructions 2005 37 (1) (2) Ministry of Local Government Urban Development and Public Utilities Section 20: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation The Ministry should ensure that Finance Instructions is complied with at all times.
Ministry’s Comments MINISTRY OF LOCAL GOVERNMENT-HEADQUARTERS 20.9 Loss of Laptop by Minister Every Head of Department shall ensure that the inventory ledger maintained in his department is kept up to date by recording the receipt of new items and the deletion of items returned, written-off or otherwise disposed of and the authority for the deletion of any item shall be recorded in the inventory ledger.4 The former Interim Minister, Hon.
Jone Navakamocea did not return his official laptop valued at $3,198 after he vacated this office.

He claimed that the laptop was lost, however a Losses Report was not prepared.

Also, the matter was not reported to Police.

Moreover, the laptop was not recorded in the Minister’s inventory ledger.

In the absence of a losses report, the former Minister’s claim could not be substantiated.
Also, there is a risk that items purchased being subject to theft or lost if not recorded in the inventory ledger and at the same time the Ministry may find it difficult to claim ownership.

Recommendations • The inventory ledger should be updated upon purchase of inventory item.

• A losses report should be prepared immediately after a loss is discovered and where necessary this should be reported to police.
• Every effort should be made by the Ministry to recover the cost of items taken away by the former Minister.

Ministry’s Comments There is record of laptop in the inventory ledger but without any particulars entered.

Refer page 96 of Inventory ledger.

It has been updated for your inspection.

The former Interim Minsiter, Mr. Jone Navakamocea through email on 09/01/08 at 10.12am advised Mr. Tuiloma for the loss of the laptop.

A copy of the email attached.


Our correspondent to former minister please refers file No.

701/19 of 27th February, 2008 for lost laptop and a memo to Secretary to Cabinet attached.

4 Supplies and Services Instructions and Government Stores Instructions 89 (1), (2), (3).

4 Supplies and Services Instructions and Government Stores Instructions 90 (1), (2).
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DEPARTMENT OF WATER AND SEWERAGE- HEADQUARTERS 20.10 Telephone Charges The Finance Circular No.

17/2000 was a measure put in place to address the escalating telephone charges incurred and the unauthorized use of phones.
Telephones must not be used by officers for private purposes.5 An employee must behave honestly and with integrity in the course of employment in the Public Sector.6 The Department had issued mobile phones to all the divisional heads however none of the phones were entered in the inventory ledger.

There is also no policy on the use of mobile phones and there is no verification to identify official and personal calls.
Absence of proper policy on the use and user limits implies no control on usage of phones.

There is serious risk that the Department is paying for the unofficial calls made.

Recommendations • • Only official calls made by users should be paid by the Department.

Every effort should be taken to verify the official and unofficial calls and users should be asked to pay for the unofficial calls.

Department’s comments All bills are verified and certified by the mobile holders before any payment is made.
DIVISIONAL ENGINEER-CENTRAL/EASTERN 20.11 Unauthorised Purchases A local purchase order, indent, departmental warrant, contract or agreement must be issued before goods, services and works are received.7 Items valued at $114,652.65 were supplied to the division without the issue of local purchase orders in 2006.

This was detected when the suppliers submitted their claims to the division in 2007.

These items were stated to have been ordered during emergency cases.
For details please refer to Appendix 20.2 to this report.

A summary of claims by suppliers are shown in the Table below.
Company Viti Civil Engineering Supplies Ltd Pacific Safety & Industrial Supplies Pacific Pipelines & Road care Ltd Atrax Civil Supplies Innovative Marketing (Fiji) Ltd Mataisau Engineering & Civil Supplies Amount ($) 42,632.60 4,915.00 10,623.25 9,206.00 13,772.50 33,503.30 5 General Order 1113 (b)25.2732728 6 Public Service Code of Cond50.48uct- Part 2, Section 6 (1) 7 Finance Instruction 2005 Section 17 (2) Ministry of Local Government Urban Development and Public Utilities Section 20: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Company Total Amount ($) 114,652.65 The value of some items supplied need the approval from higher authorities before purchases are made which in this case was bypassed as no local purchase order was issued.
The purchase of 48 pairs of safety shoes (valued at $5,380.80) from Mataisau Engineering & Civil Supplies could not be treated as an item required in emergency cases.

The above was made possible since officers at the stores failed to verify the items received against the orders issued by the department but continued to receive the items deliberately.
Given the sum involved, there is a risk of unnecessary purchases being made and collusion amongst officers at the department and suppliers to defraud the government.

Proper procurement procedures were not followed which led to unauthorised purchases.

Recommendations • • An investigation should be carried out on the ordering of the above items and surcharge actions taken against responsible officers.
Local Purchase Orders must be issued before goods and services are acquired and any deviation from the procedure by any Ministrys should be disciplined accordingly.

Department’s comments Unauthorised purchases took place in 2006.

Where procedures were not followed resulted in goods obtained were not paid for by the division.

As in the past, this was one area that used to be the practice in Suva water supply.
From 2005 we have convened meetings with the suppliers that we are not going to be held responsible for any such purchases and they agreed that this should stop immediately.

The Division Engineer addressed this issue both with the supervisors and suppliers that that any uplift of items during emergencies must be approved first by him and to be regularized immediately in the next working day.
Unfortunately, this had come up again, but all the submissions and queries have been referred to higher authorities for further actions and decisions.
DIVISIONAL ENGINEER -WESTERN 20.12 Engagement of Temporary Officers Part time employees shall be served a letter of appointment by a Ministry/Department which shall include amongst other things, his/her rate of pay, duties in which the employee is engaged, the hours, days and duration.8 There were excessive temporary government wage earners engaged for the Divisional Water Engineer Western.
An analysis of government wage earners engaged for the months of January to November 2007 for the Department of Water and Sewerage in the Western Division are shown in the table below.
SECTION Accounts Personnel Hydrology Water Rates Lautoka W/S JAN 6 5 16 14 81 FEB 7 5 16 17 84 MAR 7 5 16 18 119 APR 8 5 16 24 126 MAY 8 5 16 26 163 JUN 8 5 16 28 166 JUL 8 5 16 28 165 AUG 8 5 16 28 172 SEPT 8 5 16 29 170 OCT 8 6 16 29 155 NOV 10 6 16 29 178 8 Conditions and Rules of Employment for Government Wage Earners 4 (a) Ministry of Local Government Urban Development and Public Utilities Section 20: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 JAN 43 26 38 48 SECTION Ba W/S Rakiraki W/S Nadi W/S Sigatoka W/S Tavua W/S Natabua Sewerage Sigatoka Sewerage Ba Sewerage 12 21 Nadi Sewerage Total 31 21 4 366 FEB 50 26 45 47 29 21 4 12 21 MAR 49 31 51 47 32 20 4 12 21 APR 61 31 51 48 32 20 4 12 26 MAY 61 37 50 57 48 23 4 19 27 JUN 70 38 57 55 48 26 6 19 27 JUL 70 39 68 76 48 31 7 21 31 AUG 70 39 68 96 48 34 11 20 35 SEPT 54 39 69 95 OCT 53 39 69 94 NOV 67 48 70 78 55 34 14 19 35 55 33 15 21 35 55 35 15 21 35 384 432 464 544 569 613 650 642 628 663 Out of the 663 workers engaged in November, only 128 were permanent officers while 535 were temporary workers.
The following anomalies were also noted.

• • • • There was no approved staff establishment provided for the Divisional Water Supply and Sewerage Western.

Hence, there is no control over the recruitment of temporary officers.

There was no job description maintained for each job classification and this was not issued to each officer when appointment is made.

Some officer’s have assistants which audit considered unnecessary, e.g.

assistant clerks, assistant dispatcher, and assistant time clerks.
Some officers were employed in areas other than what is stipulated in their engagement letter.

Examples are as follows: Name Timaima Dravo Mereseini Mataluvu FNPF NO.

XY528 UF489 Engagement Capital Projects Clerk B Maria Rokotuinaceva 3031w Uraia Koroi Salabale Kadivuka Lanieta Roko XU716 VL 373 VM069 Relieve staff during Christmas break for 3 weeks w.e.f.

21/12/06.
21/12/06.

Trade Assistant Assisting store man Capital Projects Engaged as Clerk Engineer’s Duties Performed Stores Assistant Divisional Secretary Chainman in the Hydrology Section for one year.

Engaged in Leakage Section.

Time Clerk Stores Assistant There is a lack of control in the appointment of temporary officers at the division and there is a risk that the process could be abused.
Recommendation • • • The approved staff establishment for the Western Division should be observed and Job Description should be clearly drawn for all government wage earners positions.

For casuals/temporary officers, the duration for engagement and particulars of role to be explicitly stated in appointment letters.

Appointment of assistant clerks must be ceased immediately.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Division’s Comments The Water & Sewerage Department in the Western Division has a provision of two hundred and forty seven [247] Government Wage Earners approved under the Nominal Roll.
One hundred and twenty eight [128] stated in the report are permanent employees and the difference of one hundred and nineteen [119] are vacant positions where employees are held against.

This situation developed as a result of an instruction to discourage the filling of vacant positions in the last few years due to the proposed reforms for the Department; however this seems uncertain due to the changing policies of the Government.
Secondly, the current establishment for WSD in the West have been there for more than twenty [20] years while the coverage of our operation has expanded with new infrastructures being built.

This includes construction of new reservoirs and treatment plant, in addition to the extension of water pipeline to provide water supply to cover wider areas.

Additional workmen were taken in to man the increased activity undertaken due to the expansion of operations in the Division.
Besides the above the six hundred and sixty three [663] workers are also inclusive of capital jobs undertaken in the Division.

The labour strength from January to June this year is shown in the Table below.

This is indicative of the normal labour strength before we receive funding for capital projects, which will require recruitment of additional workmen.

The audit suggestions above are noted and adjustments are now being made to address the concerns raised.
WATER & SEWERAGE DEPARTMENT WESTERN DIVISION LABOUR STRENGTH - (JAN - JUNE ) ACCOUNTS PERSONNEL SECTION HYDROLOGY WATER RATES LAUTOKA WATER SUPPLY BA WATER SUPPLY RAKIRAKI WATER SUPPLY NADI WATER SUPPLY SIGATOKA WATER SUPPLY TAVUA WATER SUPPLY NATABUA SEWERAGE SIGATOKA SEWERAGE BA SEWERAGE NADI SEWERAGE TOTAL JAN 8 6 13 12 93 46 27 38 50 29 21 7 7 20 377 FEB 8 6 13 12 87 46 27 38 48 28 21 7 7 20 368 MAR 8 6 13 11 91 46 27 38 48 28 21 7 7 19 370 APRIL 8 6 13 11 96 44 27 38 48 28 22 7 7 19 374 MAY 8 6 13 18 119 47 27 48 63 28 26 10 7 20 440 JUN 8 6 13 19 124 48 26 48 64 28 26 10 9 20 449 20.13 Stores Requisition Form (SR) Upon identifying a need for a specific task to be carried out, the supervisor identifies stores, plant, machinery, and vehicle required to accomplish that task.
If the vehicle or plant is not available in the section than a request is made through a Stores Requisition (SR) form, detailing the particulars of the type of vehicle or plant required for the task.

Ministry of Local Government Urban Development and Public Utilities Section 20: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Stores Requisition forms were completed after the receipt of contractor’s invoice and statement.
The requisition forms would always quote the period on which the vehicles were hired implying that the Stores Requisitions were completed after the services were rendered.

The following table shows examples from the sample scrutinized.
Invoice Number Total Paid LPO # LPO Date 742907 17/05/07 742908 17/05/07 742908 17/05/07 742908 17/05/07 742908 17/05/07 742908 17/05/07 742910 17/05/07 742910 17/05/07 742910 17/05/07 742910 17/05/07 742910 17/05/07 739379 15/06/07 LPO Date Vehicle # EJ 848 EL767 EL767 EL767 EL767 EL767 EL 767 EL 767 EL 767 EL 767 EL 767 DF 656 Vehicle # SR Date 25/04/07 25/04/07 25/04/07 25/04/07 25/04/07 25/04/07 15/05/07 15/05/07 15/05/07 15/05/07 15/05/07 11/6/2007 Invoiced Date 10/4/2007 16/04/07 17/04/07 18/04/07 19.04.07 20/04/07 23/04/07 24/04/07 25/04/07 26.04.07 27/04/07 1/5/2007 3839 3891 3892 3893 3894 3895 3438 3439 3440 3441 3419 4042 LPO # 739861 739861 739861 739861 739863 739863 739863 739863 739863 739864 739864 739864 739864 739864 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 12/6/2007 AP 399 Company Name Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging Amars Digging SR Date 11/6/2007 11/6/2007 11/6/2007 11/6/2007 11/6/2007 11/6/2007 11/6/2007 11/6/2007 11/6/2007 29/05/07 29/05/07 29/05/07 29/05/07 29/05/07 Invoiced Date 29/05/07 30/05/07 31/05/07 1/6/2007 21/05/07 22/05/07 23/05/07 24/05/07 25/05/07 14/05/07 15/05/07 16/05/07 17/05/07 18/05/07 162.75 150.15 143.20 138.25 160.90 138.40 151.75 157.30
 155.20 168.30 198.50 108.45 Invoice Number 1376 1377 1379 1380 1371 1372 1373 1374 1375 1366 1367 1368 1369 1370 Total Paid 133.20 133.20 133.20 118.40 133.20 133.20 133.20 133.20 118.40 133.20 133.20 133.20 133.20 118.40 Senior Cargo LPO # 701468 701468 701468 701468 701468 701468 701468 701468 701468 701468 701469 LPO Date Vehicle # 1/3/2007 BM 217 1/3/2007 BM 217 1/3/2007 BM 217 1/3/2007 BM 217 1/3/2007 BM 217 1/3/2007 CF 992 1/3/2007 CF 992 1/3/2007 CF 992 1/3/2007 CF 992 1/3/2007 CF 992 1/3/2007 CF 992
 PERIOD OF HIRE 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 19/02 - 23/02 24/02 - 02/03 SR Date 28/02/07 28/02/07 28/02/07 28/02/07 28/02/07 28/02/07 28/02/07 28/02/07 28/02/07 28/02/07 26/02/07 Invoice Date 19/02/07 20/02/07 21/02/07 22/02/07 23/02/07 19/02/07 20/02/07 21/02/07 22/02/07 23/02/07 24/02/07 Invoice # 1054 1055 1056 1057 1058 1154 1155 1156 1157 1158 1159 AMOUNT $ 108.00 108.00 132.00 168.00 144.00 120.00 108.00 108.00 168.00 156.00 150.00 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 LPO # 701469 701469 701469 701469 701469 LPO Date Vehicle # 1/3/2007 CF 992 1/3/2007 CF 992 1/3/2007 CF 992 1/3/2007 CF 992 1/3/2007 CF 992 PERIOD OF HIRE 24/02 - 02/03 24/02 - 02/03 24/02 - 02/03 24/02 - 02/03 24/02 - 02/03 SR Date 26/02/07 26/02/07 26/02/07 26/02/07 26/02/07 Invoice Date 25/02/07 27/02/07 28/02/07 1/3/2007 2/3/2007 Invoice # 1160 1161 1163 1164 1165 AMOUNT $ 144.00 156.00 108.00 108.00 114.00 The monitoring and control mechanism of the division is susceptible and it can be safely assumed that the requisition plays an insignificant role in that the payments can be effected without the need for a requisition.
A dangerous precedent has been set where government accounting procedures had been activated by the contractor’s invoices and statement and especially when the Stores Requisitions were raised on a later date.

Recommendations • • The department should be more vigilant and enforce compliance with regards to the raising of the Store Requisition.

Disciplinary action should be taken against officers for circumventing government procedures in respect Stores Requisition.
Division’s Comments On the approval of the Divisional Head, Plant/Vehicle Instructions are issued daily to drivers and operators according to the need for the hire before they are allowed to work.

This is generally taken as authority to be officially engaged by the Department.

Instruction has been issued to all supervisors and store men and the need to comply with the procedures and a warning to them of disciplinary action if they fail to comply with the procedures in future.
20.14 Vehicles Not Owned by the Contractor The contractors need to state clearly the registration numbers and proof of ownership of the vehicles.

Failure to provide copies of valid proof of ownership may render the tender invalid.

The following two vehicles were hired under the name of Amar Digging Works; however vehicle search with the Land Transport Authority confirmed that these vehicles do not belong to Amars Digging Works.

For example refer tom Table below.


Registration Number AP 399 BS 759 Owner’s Name Type of Vehicle Total Amount ($) Paid for the Hire Mr. Shiu Nadan Mr. Shiu Nadan Tractor Front End Loader 8,849.68 16,270.50 The department failed to engage the contracted vehicles and allowed Amars Digging to use other vehicles which did not belong to them.
Allowing Amars Digging to engage vehicles outside the contracted vehicles list is viewed as an attempt to circumvent the tender procedures as a contract was already in place and contractors would be forced to forgo privileges under these arrangements.

The presence of collusion cannot be ruled out.


Ministry of Local Government Urban Development and Public Utilities Section 20: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • Only approved vehicles should be engaged.

• Disciplinary action should be instigated against officers responsible for engaging the vehicles outside the contracted vehicles.
Division’s Comments The two machines were approved by the Tender Board as additional to Amar’s Digging Works initial contract.

The department had undertaken the necessary physical inspection of all tendered plants and vehicles in the tender evaluation phase; however physical inspection of additional plants and vehicles are carried out by the secretariat.

The department will hire the plants when required for maintenance or construction purposes.
20.15 Hire of Private Vehicles - Conflict of Interest An employee must disclose, and take reasonable steps to avoid, any conflict of interest (real or apparent) in connection with employment in the public service.9 A person must not in the course of employment in the public service provide false or misleading information in response to a request for information that is made for official purpose.
An employee must not make improper use of official information or of the employee's duties, status, power or authority in order to gain or seek to gain, a benefit or advantage for the employee or for anyone else.10 An employee must behave honestly and with integrity in the course of employment in the public service.11 Mataika Transport Co. (Fiji) Ltd was awarded the contract for hiring 4 x 2 utility (Single Cab) and Light Truck (Twin Cab) vehicles.
Audit noted that Tomasi Mataika (JA 449), a Leading Hand at Lautoka Water Supply is one of the Directors and shareholder for Mataika Transport Co (Fiji) Ltd.

The non disclosure of vested interests by Tomasi Mataika is viewed as serious and deliberate attempt to gain benefits financially and was a conflict of interest considering his responsibility as the Leading Hand.

Recommendations • Ministry should carry out internal investigations regarding these unethical and fraudulent dealings.
• Instigate appropriate disciplinary action against the Transport Officer and others for breach of the Public Service Code of Conduct.

Division’s Comments According to Tomasi Mataika, even though his name appears as a Director of the company, he is not shareholder in the company as mentioned in the report since he did not make any financial contribution to the company.

Moreover, he has no benefit from the company.

Attached, please find his declaration.


9 Public Service Act s.6 10 Public Service Act-1999, Section 10 11 Public Service code of conduct section 6(1) of PSC act-1999 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 20.16 Non Rotation of Store men Rotation of duties is an internal control mechanism to prevent officers from taking advantage of their position in locations for too long.
Officers in long periods in one location tend to build relationships with suppliers and get the know-how of circumventing the system to gain advantage for them.

Most Storemen in the western division had been serving in such position for more than 3 years in their current location and this increased the risk of abuse of office.
Refer to the table below for examples: Station Name EDP/FNPF Current Post Ba Water Supply Lautoka Water Supply Josese Nabuta Isimeli Waibuta Natabua Sewerage Nadi Water Supply Sigatoka Water Supply Nadi Water Supply Nadi Sewerage Hydrology Nemia Vucago Ashwin Lal R C Nair Permal Pillay Panapasa Vecenabuka Tuvili ON468 90225 60820 PZ946 FR592 58140 HS419 Storeman Clerical Officer - Probation Storeman Storeman Storeman Storeman Storeman HM152 Storeman Duration in current post 4 7 9 9 9 15 17 19 Management has failed to ensure rotation of storemen and this increases the risk of officers taking advantage of the poor internal controls.
Recommendation Management should rotate the storemen in the Western Division as they have been in their current position for too long.

Division’s Comments The idea of rotating the store man was brought up last year which required all store man to submit their Curriculum Vitae to the Personnel Officer.

The difficulty is that a majority of our store-persons are Government Wage Earners.
However, the Personnel Section is liaising with headquarters on the best possible way of accommodating the rotation considering the fact that this will affect the place of residence for most of them.

We are in the process of reshuffling them within the Division, and also with the other two Divisions where possible.
20.17 Stores Maintenance Every storeman/woman is responsible to keep all store records up-to-date, especially the tally cards and all relating documents; furthermore he or she is responsibility to ensure that all items placed in the stores are kept properly.

Every storeman/woman is responsibly to adhere to the general stores rules and regulations.

The records at the Natabua Sewerage had not been maintained properly and stores could not be properly accounted for.
Refer to the anomalies mentioned below: • Tally card at the Natabua Sewerage general stores was not filled for all the items purchased during 2007.

While for the electrical stores tally cards were not filled since July 2007.

• Many worn out parts were kept with the current stores items in the electrical stores in contravention with the supplies and stores instructions.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • Both the store personnel at Natabua failed to keep proper record of the internal requisition and delivery dockets.
• Items were taken from the Supplier by the workmen and delivered directly to the site for repair or maintenance works without his/her signing the delivery docket or physically verifying that the correct items have been received.

• The general stores and electrical stores were in a disorganized status and could lead to difficulties in locating the supplies which could contribute to uneconomical ordering of supplies.
• Both the store officers failed to carry out regular stock takes of all public stores under their control.

• In the absences of the store lady, Salesh the electrician at Natabua Water Supply would sign the delivery docket, even though he is not authorized to.

Also Salesh is the person who requests the items to be purchased.

• The lack of supervisory checks was evident.

The non compliance by the store officers at Natabua Sewerage are a catalyst for abuse of position and office.
The problems above are serious and long outstanding which have not been resolved by management.

Recommendations • Management should remove both officers from their current storeman posts and revert them to their former posts and hire qualified storemen.

• Management should ensure that the storemen are rotated within the Division.

• Both the mentioned officers should be disciplined accordingly for the non compliance of stores procedures.
• Management should review the position description of the store officers in the western division as a whole and introduce segregation of duties to strengthen the internal controls.

Department’s comments The electrical stores tally cards were not filled after the stores-lady went on overseas leave to Australia and never returned.

The replacement store-lady had to update records from June 2008.

All records have been updated with items placed in proper storage.
Damaged and worn out equipment are kept separately since these items can not be disposed until approved by the Ministry of Finance through a Board of Survey.

In a workshop conducted with the Ministry of Finance in April this year, all store man and chief clerks have been instructed to do stock takes in the last working day of every month.

The department is initiating moves to set up a central store to minimize discrepancies.

A warning letter has been issued to the store man at Natabua Sewerage.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 20.18 Discrepancies in Stores An employee must act with care and diligence in the course of employment in the Public Service.12 An employee must behave honestly and with integrity in the course of employment in the public service.13 Every officer shall be personally responsible for public stores under his control and may be surcharged in respect of any loss of public stores resulting from negligence.
Audit spot checks at the Lautoka Water Supply and Natabua Sewerage revealed short supply of items by suppliers on different occasions within a week.

Refer below for the details.

Store Date 28/11/07 Items/supplier Qty Delivery Docket No.

4190 LPO 743398 (delivery docket not produced) 3621 4/12/07 5/12/07 11471 7/12/07 10541 Natabua Sewerage Lautoka Water Supply Value ($) 400 Received By Lanieta 450 Remarks Item short supplied after physical check on 6/12/07.
Item paid for but not received as physical check by audit on 6/12/07.

695 Salesh Not delivered 799.72 Isimeli Waibuta Short delivery 1 2 1 4 22 1,773 Isimeli Waibuta Short supply 16mm PVC single white cable.

Overload 14-42 Amps range phase failure relay 200mm Super Coupling purchased from Atrax PVC Pipes purchased from Rattan Enterprises The two main stores receiving process are seriously flawed and have been defeated through collusion with suppliers.
Recommendation Disciplinary action should be instigated on all the officers who were involved in the magnitude of irregularities with 5 random spot checks all confirming short supply.

Department’s comments Individual comments on the issues raised are set out in the following table: Store Natabua Sewerage Store Date 28/11/07 Delivery/LPO Item 4190 LPO 743398 PVC white 16mm single cable Overload 14-42 Qty 1 2 Remarks has item The been delivered and is in stock.
purchased items The from is 0- the LPO 60,lapse 300 amps meter and not the one quoted in the report.

The item is 12 Public Service Act No.

8 of 1999.


13 Public Service code of conduct section 6(1) of PSC act-1999 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 4/12/07 3621 Phase relay failure 1 Lautoka Water Supply 5/12/07 11471 200mm Coupling Super 4 7/12/07 10541 PVC pipes 22 to taken TOC.
The phase failure relay to Nadi was sewerage due the urgency of overflow of the Narewa Outfall which was overflowing at that time.

Of the 4 ordered , two were used at Loma lane and 2 were TOC in the stores.

The breakdown of the PVC include 15x2”, 15x3”, 10x4”, 7x6”.A total of 47 pipes were purchased and not 22 as mentioned in the report.
pipes 20.19 Price Inflations Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.

Prices of items purchased during the year were always fluctuating and frequently very exorbitant increases within months were experienced.
Refer to Table below for examples: Item 8” PVC Bend 6” PVC Bend 3” Duck foot Bend 8” PVC Saddle Clip 8” AC Saddle Clip 3”U/f Hydrant 8” Dressing Kit 6” Dressing Kit ½” Poly Union 4” f/ a/ Socket 3” f/ a/ Socket Previous Supplier Current Supplier Island Electric Island Electric Atrax Civil Supplies Atrax Civil Supplies Atrax Civil Supplies Vinod Patel Road Works Road Works Atrax Civil Supplies Wilton Civil Supplies Road Works Island Electric Island Electric Island Electric Road Works Island Electric Atrax Civil Supplies Road Works Atrax Civil Supplies Island Electric Island Electric Road Works Previous purchase Price 780.00 Current purchase Price 1,280.00 Price Increase % Increase Duration between purchase Less than 6 months Less than 6 months 1 day Less than 3 months Less than 2 months Less than 3 months Less than 3 months Less than 6 months Less than 2 months Less than 5 months Less than 1 months 64 123 220 44 53 298 395 59 350 210 41 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Item Previous Supplier Current Supplier 6” f /a/Socket 4” AC-PVC Adapter 8”AC-PVC Adapter 10” Adapter 12” Adapter AC-PVC AC-PVC Road Works Island Electric Atrax Civil Supplies Road Works Island Electric Island
 Electric Atrax Civil Supplies Island Electric Island Electric Altrade Auto traders Previous purchase Price 160.00 Current purchase Price 430.00 Price Increase % Increase 270.00 78.00 178.00 100.00 178.00 380.00 202.00 355.00 680.00 325.00 248.00 745.00 497.00 200 169 128 114 92 Duration between purchase Less than 3 months Less than 2 months Less than 1 months Less than 1 months Less than 1 months Government is been charged exorbitant prices with unrealistic price increases.
Recommendations • • Management should include all the items above in their tender list as the above items are constantly used so as to control the purchase price of the items.

Management should investigate the exorbitant increase.

Department’s comments The Department cannot dictate the price set by any one supplier.
The chance of people colluding with the suppliers is very minimal as all companies submit their quotes in sealed envelope and are placed in the tender box provided for this purpose in the main office.

In addition there is a public opening where the envelopes are opened in the presence of suppliers who wish to witness the opening of tenders.

The department itself finding it hard to purchase certain fittings as suppliers take control of their costs.
20.20 Weaknesses in Tender Process All tenders shall be advertised on at least two days in a daily newspaper published in Fiji.14 All tender boxes shall be equipped with two separate and different locks, the key for one of which locks shall be held by the Chairman of the relevant tender board and the key for the second of which locks shall be held by the secretary of that tenders board.15 A person must not in the course of or in connection with employment in the public service, provide false or misleading information in response to a request for information made for official purposes.16 A numbers of anomalies were noted on the division’s purchase as follows.
Tenders or Expression of interest are not advertised openly.

 Tender box kept in an open room accessible to all personnel.

 Keys for the tender box kept in one of the drawer in the Lautoka Accounts section.
14 Supplies and Service Instruction 48(2) 15 Supplies and Service Instruction 51(2) 16 Public Service Act- 1999, Section 9 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appointment of members of evaluation team was made internally.
One of the procedures used by the storeman at the Lautoka Water Supply whilst obtaining quotations from companies was to have these companies stamp as evidence that the quotations have been obtained, however there were instances where the storeman at the Lautoka Water Supply would put the stamp for Altrade Auto Traders & Civil Supplies on the space allocated for All Parts Supplies.

Audit views such an act as manipulation of the tender process.
Audit noted that the tenders were awarded to the cheapest supplier; however there was a tendency for the storeman to go to the supplier to physically check if items were in stock to be supplied to the Water Department.

Audit views this process of physical verification by the storeman after the awarding of tenders to be lacking transparency and the risk of the storeman colluding with the supplier and resulting in the government paying extra could not be ruled out.
The Storeman is part of the tender evaluation committee.

In several instances the same storeman raised the requisition, distributed the request for quotation to tendering suppliers, member of the tendering evaluation committee and responsible for receipt of the delivered items.

Only one employee is responsible for a number of tasks and this can contribute to manipulation of the procurement process.
Such weaknesses in the tender process could be a catalyst to illegal activities and the possibility of collusion cannot be ruled out.

Recommendations • Management should ensure that procurement procedures are to be documented and adhered to.

• The duties of staff need to be segregated for better controls.
• Management should ensure that all companies submitting their tenders should explicitly state if they have the items in stock and that this should be considered during the tender process and the current practice of the storeman carrying out physical verification should cease immediately.

• Suppliers and Service Instructions 51 (2) should be adhered to at all times.
Department’s comments Procurement procedures have been documented and discussed by management and all chief clerks and store man so that they know their duties and control measures have also been emphasized.

Tender forms have also been modified so that companies can also indicate the availability of the item required in their stock.

The physical verification is necessary because most companies would quote for the sake of doing business even though they have nil in stock.
The situation is unacceptable from our point of view whereby LPOs have been issued but the selected supplier cannot supply within the specified timeframe; in some cases up the delay is up to six weeks resulting in the delay of our work.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 20.21 Items taken for personal use An employee must act with care and diligence in the course of employment in the Public Service.17 All officers responsible for public stores shall at all times exercise proper economy with regards to public stores in order to avoid the unprofitable use of public moneys.18 On 22/11/07, Divisional Engineer (DE), Taito Delana authorized and approved the following materials and items to be issued out of the Department’s stores for personal use.
Upon further discussion with department staffs, the items were being transported to Drasa Vitogo where a DE’s family’s funeral was being held.
The following items were issued from Lautoka and Rural Water Supply Stores: Date 22/11 Item Description Roofing Iron 2” 50mm Galvanized Pipes Qty 40 11 Deep Freezer - 30meter Extension Cord - Power Point (6x) Board - 4feet Complete Tubelight (with 10meter Cord) 23/11 6” Galvanished Pipes 2” Galvanized Pipes 1 1 1 4 16 1 Remarks Items were issued from Rural Water Supply stores.
Following discrepancies were noted: - There was no approval obtained for items to be issued out from the stores but a mere verbal approval by the DE for roofs and pipes to be issued & delivered to designated area.

- Scrutiny of tally card revealed that roofs & pipes issued from stores had not been updated.

Enquiry with the Supervisor of Rural Water Supply revealed that roofs & pipes were loaned to Lautoka stores & he was not aware where the items were being transported.
- He then further entered the items issued from stores in the tally and showed to the audit team.

- (5) Galvanized pipes & (40) Roofing Iron were issued out from Rural water supply stores & loaned to Lautoka stores.

Delivery receipt #: 171093 Date: 22/11/07.

Items issued out of the Lautoka stores, authorized by DE.

Discussion with the Storeman revealed that it was the instruction of the DE to issue the above item.
Delivery receipt #: 171093 Date: 22/11/07 These items were specifically purchased by the Lautoka stores for DE’s personal use.

Requesting Officer – Raj Kumar (Treatment Pump Section) Requisiton #: 37 (Treatment & Plant Section) Date: 22/11/07 Authorization: was given by the DE to requesting officer to purchase the items.

No delivery receipt was issued by the storeman indicating items were taken from stores.

- No approval was obtained for items to be issued for DE’s personal use.
- Items issued out were not reflected in the tally card.

With the exception of the deep freezer which was returned on 22/11/07 the other items have yet to be returned.

17 Public Service Act No.

8 of 1999.


18 Supplies and Service Instruction 10 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • • The Divisional Engineer Western should be surcharged for cost of materials taken for personal use.

Appropriate disciplinary action should be taken against the officer.
Department’s comments The items were taken on personal loan for the funeral and have all been returned to the stores.
Item Roofing Iron 50mm Galvanized Pipes Deep Freezer 30mtr extension cord Power board [6] 4’ complete tubelight with 10mtr cord 6” Galvanized Pipes 2” Galv Pipes Qty 40 11 1 1 1 4 16 1 Remarks All returned to the Rural Water Supply stores These items were returned to the Rural Water Supply Stores Returned to Lautoka Water Supply Stores The items were purchased for use by the Water Treatment Office and Pump Repair Section.

All items have been returned to the stores for use by the Treatment Office.
There were no 6” galvanized pipes taken on loan.
This item have been returned to Rural Water Supply Stores DIVISION ENGINEER NORTHERN 20.22 Engagement of Project Workers The Project worker shall be engaged for a specific project and served a letter of engagement by a Ministry/Department which shall include amongst other things his/her rate of pay, the project in which he/she is engaged, the hours, days and duration of the project.19 A total of 69 workers were employed as temporary officers at the Divisional Engineer Water and Sewerage Northern in excess of the 93 approved Government Wage Earners establishment.
The projects in which the officers were engaged and the durations of employment were not specified in their engagement letters.

These officers were recruited for 10 to 12 months and there was also no job description maintained for these officers.
Refer the following examples: Officer Ronil Ravikant Prasad Anjani Lata FNPF Number YI 033 YL 434 Patrick Jione Pagkale XL 778 Timoci Turaga WN 464 Appointment Date 15/02/07 31/12/07 08/03/07 31/12/07 08/02/07 31/12/07 08/02/07 Current Position Assistant Clerk – Section/Unit Personnel – Assistant Clerk Accounts – Labourer Operation & Maintenance – Labourer Operation & Maintenance 19 Conditions and Rules of Employment for Government Unestablished Employees – Section 1, 5(a) Ministry of Local Government Urban Development and Public Utilities Section 20: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Officer FNPF Number Kolinio Nuimatui Walu XY 233 Chinamma Goundar Shoran Lata Jonetani Masitabua Inoke Cakitaki Usaia Waqaniboro XV 819 WZ 768 QO 793 2532-643 XJ 531 Appointment Date 31/12/07 08/02/07 31/12/07 14/04/05 31/03/05 12/10/06 26/04/07 23/05/05 Current Position Section/Unit – Labourer Operation & Maintenance Assistant Clerk Typist B Labourer Labourer Labourer Water Supply Office Water Supply Workshop Savusavu Water Supply Savusavu Water Supply The conditions and rules of employment for government unestablished employees were not followed and it is apparent that the above officers were employed merely to use up available funds in the Division.
Recommendations • • • The conditions and rules of Employment for Government Unestablished Employees should be strictly followed.

A job description should be maintained for all posts and this should be given to all officers on appointment date.

Recruitment should be made within the approved establishment Division’s Comments Part of the response to this concern is included in Section 1.3.1.

For those of Temporary and Casual Workers, no engagement will commence pending availability of Capital Projects.
This is not only to avoid over expenditure but also for the reason of work justification.

As highlighted in 1.3.1, the excess of Capital and Planned Preventative Maintenance Projects meant more Temporary and Casual workers were employed.

This creates more work for Sections such as the Accounts, Personnel, Workshop, etc.

Those temporary and casual workers, who had the qualification and experience to carry out the extra work demand, were taken up into these various sections.
While doing these works, they were still paid from Projects.

This adjustment in work may have not been clearly reflected or captured in the Engagement Form.

As for those who have been interviewed and are held-against Nominal Roll Vacancies, their engagement and work responsibilities are along the lines as reflected in the vacancies they are held against with.
With the added objective of Institutional Reform and Capacity Building, held-against workers in the Nominal Roll together with those identified workers in the Temporary and Casuals, are rotated and exposed to other areas of work with the intention of multi-skilling and developing them in line with the expectation of the Reform Programme for the Water and Sewerage Department.
20.23 Excessive Overtime Hours Carried Forward For the purpose of good internal control, it is an acceptable practice that employees are encouraged to take time off for the hours they have accumulated by doing overtime work.

Employees were accumulating excessive overtime hours without taking time-off.

Examples are illustrated in the table below.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Name Date 11/11/2007 Josefa Cabe 07/11/2007 Moh'd Shah 31/10/2007 Shiu K Naidu 14/11/2007 Daya Nand 09/11/2007 Hari Chand 13/11/2007 Epi Turaga 02/11/2007 Anil Kumar 01/08/2007 Nemia Drauna 22/10/2007 Noa Tamani 09/11/2007 Deo Chand 14/11/2007 Rajend R 28/11/2007 Mitieli Sovita 06/11/2007 Navitalai Rauto 12/11/2007 Rakesh Chand 06/11/2007 Pramit Puran 01/11/2007 Maciu Nama 08/11/2007 Shiu Rama 14/11/2007 Pranesh 11/11/2007 Deepak 01/10/2007 Amania T Total FNPF Number EJ 880 FG 909 HA 192 HA 208 HH 271 KC 148 LW 134 LY 448 NB 372 DW 754 XL 186 XT 643 VS 249 TA 830 WX 196 QZ 882 QN 384 XY 241 WX 197 VK 789 Position Fitter Leading Hand Supervisor Water Works Caretaker Pump Attendant Storeman A Carpenter Assistant Electrician Chainman Fitter Mechanic Chainman B Carpenter Electrician Fitter Caretaker Mechanic Apprentice Chainman Mechanic Overtime Hours Outstanding Cost ($) The accounting of overtime records was handled by a temporary government wage earner and was not independently checked by a senior officer.
Lack of management control of overtime has led officers to accumulate excessive overtime hours which would increase government’s liability.

The absence of independent check of overtime records by a senior officer also increases the risk of officers making fraudulent claim of overtime hours.

Recommendations • • A civil servant should be responsible in handling overtime records which should be independently checked by a senior officer.
The Division should avoid accumulation of excessive overtime and officers should be encouraged to take time off.

Division’s Comments The response to this concern is a follow-up to the response of Section 1.3.2.

The loading on overtime were exersabated by the sudden additional Capital Project work loadings towards the end of the year together with additional demand from the Operations and Maintenance works.
As highlighted in Section 1.3.2, prior approval for overtime work to be first obtained from the Engineer and all overtime works are to be signed and endorsed first by the Supervisor and Engineer before entering into the Time-Off Register.

As agreed by workers and endorsed by the respective Unions, time-offs are being taken by all respective workers.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 20.24 Procurement Authority Any officer who authorises expenditure exceeding his/her procurement limits, including by splitting purchase orders, shall be liable for surcharge to repay the unauthorised amount.20 Some officers were authorising orders above their approved limits.
Refer below for examples: Date 11/10/06 14/11/06 30/11/06 13/02/06 20/02/06 27/03/07 LPO Number Amount 633353 633713 633901 634142 634150 634291 $ 5,475.60 34,932.00 44,790.00 13,012.40 5,664.20 41,913.96 Approved Limit $ 1000.00 1000.00 1000.00 5000.00 5000.00 5000.00 Authorised by A/SAO A/SAO A/SAO DWEN DWEN DWEN The above findings indicate that purchases were not strictly controlled and managed by the department which could lead to excessive purchases.
Recommendation Surcharge action should be taken against officers authorising local purchase orders above their approved limits.

Division’s Comments All the items purchased from the above list given were from one Company, Ria Tan which is an Approved Tender for the Supply of mPVC and uPVC Pipes.
It should noted that in previous years, it has been the practice that for all Approved Tender the processing of LPO and payment was done in the Division on the strength that the Tender has been approved through the required process.

It was not until after the above period that Management was informed by an Audit Team member that while the Tender has been approved, the limit for the raising of the LPO will still be adhered to.
In the above case the approval from the Ministry of Finance should have been sought.

Since the above dates and for other related and similar cases, we are now complying or forwarding it to the respective authorities in regards to limits approval process.
20.25 Private Hire of Vehicles In case of hire of plants or vehicles, upon receipt of plant requisition form, job instruction sheet is issued on daily basis for hire of plants or vehicles either from plant pool or from contractors.21 Requisition forms and local purchase orders were issued after plant and vehicles have been hired.
Examples are shown in the table below: 20 Finance Manual 2.2.3 21 Ministry of Works and Energy Finance Manual 2.5.1 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Date 16/11/06 LPO No.
633675 23/11/06 633851 30/11/06 633865 30/11/06 633866 30/11/06 633867 30/11/06 633868 30/11/06 633869 05/12/06 05/12/06 633951 633952 05/12/06 683953 05/12/06 07/05/07 683957 634401 07/05/07 634402 07/05/07 634403 07/05/07 634404 07/05/07 634405 28/06/07 634410 16/05/07 634406 16/05/07 634407 16/05/07 634408 05/06/07 634409 28/06/07 634411 18/10/07 786159 18/10/07 786160 22/10/07 786179 22/10/07 786180 Particulars Hire of twin cab DU711 from 6/10/06 – 20/10/06 for operation and maintenance at Savusavu Water Supply.
Hire of twin cab 4X4 DK100 from 04/11/06 – 05/11/06 for transporting workmen & materials for Taveuni Water Supply.

Hire of twin cab DU711 from 30/10/06 – 03/11/06 for transporting workmen at Savusavu Water Supply.

Hire of twin cab DU711 from 06/11/06 – 03/11/06 for transporting workmen at Savusavu Water Supply.

Hire of twin cab DU711 from 13/11/06 – 17/11/06 for transporting workmen at Savusavu Water Supply.
Hire of twin cab 4X4 DK100 from 13/11/06 – 17/11/06 for operations and maintenance for Taveuni Water Supply.

Hire of twin cab 4X4 DK100 from 06/11/06 – 10/11/06 for operations and maintenance for Taveuni Water Supply.

Hire of twin cab EM450 from 27/11/06 – 01/12/06 for Water Foreman.

Hire of twin cab DK498 from 27/11/06 – 01/12/06 for Leak Detection Unit – Babasiga Hire Services.

Hire of twin cab DO230 from 27/11/06 – 01/12/06 for use by Hydrology.
Payee Marimuttu & Sons Ltd Marimuttu & Sons Ltd Marimuttu & Sons Ltd Marimuttu & Sons Ltd Marimuttu & Sons Ltd Marimuttu & Sons Ltd Marimuttu & Sons Ltd Babasiga Hire Babasiga Hire Lasea Civil Engineer Sakim Digging Babasiga Hire Hire of twin cab EK549 from 27/11/06 – 01/12/06 for Water Supervisor.

Hire of medium Excavator DE083 from 13/04/07 – 19/04/07 for works at Uluibau District School reservoir.

Hire of Excavator EG366 from 19/01/07 – 26/04/07 for the construction of Naidi Sewerage road.
Hire of Excavator DN361 from 23/04/07 – 26/04/07 for the construction of Nadi Sewerage road.

Hire of Dumper Truck EG454 from 23/04/07 – 26/04/07 for the construction of Nadi Sewerage road.

Hire of Dumper Truck EA360 from 23/04/07 – 26/04/07 for the construction of Nadi Sewerage road.

Hire of Truck CJ750 on 14/04/07 for the cartage of Bulldozer to Savusavu.
Babasiga Hire Lomanitoba Company Lomanitoba Company Lomanitoba Company Lomanitoba Company Hire of twin cab EM450 from 07/05/07 – 11/05/07 for transporting workmen for Taveuni Water Supply.

Hire of twin cab EM450 from 14/05/07 – 18/05/07 for transporting workmen for Taveuni Water Supply.

Hire of medium Excavator DE083 from 14/05/07 – 18/05/07 for road forming and culvert works for storm damage, Nasealevu, Navau.
Hire of medium Excavator DE083 from 21/05/07 – 25/05/07 for road forming and culvert works for storm damage, Nasealevu, Navau.

Hire of large Excavator DN361 from 21/06/07 – 23/06/07 for constructing Savusavu Access road to STP worksite, Naidi.

Hire of large Excavator DN361 from 11/10/07 – 12/10/07 for Mispha Avenue project and Narayan Height Valley.

Hire of large Excavator DN361 from 15/10/07 – 19/10/07 for Mispha Avenue project and Narayan Height Valley.
Hire of Truck Dumper DL987 from 18/10/07 – 19/10/07 for Mispha Avenue project and Narayan Height Valley.

Hire of Truck Dumper DL987 from 22/10/07 – 26/10/07 for Mispha Avenue project and Narayan Height Valley.
Service Babasiga Hire Service Babasiga Hire Service Babasiga Hire Service Babasiga Hire Service Lomanitoba Company Lomanitoba Company Lomanitoba Company Lomanitoba Company Lomanitoba Company Amount ($) 672.25 126.00 891.25 903.75 882.50 806.75 632.75 600.00 600.00 600.00 1,000.00 418.50 2,046.00 1,221.00 778.25 3,000.00 732.60 500.00 500.00 700.00 738.00 478.50 600.00 1,500.00 600.00 1,500.00 Proper procedures in the hire of plant and vehicles were not followed as local purchase orders were issued after the services have been rendered.
This was merely to facilitate payments and there is a risk that suppliers could falsify their claims because jobs were not specified (as LPOs were not issued).

Ministry of Local Government Urban Development and Public Utilities Section 20: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation Local Purchase Orders and request forms should be issued prior to the hire of plant or vehicle and any deviation from any officer should be disciplined accordingly.
Division’s Comments All Local Purchase Orders and Plant Requisitions are prepared and issued from our main Labasa Office.

For vehicles and Plants used by other Sections in Labasa, the Plant Requisition and Local Purchase Orders are issued in advance.

As can be seen from the above listing, most of the Plants and Vehicles listed above are from the Outer Stations of Savusavu and Taveuni.
Due to the distance involved there were some delay in the coordination and preparation of the Plant requisition and LPOs between our Labasa Office and that of our Outer Stations.
As Project funding had arrived late and Projects had to be completed before the Christmas break-off, together with prevailing good weather; these are some of the factors which may have contributed to the coordination of vehicle and plant usage at site together with that of the preparation of Plant Requisition and LPOs at the Labasa Office.
Our Outer Stations Project Supervisors have now been advised that no vehicle and plant usage to proceed until the Plant Requisition and LPO are prepared and raised from the Labasa Office.

All private Plants and Vehicles used for the Water and Sewerage are under the Government Approved Tender.
20.26 Item not taken on charge All goods received in an undamaged condition and which are in no respect defective shall be taken on charge in a stock register.22 The closing balance of certain items after the board of survey in December 2006 did not reconcile with the 2007 opening balance.

Refer to the following for examples: Board of Survey Date Item Details Board of Survey Balance Opening Balance 2007 Variance 16/01/07 16/01/07 16/01/07 23/01/07 25/01/07 25/01/07 ?

?
?

20mm Galvanised Socket 1/2″ Galvanised Socket Shower Rose 1/2″ 3″ PVC Saddle Clip 3/4″ Galvanised Union 6″ PVC Pipe 4″ PVC Pipe 90 70 18 18 553 164 320 0 30 0 3 474 145 0 Total 90 40 18 15 79 19 320 Unit Cost $ 2.65 1.85 6.95 78.00 2.65 174.66 89.58 Total $ 238.50 74.00 125.10 1,170.00 209.35 3,318.54 28,665.60 33,801.09 The huge variance noted above demonstrates the lack of control over stores by the storeman especially when dealing with expensive items.
This could lead to theft of government stores without being detected.

Recommendations • An investigation should be conducted on the unaccounted stores.

22 Supplies and Services Instruction 44(1) Ministry of Local Government Urban Development and Public Utilities Section 20: Page 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • • Disciplinary and surcharge actions should be taken against the officers responsible, for any loss of stores.
Tally cards should be updated regularly.

Division’s Comments In response to the above, the following are submitted: For the 320 lengths of 100mm diam.

PVC pipes as highlighted above, the pipes is for the Rural Self Help Capital Works Projects.

The Rural Water Supply Section has a separate Store by itself together with its Storeman.

During the event of Audit Inspection, the 320 lengths of 100mm PVC pipes were not reconciled with its corresponding cards in the Rural Stores.
For the 19 lengths of 150mm PVC pipes shortfall, this has been used for maintenance works as confirmed by the pieces of pipes returned after maintenance work.

Other inconsistencies on above items could have resulted as most of our original Stores Card are still with FICAC and have not been returned.

Items entries were done on Temporary Cards.


After the Audit inspection, there were certain changes made in the Stores: Items issued daily is to be posted daily into the Individual Stock Cards Stock Cards are tallied and matched with the Physical Stock weekly and any variance is noted and informed to the Storeman.

There is a Register of returned items by the workers who make sure the items returned to the Stores are accounted for.
Routine checks are done in the Stores by the Senior Officers to monitor the postings and balance of the stock and at times physical stock is matched with the stock cards.
Ministry of Local Government Urban Development and Public Utilities Section 20: Page 27 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 20.1 – Statement of Output Costs Policy & Administration-General Administration Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Costs Capital Construction Capital Grants & Transfers Total Capital Costs 2007 $ 2006 $ 457,392 46,429 45,594 62,393 15,072 0 0 626,880 778,111 86,499 69,027 75,450 10,617 903,122 0 1,922,825 0 0 0 1,345,312 1,625,000 2,970,312 Value Added Tax 82,565 190,396 TOTAL EXPENDITURE 709,445 5,083,533 Policy and Administration - Local Government Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Costs Capital Construction Capital Grants & Transfers Total Capital Costs Value Added Tax 2007 $ 2006 $ 103,415 11,586 3,046 1,149 5,975 1,604,800 0 1,729,971 111,100 8,444 5,208 1,900 13,720 1,600,000 4,030 1,744,402 0 496,195 496,195 16,462 20,000 36,462 14,828 13,551 TOTAL EXPENDITURE 2,240,994 1,794,416 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 28 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS –
 OCTOBER 2008 Town & Country Planning Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Costs Capital Construction Capital Grants & Transfers Total Capital Costs 2007 $ 2006 $ 432,923 20,411 25,839 39,828 6,420 0 0 525,421 0 41,867 41,867 476,902 22,000 25,761 29,436 2,368 0 0 556,467 0 0 0 Value Added Tax 67,790 46,346 TOTAL
 EXPENDITURE 635,078 602,813 Provision of Water Supplies-Policy & Administration Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Costs Capital Construction Capital Grants & Transfers Total Capital Costs 2007 $ 2006 $ 1,946,540 566,375 11,678 4,019 3,783 0 43,552 2,575,947 111,100 8,444 5,208 1,900 13,720 1,600,000 4,030 1,744,402 2,430 0 2,430 16,462 20,000 36,462 Value Added Tax 328,292 13,551 TOTAL EXPENDITURE 2,906,669 1,794,416 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 29 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Urban & Regional Supplies Description EXPENDITURE Operating Costs Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Total Operating Costs Capital Costs Capital Construction Total Capital Costs Value Added Tax 2007 $ 2006 $ 0 0 344 0 344 474 0 11,141 23 11,638 19,643,367 19,643,367 29,603,827 29,603,827 2,174,427 3,535,670 TOTAL EXPENDITURE 21,818,138 33,151,135 Rural & Settlement Supplies Description EXPENDITURE Operating Costs Established Staffs Unestablished Staff Travel & Communication Maintenance & Operations Total Operating Costs Capital Costs Capital Construction Total Capital Costs Value Added Tax 2007 $ 2006 $ 38,263 81 0 171 38,515
 25,815 173 0 1,161 27,149 1,504,485 1,504,485 3,833,926 3,833,926 223,960 459,438 TOTAL EXPENDITURE 1,766,960 4,320,514 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 30 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Maintenance & Operation Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Special Expenditures Total Operating Costs
 Capital Costs Capital Construction Total Capital Costs Value Added Tax 2007 $ 2006 $ 933,464 5,451,004 10,807 20,706,207 1,647 427 27,103,556 882,657 7,331,694 195,274 24,701,447 20,167 99 33,131,339 204,901 204,901 33,490 33,490 3,226,292 3,960,109 TOTAL EXPENDITURE 30,534,749 37,124,938 Water Resources Investigation Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Special Expenditures Total Operating Costs Capital Costs Capital Construction Total Capital Costs Value Added Tax 2007 $ 2006 $ 152,851 417,818 5,396 39,553 4,517 57,288 677,423 212,764 455,194 6,073 55,487 6,431 40,657 776,606 249 249 53 53 72,638 81,405 TOTAL EXPENDITURE 750,310 858,063 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 31 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Sewerage Services-Policy & Administration Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Total Operating Costs 2007 $ 2006 $ 236,894 0 536 6,959 5,499 249,888 261,167 5,866 6,617 291 8,424 282,365 Value Added Tax 29,462 53,559 TOTAL EXPENDITURE 279,350 335,924 Development of Urban Services Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Maintenance & Operations Purchase of Goods & Services Special Expenditures Total
 Operating Costs Capital Costs Capital Construction Total Capital Costs Value Added Tax 2007 $ 2006 $ 1,002 0 1,060 0 909 2,971 867 145 4,078 504 89 5,683 8,174,982 8,174,982 9,773,639 9,773,639 954,396 1,317,145 TOTAL EXPENDITURE 9,132,349 11,096,468 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 32 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Maintenance of Urban Systems Description EXPENDITURE Operating Costs Established Staff
 Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Special Expenditures Total Operating Costs Capital Costs Capital Construction Total Capital Costs Value Added Tax 2007 $ 2006 $ 67,101 1,043,851 1,225 4,410,953 43,904 632 5,567,666 61,787 1,359,142 14,045 4,443,251 59,902 0 5,938,127 12,950 12,950 67,742 67,742 767,163 727,076 TOTAL EXPENDITURE 6,347,779 6,732,945 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 33 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 20.2 – Items Purchased Without Local Purchase Orders Table 20.20 Viti Civil Engineering Supplies Date Delivery # Item Quantity 23/05/06 26/05/06 13/06/06 21/06/06 21/06/06 21/06/06 22/06/06 26/06/06 26/06/06 21/07/06 13/09/06 13/09/06 14/09/06 15/09/06 15/09/06 20/09/06 20/09/06 20/09/06 20/09/06 21/09/06 05/10/06 06/10/06 06/10/06 06/10/06 06/10/06 06/10/06 07/10/06 07/10/06 10/10/06 10/10/06 10/10/06 16/10/06 16/10/06 17/10/06 17/10/06 23/10/06 14/11/06 14/11/06 14/11/06 16/11/06 16/11/ ¾ Ferrule Cock HYD Globe 6’’ Super Coupling ½” Pushlock ¾” Pushlock ¾” Pushlock ¾” Pushlock ¾” Pushlock ¾” Pushlock ¾” Pushlock ½” Pushlock ¾” Pushlock ¾” Pushlock ¾” Pushlock ½” Pushlock ¾”
 Pushlock ¾” Pushlock ½” Pushlock ¾” Pushlock Detectable Tape (Coils) 50mm Gate Valve 50mm Gate Valve 3x3 sp-sp-FL Tee 3” Sluice Valve 6-As Joiner 6”S/Steel R/Clamp 300mm Gibault Joint 200mm Gibault Joint ½” Pushlock ¾” Pushlock 1” Pushlock ½” Stopcock 500mm MaxiFit Joint 3” Saddle Gun ¾” Ferrule Cock 8” Ferrule Cock 3” U/Ground Fire Hydrant 8” Repair Clamp S/Steel 6” Repair Clamp S/Steel 2” Saddle Gun ¾” Ferrule Cock Total 100
150 30 30 150 150 2 30 20 1 1 2 1 2 3 180 150 100 50 502 1 64 1 1 2 1 1 1 Cost ($) Ministry of Local Government Urban Development and Public Utilities Section 20: Page 34 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Pacific Safety & Industrial Supplies Date Delivery # Item Quantity 22/06/06 05/09/06 05/09/06 05/09/06 03/10/06 21/11/06 720 803 757 818 818 835 2” Non Return Valve 6.5mmx1.2mx10m Rub Insertion 2” Sluice Valve 3” All Flanged Tee 3” Sluice Valve 3” Super Coupling Total 1 1 1 1 1 1 Pacific Pipelines & Road care Ltd Date Delivery # Item Quantity 07/09/06 11/09/06 09/08/06 09/08/06 19/09/06 19/09/06 19/09/06 1299 1299 1301 1301 1322 1322 1322 ¾” Brass Ferrule Cock ¾” Brass Ferrule Cock 6’’ Super Coupling ½” Pushlock ¾” Pushlock ¾” Pushlock ¾” Pushlock Total 24 43 185 155 2 4 2 Table 20.23 Atrax Civil Supplies Date Delivery # Item Quantity 05/09/06 18/09/06 18/09/06 27/09/06 17/10/06 3396 3380 3380 3389 3407 ½” Brass Ferrule Cock Safety Vest Helmet 1” Pushlock Straight 3” PVC Saddle Gun Total 121 36 36 137 15 Table 20.24 Innovative Marketing Limited Date Delivery # Item Quantity 04/05/06 26/05/06 26/05/06 26/05/06 26/05/06 12/07/06 28/07/06 05/10/06
 06/10/06 12/10/06 28/11/06 09/12/06 481 545 545 545 545 332 515 557 242 567 371 380 ¾” Stop Cock 3” Sluice Valve 3” Flange Anger Socket 3” PVC-PVC Joiner M 16X65 Bolt & Nut 4” PVC AC GJ 2” PVC-PVC Jointer 3” PVC Saddle Gun 4 x 3 SP-SP FL Tee 1” Pushlock 4” S/Valve Fire Hydrant Cover Total 81 1 1 1 8 22 41 25 1 137 2 1 Cost ($) 660.00 2,340.00 495.00 585.00 660.00 175.00 4,915.00 Cost ($) 924.00 1,655.50 2,201.50 2,162.25 1,390.00 790.00 1,500.00 10,623.25 Cost ($) 1,996.50 2,340.00 1,008.00 1,986.50
 1,875.00 9,206.00 Cost ($) 2,389.50 660.00 175.00 70.00 36.00 1,980.00 1,968.00 1,987.50 595.00 1,986.50 1,540.00 385.00 13,772.50 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 35 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Mataisau Engineering & Civil Supplies Date Delivery # Item Quantity 17/03/06 28/03/06 04/04/06 04/04/06 13/04/06 24/04/06 27/04/06 11/05/06 12/05/06 24/05/06 06/06/06 15/06/06 28/06/06 04/07/06 10/07/06 10/07/06 17/10/06 261 701 702 702 703 704 707 708 709 713 714 717 718 330 501 502 517 610mm Joiner 1” Pushlock 2” Strainer 3” Strainer ½” Bibcock 2” Gate Valve (Peglers) Underground Fire Hydrant 2” Ball Valve Safety Shoes Rasp File PVC Saddle Gun 6” AS – Joiner 2” Sluice Valve 100mm Stepdown Joiner 4” Stepdown 4” Stepdown Underground Fire Hydrant Total 2 137 3 2 121 18 3 3 48 pairs 76 41 10 4 2 7 1 1 Cost ($) 5,770.00 1,986.50 1,980.00 1,370.00 1,996.50 1,980.00 1,980.00 1,575.00 5,380.80 1,976.00 1,988.50 1,980.00 1,980.00 180.00 630.00 90.00 660.00 33,503.30 Ministry of Local Government Urban Development and Public Utilities Section 20: Page 36 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 21 Department of Women, Social Welfare and Housing Programme Statement The operations of the Department are divided into Social Welfare, Women and Poverty Eradication Unit.
The functions of the Department of Social Welfare are broadly categorized into statutory and non-statutory responsibilities.

The statutory obligations relate to childcare including fostering, adaptations and residential care.

The non-statutory responsibilities family welfare and rehabilitation.

The main activities of the Department include Policy and Administration, Institutional Services and Field Services.
The Departments core business functions are children and family community economic development and social policy advice.

include matrimonial counseling, general The Department of Women’s primary accountabilities includes Mainstreaming Women and Gender Concerns, Women and the Law, Elimination of Violence against Women and Children, Women and Micro-Enterprise Development and Balancing Gender in Decision Making.
The Poverty Eradication Unit is responsible for ensuring that government’s poverty alleviation projects and programmes are well co-ordinate and implemented in an integral manner.
Table of Contents 21.1 21.2 21.3 21.4 21.5 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion ............................................................................................................ 2 Statement of Receipts and Expenditures.................................................................. 2 Statement of Output Costs ....................................................................................... 3 Appropriation Statement ........................................................................................... 3 Statement of Losses ................................................................................................. 4 AUDIT FINDINGS ................................................................................................................................. 4 Appointment of Project Officers ................................................................................ 4 New Appointment not Advertised.............................................................................. 5 Missing PAP Funds .................................................................................................. 7 Double Payment of PAP Funds ................................................................................ 9 Failure of Income Generating Projects.................................................................... 11 Awarding of PAP Funds without Proper
 Procedures............................................... 12 Recipients with Same Bank Account ...................................................................... 13 Real and Bogus Name with Same Bank Account Number...................................... 15 Recipients receiving assistance through Voucher Book and Bank Mode................ 16 Increase in allowance without SWO’s Approval ...................................................... 17 Recipients Uplifting Two Voucher Books ................................................................ 17 Review of Family Assistance Recipients................................................................. 19 Revenue Variances ................................................................................................ 20 Drawings Account Reconciliation............................................................................ 20 Operating Trust Fund Account................................................................................ 21 Losses Report ........................................................................................................ 21 21.6 21.7 21.8 21.9 21.10 21.11 21.12 21.13 21.14 21.15 21.16 21.17 21.18 21.19 21.20 21.21 Department of Women, Social Welfare and Housing Section 21: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 21.1: Statement of Output Costs............................................................................ 22 Appendix
22 Appendix 21.2: Real and Bogus Name with Same Bank Account Number ............................ 25 FINANCIAL STATEMENT 21.1 Audit Opinion The audit of the 2007 accounts of the Department of Women, Social Welfare and Housing resulted in the issue of a qualified audit report.
The qualifications are as follows.

a) The Department of Women and Social Welfare has consolidated its expenditures into six Statements of Output Costs, whereas the Budget Estimates 2007 prescribes ten outputs.

b) The Department failed to submit the following contrary to section 82(1): (i).

a Statement of Losses; and (ii).

a Trust Account Statement of Receipts and Payments.

The Financial Information System shows a balance of $34,031 in the Department’s accounts as at 31 December 2007.
21.2 Statement of Receipts and Expenditures The Department incurred a total expenditure of $26,568,648 in 2007 compared to $24,317,122 in 2006.

Details are provided in Table 21.1.
Table 21.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Operating Revenue Total State Revenue Agency Revenue Miscellaneous Revenue Total Agency Revenue 2007 $ 2006 $ 183,960 183,960 11,991 11,991 3,097 3,097 --- --- TOTAL REVENUE 187,057 11,991 EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services 2,981,579 409,671 156,036 214,356 166,924 3,279,617 497,005 137,429 185,781 115,817 Department of Women, Social Welfare and Housing Section 21: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 19,470,568 37,873 23,437,007 2006 $ 15,380,188 140,905 19,736,742 330,647 --- 2,443,859 2,774,506 8,700 112,618 4,059,112 4,180,430 Value Added Tax 357,135 399,949 TOTAL EXPENDITURES 26,568,648 24,317,121 21.3 Statement of Output Costs The Statement of Output Costs did not consolidate expenditures into the ten outputs prescribed in the Budget Estimates as required.
These are detailed in Appendix 21.1.

21.4 Appropriation Statement The Department incurred expenditures totalling $26,568,648 in 2007 against the budget of $29,281,900 resulting in a savings of $2,713,252 or 9%.

Details are provided in Table 21.2.
Table 21.2: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants and Transfers Total Capital Expenditure 13 Value Added Tax Budget Estimate $ 2,984,400 445,100 168,400 224,500 186,100 19,495,000 91,000 23,594,500 1,000,000 0 4,050,000 5,050,000 637,400 TOTAL EXPENDITURE 29,281,900 Changes $ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Revised Estimate $ 2,984,400 445,100 168,400 224,500 186,100 19,495,000 91,000 23,594,500 Actual Expenditure $ 2,981,579 409,671 156,036 214,356 166,924 19,470,568 37,873 23,437,007 Carry – Over $ 0 0 0 0 0 0 0 0 Lapsed Appropriation $ 2,821 35,429 12,364 10,144 19,176 24,432 53,127 157,493 1,000,000 - 4,050,000 5,050,000 330,647 0 2,443,859 2,774,506 637,400 357,135 29,281,900 26,568,648 0 0 0 0 0 0 669,353 - 1,606,141 2,275,494 280,265 2,713,252 Department of Women, Social Welfare and Housing Section 21: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 21.5 Statement of Losses The Department of Women, Social Welfare and Housing failed to submit a Statement of Losses for the financial year ended 31/12/07 AUDIT FINDINGS 21.6 Appointment of Project Officers Vacant posts will normally be advertised in the Fiji Pubic Services Official circular and the press if considered appropriate.
When an officer applies for any vacancy, whether advertised or not, he/she should send his/ her application through his/her Permanent Secretary of Head of Department.1 A Project worker shall be engaged for a specific project and served a letter of engagement by a Ministry/Department which shall include amongst other things his/her rate of pay, the project in which he/she is engaged, the hours, days and duration of the project.
The letter of engagement should specifically state that the engagement is only for the duration of the project to which he/she is engaged.
If the project worker is subsequently engaged in another project, he/she should be issued with another letter of engagement specifying the commencement of his/her engagement in that particular project and that it shall continue until the project is completed or earlier subject to management discretion.2 The following two project positions were filled without being advertised and neither officer applied.

• Mr. John Sowani (FNPF # GF 867) was appointed as Project Officer in the Poverty Eradication Unit.
Mr Sowani was offered a temporary appointment for six months with effect from 11/04/05 on salary scale of $23,854.

• Mr. Fred Elbourne (FNPF – LP152) was appointed to the position of Project Communication Officer - Poverty.

The appointment was for a period of six months with effect from 20/05/05 on a salary of $23,854.

The officers are still being employed by the department although their six months engagement period has expired.
Currently Mr. John Sowani is held against the vacant position of Principal Economic Planning Officer while Mr. Fred Elbourne is held against the post of Senior Women’s Interest Assistant.

An open and competitive selection process was not followed in the appointments of the two officers.

Recommendations • • • The Ministry should ensure that proper procedures are followed in the appointment of Project Officers.

The projects officers should only be employed for the duration of the projects.
The positions should be advertised and filled transparently.

1 General Orders 205 2 Conditions and Rules of Employment for Government Unestablished Employees 5 (a) Department of Women, Social Welfare and Housing Section 21: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Departments Comments These officers were initially appointed as project officers for six months.
At the expiry of the initial six-month term they were appointed as temporary officers against vacant posts that were existing in the Ministry at the time.

The 2 officers have since had their temporary appointments continuously extended following completion of outputs.

21.7 New Appointment not Advertised Vacant posts will normally be advertised in the Fiji Pubic Services Official circular and the press if considered appropriate.
When an officer applies for any vacancy, whether advertised or not, he/she should send his/ her application through his/her Permanent Secretary of Head of Department.3 Employment decisions in the public services are made without favouritism or political influence, an appointment and promotions are made on the basis of merit after an open and, competitive selection process.4 Audit noted that the recruitment of temporary relieving officers was neither advertised nor the candidates had applied for the positions.
Refer to Table 21.3 for examples.
Table 21.3: New Appointment not advertised Officer Kilioni Tuitubou Premila Kumari Seini L Tabaka Jiurie Marseu Hary Filimoni Narube Valerio Vilika FNPF Number LA 994 WN 070 YA 481 2540848 2530258 NE 956 Appointed Post Date Joined 21/12/05 Welfare Officer 10/08/05 Welfare Officer II 02/03/05 Review Assistant 12/11/07 Women Interest Assistant 19/06/06 Review Assistant 21/12/05 Senior Women Interest Assistant Current Post Welfare Officer II Welfare Officer II Welfare Officer II Women Interest Assistant Welfare Officer II Senior Women Interest Assistant An open and competitive selection process was not complied with in accordance with Public Service Regulations.
The officers’ appointments were not based on merit and these clearly showed that favouritism existed in the recruitment and selection process by those in authority.

Recommendations • • The Department should ensure that all newly created positions are advertised in accordance with Public Services Regulations.

Disciplinary action should be taken against the officer(s) authorizing such new appointment.
Departments Comments One set of vacant posts had been advertised and the Department was awaiting the certificate of availability of funds from the Ministry of Finance to enable PSC to advertise the remaining posts.

The need for additional staff on the ground was urgent.

Individuals who had undergone the complete process of short listing and interview for the advertised posts were appointed according to the order they appeared in the ratings list.
These were officers who were second best in the interview and were then appointed against the vacant posts as temporary welfare officers.

3 General Orders 205 4 Part 2, section 4(4) – Public services Act 1999 Department of Women, Social Welfare and Housing Section 21: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Department is now ensuring that all appointments are carried out in line with normal recruitment procedures as laid down under PSC regulation.
Duration of Care Order If it appears to a juvenile court, on the application of the Director, that by reason of the mental condition or behaviours of a juvenile who is subject to a care order it is in his interest or the public interest that the care order should remain in force after he has attained the age of 17 years, the court may order that the care order shall continue in force until he attains the age of 18.5 The recipients of Care and Protection Allowance are continuing to receive the allowance at the rate of $60 per child per month although the child under their care had attained the age of 17 years.
There was no court order seen during audit for the continuation of allowance.

Refer to Table 21.4 for examples.
Table 21.4: Recipients continue to receive assistance after turning 17 Recipient Ref # Childs Name Date of Birth Timoci Vuadrau Timoci Vuadrau Asesela Naboro Matorina Kauyaco Louisa Dololatibua Louisa Dololatibua Louisa Dololatibua Shiu Rangi Shiu Rangi Shiu Rangi Litea Veturu Jowalesi Caginitoba Jowalesi Caginitoba Arieta Vaganalau SU/CH/926/95 SU/CH/926/95 SU/SB/133/01 NV/AT/CW/05/02 SU/HR/81/96 SU/HR/81/96 SU/HR/81/96 SU/SN/520/91 SU/SN/520/91 SU/SN/520/91 SU/IP/555/94 SU/SB/70/00 SU/SB/70/00 CP 205/01 Timoci Radrodro Varanisese Kenona Amelia Sulita Nikolo Kaganiu Vatemo Niurua Rosalio Yalomalua Makeveta Nawede Amit Kumar Raj Amrita Devi Raj Avnit Kumar Raj Litea Bianca Lepani Uluiviti Paula Ravuga Paula Wakamibua 16/07/89 03/05/91 24/05/89 05/09/89 01/08/87 02/12/82 16/05/89 25/04/81 08/06/85 09/05/89 22/08/89 12/02/89 12/02/89 30/12/89 Date at Age 17 Years 16/07/06 03/05/07 24/05/06 05/09/06 01/08/04 02/12/99 16/05/06 25/04/98 08/06/02 09/05/06 22/08/06 12/02/06 12/02/06 30/12/06 Welfare officer’s failed to review cases on a timely basis as a result the recipients continued to receive allowances although the child under their care had turned 17.
Recommendations • • • The welfare officers should carry out review of the cases on a timely basis.

Allowances of those children over 17 years should cease immediately.

Only those children having Court Order should continue to be assisted.
Departments Comments There is provision in the Juveniles’ Act Cap 56 section 50 [2] for extension of Care Order to when children are 18 years old but proof must be submitted to show that the children concerned are still attending formal education or that it is “in the best interest of the child” to remain in the institution for another year.

Under such circumstance the Director is legally obligated to ensure the safety, care and maintenance of the child.
Fiji has ratified the Convention of the Rights of the Child and the Convention states that 18 years is the legal limit of the age of a child.

5 Juveniles Act 1978 Section 50 (2) Department of Women, Social Welfare and Housing Section 21: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Reviews are an on-going process but the department has been hampered over the years with the lack of transport and staff to allow all reviews to be completed effectively.
2007 was a year that the Department had been under great stress due to its inability to advertise vacant posts.

The Department has identified that review will be one of its major outputs for 2008.

Reviews have begun but we are still being hampered by the lack of vehicles.

When the Department receives its 10 new vehicles, reviews will be timely and done on a more consistent basis.
21.8 Missing PAP Funds All money shall be kept in a safe or other secure place.6 All acquittal report must be signed by both the recipients and NGO and where relevant, bear the company seal or stamp of the organization.7 Poverty Eradication Unit (PEU) carried out a pilot scheme in 2005 for 26 Ex Prisoners whereby each Ex Prisoner was assisted with $3000 for Income Generating Projects.
The aim of the scheme was to help the Ex Prisoners set up small businesses as a mean of generating income for themselves and their families.

The following irregularities were noted • The cheques of $3,000 each were originally made out to “the order of” the payee but was changed to have “Pay Cash” stamped on the cheques when it was realized that most of the recipients did not have personal bank accounts.
• The project officer Mr. John Sowane had requested the Chief Executive Officer to approve that the cheques be stamped “paid” and the approval was given on 21/04/05.

• The cheques of $3000 were cashed by the Project officers and disbursed on “piece meal basis” to the recipients.

A formal contract was made between the Poverty Eradication Unit and the each recipient whereby the recipients were required to sign after receiving each payment.
• Total cost of the scheme was $78,000 out of which only $62,831 was disbursed.

The balance of $15,169 has not been accounted for.

Cheques belonging to two recipients namely Karalaini Lewani and Joji Cagilaba were collected by Mr. John Sowane however the contracts of the two recipients were not seen.

Therefore it cannot be established whether the two recipients had received their money.
• Progress reports or acquittals for the sum of $62,831 were not seen in the files which were produced for inspection to account for the funds disbursed.

It was therefore not possible to verify how that money was used and whether it was used for the approved purpose.

Refer to Table 21.5.
6 Finance Instruction 2005 Section 38 (1) 7 Finance Manual 2005 section 3.2.22 Department of Women, Social Welfare and Housing Section 21: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 21.5: Balance of grant money not distributed to recipients Name of Recipient Address Business Grant Amount Paid $ Canteen / Yagona 3000.00 1900.00 Balance $ 1100.00 Kemueli Baleimaiba Adriu Waqabaca Alivereti Naqiri Tomasi Ratukana Ulita Tadulala Mikaele Naqila Mereia Bau Naika Jioji Waqasaga Semiti Cagi Waisea Rarawa Mausio Susau Karalaini Lewani Joeli Cagilaba Nakauvadra Rt Dovi Rd Nadawa Nasinu 19 Cakacaka Rd Caubati Nasinu Keiyasi Navosa 22 Elbe Place Chandmani St Lautoka 66 Delainavesi Lami 10 Armstrong St Suva Lot Stage 82 Cunningham Rd Tacirua Village Tamavua Nadonumai Village Lami Malakua Settlement Nadi Block 22 flat 111 Reba Nadera Rd 1 USP Studies 3000.00 1900.00 1100.00 Farming Screen Printing 3000.00 3000.00 2635.00 1225.00 365.00 1775.00 Tailoring 3000.00 2975.00 25.00 Yagona wholesale Money Lender Canteen / Piggery Canteen / Yagona Canteen / Yagona Furniture Making 3000.00 3000.00 3000.00 3000.00 3000.00 3000.00 3000.00 3000.00 2000.00 2800.00 2450.00 2825.00 1496.00 1625.00 ?
?

?

?

1000.00 200.00 550.00 175.00 1504.00 1375.00 3000.00 3000.00 15,169.00 ?

?

?

?

?

?

?

?

Total The following recipients had received their first instalments before the cheques for the respective recipients were prepared.

This may indicate that the project officer was keeping undistributed cash of the other recipients which was paid the following recipients as their first installment.

Refer to Table 21.6.
Table 21.6: Recipients paid before the cheques were written Recipient Kemueli Baleimaiba Adriu Waqabaca Ulita Tadulala Mikaele Naqila Jioji Waqasaga Cheque Number Date Stamped “Paid” Date of 1St Installment 67170 67164 67169 66895 67171 11/05/05 11/05/05 11/05/05 21/04/05 11/05/05 24/04/05 22/04/05 22/04/05 19/04/05 22/04/05 This indicates that the Ex-Prisoners have not received their full assistance and that the project officers may have mismanaged the funds as a sum $15,169 has remained unaccounted.
Funds approved for the income generating projects were not effectively managed as cheques were not made in instalment for the exact amount needed by an ex-prisoner for each stage of his project.

Instead the total amount requested for the projects were cashed and managed by the project officers.

The system is open for misuse and abuse.


The department is in no position to establish whether projects were carried out since acquittal and progress reports of the projects were not prepared by the Project Officer.
Department of Women, Social Welfare and Housing Section 21: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations The Department should: • • • • carry out a detailed investigation on the manner in which PAP Fund is managed and establish the whereabouts of the undistributed cash amounting to $15,169; take appropriate disciplinary action against those found to be involved in mismanagement of public funds; review the existing system to ensure that all payments are controlled by the Accounts Section and project officers are not involved in disbursing funds to recipients; monitor closely and regularly review projects undertaken to ensure that projects are successful and would be able to sustain the future needs of recipients.
Departments Comments Irregularities have been identified: Cheques were made “Pay Cash” as these recipients did not have bank accounts.

The approval to pay cash was given by the CEO.

Recipients Karalaini Lewani and Joji Cagilaba, the original beneficiaries could not be located when the funds were approved and the team leader Mr. Paulo Ralulu replaced these two with Sitiveni Koli and Ilatia Mavoa.

As a result, audit was unable to sight their contracts.
John Sowani uplifted the cheques on the instructions of the CEO and the team leader.

Progress reports were compiled by both Messrs Ralulu & Sowani on the project and other deliverables on a monthly basis and forwarded to the CEO.

The five mentioned recipients were paid before their cheques were prepared from the monies kept in the office from the pool, as this was a group project.
We recognize that procedure was not followed in the keeping of funds in the office and disbursement in piece meal basis, but this was done to ensure that the funds were properly utilized, in view of the previous experiences with PAP funds disbursed to Ex Prisoners.

The authorizing authority for the alterations in payment and retention of funds is no longer with the Ministry but the PAP committee.
The unaccounted amount of $15, 169.00 was reported as missing to the Raiwaqa Police Station as explained by Mr. John Sowani .However this matter will be investigated further as recommended by the Audit.
21.9 Double Payment of PAP Funds Since the inception of the Poverty Alleviation Scheme, the program has been providing the following services to its target groups: • Housing • Income Generating Projects All acquittal report must be signed by both the recipients and NGO and where relevant, bear the company seal or stamp of the organization.8 8 Finance Manual 2005 section 3.2.22 Department of Women, Social Welfare and Housing Section 21: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Some recipients under the PAP scheme for housing were paid twice as their applications were approved in two separate PAP Committee meetings.
Refer to Table 21.7 for examples.
Table 21.7: Double payment of PAP Grant Recipient Name Reference Number Pita Taraicaka SU/IM/96/03 Sekove W RA/VU/34/05 PAP Meeting Date 22/08/06 01/06/06 Implementing NGO Dorcas Welfare Organisation Direct Payment to Recipient Amount Paid $ 5000.00 PAP Meeting Date 24/02/07 2000.00 29/12/06 Implementing NGO FCOSS Methodist Church Amount Paid $ 5000.00 5000.00 One Ilaitia Mavoa (SU/03) was assisted during the Ex – Prisoners Pilot scheme in 2005 where he received $3,000 for starting a sub – contracting business in the building industry.
The same Ilaitia Mavoa was again approved a sum of $3,000 for assistance to farm a land in the PAP committee meeting on 31/05/07 The NGOs responsible for implementing the projects approved in the respective 2006 meetings have also not submitted their acquittals.

Without any acquittals, the Department would not be in a position to establish whether funds released have been utilized for the purpose it was approved.
The above findings highlight the weakness in the system as such double payments were not detected.

Recommendations • • • The Department should ensure that all funds released are properly acquitted and acquittal report to be submitted by the NGO’s Officers responsible for approving the double payments should be disciplined.

Proper records should be kept so that double payments do not occur.
Departments Comments PAP Acquittals are usually signed by the NGO alone as existing Department PAP Practice and not the recipients as well.

This is so because the PAP contract is signed by the NGO alone when the cheques are disbursement.

It is agreed that cheques for a few recipients were made twice.

However when the anomalies were detected, corrective measures were taken to rectify these.
In a few cases the PAP Committee did wrongly approve applications twice but this does not necessarily mean that cheques were also made.

a) once, b) Pita Taraicaka – name was approved twice in the PAP Committee meeting but was paid only Sekove W – name was approved twice in the PAP committee meeting but was paid only once.

Some NGO’s are not very responsible in discharging their duties as per the contract.

However officers in the field monitor each approved project closely.
The Department will be streamlining policies and procedures in respect of the administration of PAP projects to minimize such anomalies and complaints.

Department of Women, Social Welfare and Housing Section 21: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 21.10 Failure of Income Generating Projects Individuals and families have been assisted with seed funds to help them set up small businesses as a mean of generating income for themselves and their families.
The aim is to increase the earning capabilities of individuals/families and wean them from the Family Assistance scheme.9 The following Family Assistance recipients were assisted to set up small business with an aim to wean them from the Family Assistance Scheme.

However projects were not implemented and as a result they have continued to be assisted from the Family Assistant scheme.

Refer to Table 21.8 for examples.
Table 21.8: Failure of income generating projects Recipient Ref Number Income Generating Project Date Paid Mariana Marama Timoci Ledua Waisea Nasili Ilaitia Masitabua SU/BS/186/02 SU/1305/02 SU/SK/74/03 SU/BS/430/03 Sewing Business Canteen Business Canteen Business Selling Fish 13/09/06 13/09/06 29/12/06 14/09/06 Amount Paid $ 3000.00 3000.00 3000.00 3000.00 The table below shows that the above recipients of Income Generating are now continuing to receive Family Assistance Allowance.
Table 21.9: Recipients Receiving FA allowance Recipient Ref Number Mariana Marama Timoci Ledua Waisea Nasili Ilaitia Masitabua 101-100549 101-103576 101-107204 ?

?

Amount Per Month $ 65.00 60.00 60.00 65.00 Physical inspection reports of the projects were not sighted in the respective files indicating that physical inspection and review of acquittal reports of the projects were not made by the Welfare Officers.
It is evident that the above projects were not successful and recipients continue to receive FA allowance after their income generating projects had failed.

Income generating project funds have been wasted and their objectives were not achieved.

Recommendations • • Recipients assisted through income generating projects should be closely monitored and reviewed to ensure that projects undertaken are successful and would be able to sustain future needs of the recipients.
The Department should ensure that all funds released are fully acquitted and acquittal reports are submitted within the specified time.

9 Cabinet Memorandum – Criteria for Poverty Alleviation Project dated 01/03/02 Department of Women, Social Welfare and Housing Section 21: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Departments Comments Income generating is given to Family Assistance recipients in an effort to wean them from the assistance programme.
Failure of projects was to be expected as recipients are from poor backgrounds with little or limited exposure to formal education.

The lack of process and assistance to those to be weaned off contributed to the inability of the recipients to survive on their already bare minimum income and the inefficiency of contracted NGO’s identified by the recipients themselves, to deliver required the required services.
Other major contributing factors were the constant shift of the delivery unit for PAP funds that occurred in that year, the moving of PAP to be directly under the office of the CEO, the absence of a Director of Social Welfare for the year 2006 and the continuing change that was being made at all stages of the process 21.11 Awarding of PAP Funds without Proper Procedures All applications together with all relevant supporting documents must be submitted to the PAP Secretariat by the Divisional Social Welfare Officer to be included in the PAP committee meeting.10 All applications must be accompanied with the following documentary evidence:11 Housing Projects • House Plan • Quotations • Carpenter/Labour agreement • Land consent document • Support letter from Community leader or church representative.
Income Generating Projects • Quotations • Feasibility Report • Support letter from community leaders or church representatives • Retails licences to operate • Health approval letter.

Some applications lodged in 2001 and 2002 were approved by the PAP Committee in 2007.

Documentary evidences were also filed as such audit was not able to establish the basis which led the PAP Committee to approve these applications.
Refer to Table 21.10 for examples Table 21.10: Awarding of PAP Funds without Proper Procedures Recipient Reference # Project Date Approved Amount $ NGO Taniela Meke Lalita Devi Morotikei Vocevoce Sairusi Catiau Josevata Natuituba Esala Dau Inia Raimoli Nacanieli Moce NU/VV/53/02 NU/MC/75/02 NU/VV/437/01 NU/SK/147/01 NU/VV/380/01 SU/CD/02 NU/MC/120/03 NU/TM/374/01 Housing Housing Housing Housing Housing Income Gen Income Gen Housing 25/02/07 25/02/07 25/02/07 25/02/07 25/02/07 25/02/07 25/02/07 25/02/07 5000.00 FCOSS 3500.00 FCOSS 5000.00 FCOSS 5000.00 FCOSS 5000.00 FCOSS 3000.00 FCOSS 3000.00 FCOSS 5000.00 FCOSS 10 Finance Manual 2005 section 3.3.9 11 Cabinet Memorandum – Criteria for Poverty Alleviation Project dated 01/03/02 Department of Women, Social Welfare and Housing Section 21: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recipient Reference # Project Date Approved Amount $ NGO Diamaru Niucakau SU/17/02 Housing 25/02/07 5000.00 FCOSS The time taken to approve the cases by the PAP Committee is relatively long.
It is probable when an applicant initially applies; he/she is in genuine need for such assistance.

However, at the time of approval, the applicant may not be a genuine case needing urgent assistance.

With the length of time taken to approve the cases, a recipient would be unlikely to be in the same financial situation when the application was made.

It is possible that some of the applicants may have improved their financial situation and do not need any assistance.
Recommendations • • The Department should have documentary procedures in place to ensure timely approval of application.

All the pending applications should be re-assessed to find out if the applicants are still in genuine need for assistance.

Departments Comments It is standard office practice that applications from the field are only forwarded to the Headquarters for consideration, when all the relevant documents are available.
Further the PAP Secretariat only submits to the Committee, those applications which are complete in all aspects with all the relevant documents.

This ensures that the PAP Committee has all the information available to them prior to making a decision.

Some applications already presented to the PAP committee once, are at times referred back to the field office for further information.
The field office will then meet with the applicant to obtain the required information and forward to the secretariat once available.

This does cause delays.

However it should be noted that the secretariat and the PAP office has moved from one office to the other on several occasions, due to reorganizations by the CEO.

This may have caused the missing relevant documents.

The movements may have caused the misplacement of some earlier applications which when found, were submitted to the PAP committee.
However this is not a regular occurrence.

It is true that at times the situation of recipients do change over a period of time.

The applicants of PAP are mostly recipients of Family Assistance.

For as long as an applicant is a recipient of family assistance, PAP assistance is valid.

The changes in circumstances of recipients are usually known to the Field Officers who return cheques in respect of those recipients who would no longer qualify or are deceased.
Backlog of cases is inevitable considering the high number of applications against the budgetary allocation for this purpose.

The Secretariat for the Committee is tasked with the purpose of ensuring all relevant documents are available to the Committee.

The only plausible explanation for this could be that documents may have fallen out of files already actioned when the Auditors did their review or it could be due to the continuous moving of files between Civic Towers and Suva Street offices.
The Auditor’s observations are noted and procedures will be put in place to ensure that proper accountability is established.
21.12 Recipients with Same Bank Account Cabinet approved that recipients of the Family Assistance Allowance should select the method of payment that is accessible and cost effective provided by postal services, ANZ Rural Banking and Colonial National Bank12 12 Interim Government Cabinet Paper (07) 26 Date 13/02/07 Department of Women, Social Welfare and Housing Section 21: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The audit of FA records revealed that in some cases recipients have the same bank account numbers despite different reference numbers.
In one instance one recipient had two bank accounts in different banks.

Refer to Table 21.11 for examples.
Table 21.11: Recipients Having Same Bank Account Comments The recipient (501-104426) has one account with CNB (6252453) and one account with ANZ (9247495) Reference Number 501-104334 501-105081 503-103197 501-104426 501-104426 403-105705 401-108004 201-106551 201-107059 Bank CNB CNB CNB CNB ANZ ANZ ANZ ANZ ANZ Account Number 6232367 6232367 Amount $ 60.00 60.00 6252453 6252453 9247495 9324685 9324685 8778039 8778039 60.00 60.00 60.00 60.00 60.00 60.00 60.00 This implies laxity by the Senior Welfare Officers in not properly checking the list prepared by the Divisional Clerks.
It is possible that there may be more such cases not identified as a result of a lack of detail checks.

Recommendations • • • • • The Department should review the current processing and payments procedures to avoid such overpayments.

The officers responsible for making such entries should be more vigilant.

Disciplinary action should be taken against responsible officers for not carrying out their duties with care.

All the double payment into the bank accounts should be recovered.
The list submitted by the Divisions should be properly checked at Headquarters before submitting to the respective banks.

Departments Comments This database was provided by divisional offices and it appears to be a typing error during the process.

(Need clarification on 501-104334, 501-105081, 503-103197, 501-104426, 403-105705, 401-108004, 201-106551, 201-107059).

Some of the recipients were overpaid but was detected and recovery was carried out.
Where recovery was not possible, recipients were not paid for that specified period.

The system is now centralized for further verification and closed monitoring at Headquarters before submitting to respective banks.

The Department of Social Welfare has been identified as priority and is currently working closely with ITC on improving its database through e-governance.
Department of Women, Social Welfare and Housing Section 21: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 21.13 Real and Bogus Name with Same Bank Account Number Each voucher should have the unique identifier of the client’s reference number prefixed with their Cost-Centre and suffixed with the month and year that the voucher is valid for.13 Cabinet approved that recipients of the FA Allowance should select the method of payment that is accessible and cost effective provided by postal services, ANZ Rural Banking and Colonial National Bank.14 There were some cases where a reference number would have a real and a bogus recipient.
The real and the bogus recipients are identified with the same reference number and the same bank account number.

Therefore the recipients receive double payment into the same bank account number.

One Arun Lata is receiving $75 via a bogus reference number 301-101967.

The same reference number belongs to a recipient name Shiu Shankar.

Examples of such irregular payments are shown in Appendix 21.2.
The above finding reflects the existence of weak controls in respect of assisting recipients through the banking mode.

In addition, the Senior Welfare Officers in districts were not scrutinizing the lists which were submitted to Headquarters.

Recommendations • • • • • The Department should review its procedure for processing payments effected by banking mode in order to avoid such overpayments.

The officers responsible for making such entries should be more vigilant.
Disciplinary action should be taken against responsible officers concerned for not carrying out their duties with care.

All the double payment into the bank accounts should be recovered.

The list submitted by the divisions should be properly checked at headquarters.

Departments Comments Arun Lata is a recipient at Labasa office with reference number 301- 103169.

Shiu Shankar was a recipient at the Labasa office with reference number 301-101967.
However this case was terminated on 29/08/06 and the file was transferred to the Sigatoka office.

The system is now centralized for further verification and closed monitoring of information at Headquarters before submitting to respective banks.

The Department of Social Welfare has been identified as priority and is currently working closely with ITC on improving its database through e-governance.
At the same time, we are in the process of drafting our Standard Operational Procedure to improve efficiency and effectiveness of the whole system.

1.

Adrea Namalo – 101-105318-CNB-5577674 Vilomena Senivuta – same as above Adrea is receiving allowance for the daughter Vilomena Senivuta 2.

Ram Pyare – 503-103192 –CNB-6232675.


Daulat – as above 13 Finance Instruction 2005 section 4.1.17 14 Interim Government Cabinet Paper (07) 26 Date 13/02/07 Department of Women, Social Welfare and Housing Section 21: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Ram Pyare is the recipient of FA.

Daulat is the son who is receiving allowance on behalf of the father.

3.
3.

Juleka Bibi – 401-106937- ANZ-09375391 Suleka Bibi – same as above The discrepancy has been identified as receiving two allowances.

The allowance for the above has been terminated.

This happened due to the recipient having a different name on the Birth Certificate to that given at the time of the application.

1.
1.

Kalesi Marama – 402- 105340 –ANZ -09393172 Marama Qiokata – same as above The above two are the same person using different names.Marama Qiokata is the name in the Birth Certificate, hence the name in the Bank Account.

5.

Etalia Sawea – 201-104176 – ANZ – 09343619 Etalia Debalevu – same as above.

Etalia Debalevu is the name in the Birth Certificate, hence in the Bank account.

They are the same person.

6.


Kamla Wati Dutt – 201 – 102511 –ANZ 07453025 Kamla Wati – same as above Kamla Wati is the name in the Birth Certificate hence in the Bank account.
21.14 Recipients receiving assistance through Voucher Book and Bank Mode Cabinet approved that recipients of the FA Allowance are to select the method of payment that is accessible and cost effective provided by postal services, ANZ Rural Banking and Colonial National Bank.15 In certain cases the recipients of FA Allowance were cashing the voucher books provided by postal services as well as receiving assistance through the banking Mode.

Refer to Table 21.12 for examples.


Table 21.12: Recipients assisted through Voucher Book and Bank Mode Reference Number 101-102189 101-102370 101-105318 Voucher Book # 16173 19743 613 Bank Amount $ 60.00 CNB 60.00 ANZ 100.00 CNB Account Number 5990514 09373008 5577674 Amount $ 80.00 60.00 100.00 This issue highlights a total disregard by the Welfare officers to verify the list of recipients through voucher books and bank mode.
The Senior Welfare officers have failed to check the lists as the double payments were not picked by them.

Recommendations • • One mode of payment should cease immediately and the overpaid allowance should be recovered.

Surcharge action should be taken against officers who are identified to be responsible for the double payment.
15 Interim Government Cabinet Paper (07) 26 Date 13/02/07 Department of Women, Social Welfare and Housing Section 21: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The entire list should be checked by the Senior Welfare Officers before they are submitted for payments.
Departments Comments Elenoa Likumocevakaca’s book was issued as bank account was invalid [CNB 5990514] this was due to the fact that the file was updated for $80.00 but the database records of $60.00 remained.

The bank account was therefore closed.

Mikaele Naibuka’s account was invalid [ANZ 09373005], monies returned to the Department and mode changed to voucher book.

Andrea Namalo’s allowance was sent to the bank [CNB 5577674] and a voucher book also prepared.
The anomaly was identified and voucher book withdrawn immediately.

There was no loss to Government as immediate action was taken.

21.15 Increase in allowance without SWO’s Approval The volume of a commitment for FA is to remain with the current policy limits of minimum $60 and maximum $100.16 Any change in the approved amount for assistance should be done after a through review to ascertain that some changes in circumstance really warrants an increase or decrease in the rate of assistance.
A recipient (Reference # 101-109026) file was transferred from Nausori Welfare Office to Nasinu Welfare Office where she was receiving $60.

However it is noted that she is now receiving $80.00 from Nasinu Post Office.

There was no justification for the increase in allowance as no review was conducted on the recipient.

Hence, the possibility of favouritism could not be ruled out.
Recommendations • • A through assessment should be conducted on all recipients of FA allowance to ascertain the need for an increase.

The officer responsible for increasing the allowance should provide explanations for his/her actions.

Departments Comments Such incidences are not common as in the e-welfare programme amounts payable can only be changed by the SWO with their own password.

The anomaly has been identified and the allowance has been suspended pending further investigations.
21.16 Recipients Uplifting Two Voucher Books Welfare officers are responsible for the dispatch of voucher books during the collection time.17 16 Finance Manual 2005 Section 4.1.9 17 Finance Manual 2005 Section 4.1.33 Department of Women, Social Welfare and Housing Section 21: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 i. ii.

iii.

They are required to confirm the identities.

Ensure that the clients sign off on the dispatch reports.
Recipients must sign on voucher.

Some recipients are uplifting two voucher books via different reference numbers.

Refer to Table 21.13 for example.
Table 21.13: Recipients who Uplifted Two Voucher Books BIO Data Name Fathers Name Date of Birth Reference Number Post Office Amount $ BIO Data Name Fathers Name Date of Birth Reference Number Post Office Amount $ BIO Data Name Fathers Name Date of Birth Reference Number Post Office Amount $ BIO Data Name Fathers Name Date of Birth Reference Number Post Office Amount $ Recipient 1 Akeneta Volasiga Sisa Lealea 24/01/64 101-102742 Samabula 60.00 Recipient 2 Akeneta Ledua Volasiga Sisa Lealea 24/01/64 101-106702 Samabula 80.00 Recipient 1 Iliesa Tuilakeba Peni Raisele 17/03/35 104-105081 Tubou 60.00 Recipient 1 Bimla Wati Begum Prasad 01/01/59 101-105342 Suva 61.00 Recipient 1 Jitoko Seru Jone Bacau 08/04/1924 104-106101 Cakova 60.00 Recipient 2 Iliesa Tuilakeba Peni Raisele 17/03/35 104-106270 Tubou 60.00 Recipient 2 Bimla Wati Begum Prasad 03/06/59 101-102536 Samabula 61.00 Recipient 2 Jitoko Seru Jone Bacau 08/04/1924 104-106134 Keteira 60.00 for application Remarks The via reference number 101-106702 was not approved by the SWO yet the voucher books were printed Remarks Physical reference number 104-106270 was not produced for audit purposes.
file for Remarks Physical reference number 101-102536 was not produced for audit purpose.

file for Remarks There are two posting agencies on the same Island The above discrepancies clearly indicate that Welfare Officers deliberately created two reference numbers for recipients.

They had also failed to identify these recipients during the voucher book collection time.

Recommendations • • • Appropriate disciplinary action should be taken against the welfare officers responsible for the double payments.
The Welfare Officers should be more vigilant while distributing the voucher books to identify recipients uplifting two voucher books.
Recovery action should be taken from the above recipients for the double payments made Department of Women, Social Welfare and Housing Section 21: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Departments Comments Akeneta Volasiga Akeneta Ledua Volasiga’s 101-102742 101-106748 Elderly Prisoner Dependent Iliesa Tuilakeba Iliesa Tuilakeba 104-105081 104-106270 1st payment received 1/1/04 1st payment received 8/12/05 An application was filled in December 2002 and the second application was filled in January 2003.
Both the applications were actioned but the payments were on hold due to the unavailability of funds.

This happened because a large number of applications were received from the Maritime Zone and were being translated onto the English version of the forms and the double application could not be detected at that time because of the large numbers.

The double payment was detected in June 2007 and the voucher book [104-106270] was terminated immediately.
Bimla Wati Bimla Wati Jitoko Seru Jitoko Seru 101-105342 101-102536 104-106101 104-106134 Approved on 23/7/2003 Approved on 26/11/2003 One recipient for 2 vouchers books.

Akeneta Volasiga’s case was an error of the Auditors as they are two different individuals.

Jitoko Seru will have both accounts terminated from July 2008.

21.17 Review of Family Assistance Recipients Controls need to be in place to ensure that the right recipient continues to receive the funds under the family assistance program.
A review of family assistance recipients is not conducted regularly and this can result in the Department not knowing if and when a recipient has died.

Thus, funds may continue to be paid out to relatives of the deceased recipient who does not qualify for the assistance.

The table below shows examples of cases not reviewed on regular basis.
Table 21.14: Recipients not reviewed on Regular basis Recipient Gonedau Cabemaiwai Vetinia Pateta Laisani Vakuruivalu Sukh Mati Parvati Gurdin Reference Number Date of Last Review 101-103405 101-102948 101-102769 101-105507 101-103115 15/03/05 31/03/05 15/04/05 19/09/02 14/03/05 There are no checks in place where the department can detect whether a recipient has passed away.
There is no work program available where welfare officers could visit the various recipients to determine whether a certain recipient is still living and receiving the approved allowance.

Department of Women, Social Welfare and Housing Section 21: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • • The Department should carry out a yearly review of the recipients.
Work program should be drawn for Welfare officers to visit homes of recipients to determine whether the recipients are still living and receiving the allowances.

Departments Comments Periodical review is in place.

One of the strategies is the introduction of ID Certificate and ID card which recipients need to produce during the uplifting of voucher books.

This is followed by home visitation by Welfare Officers.
Given the number of recipients on our roll, the lack of vehicles and the high number of vacancies, regular review of all cases is a mammoth task and which now has become near impossible to achieve.

Apart from Family Assistance review, Poverty Alleviation Projects and Care & Protection Allowance cases also need to be reviewed on a regular basis.
21.18 Revenue Variances Each Accounting Head shall ensure that revenue is recorded against the correct account; the recording of revenue is reconciled monthly with the Ministry of Finance; the Ministry of Finance is advised of any errors or discrepancies within 10 working days after the end of each month.18 Revenue totalling $187,057 disclosed in the financial statements was derived from the FMIS records.
However audit has noted that the Department is not a revenue collecting agency and it is not aware of the nature of revenue appearing under the Head 24.

The audit also could not substantiate the accuracy of the total revenue received during the year as shown in the financial statements.

Recommendation The Ministry should immediately reconcile the revenue accounts.

Ministry’s Comment 21.19 Drawings Account Reconciliation All bank accounts shall be reconciled monthly.
The bank reconciliation shall list the outstanding cheques and other items and be signed and dated by the responsible officer.19 The Department had not prepared the Drawing Account reconciliations for 2007.

As of the date of audit, the department had only prepared reconciliations for January 2007.

The possibility of fraud and error can not be ruled out.
18 Finance Instruction 2005 – Section 30 (1) 19 Finance Instruction Section 39 (5) - 2005 Department of Women, Social Welfare and Housing Section 21: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • The Department should carry out monthly reconciliations of the Drawings account on a regular basis.

• Explanations should be sought from the Senior Accounts Officer.
Departments Comment 21.20 Operating Trust Fund Account By the nature of Operating Trust Account it should always have a credit balance at the end of each month.

However audit noted that the trust fund balance for the Department of Women and Social Welfare had debit balances as at 31/12/07.

The debit balances indicate that the Department of Women and Social Welfare had overdrawn its Operating Trust Account.

Refer to Table 21.15.


Table 21.15: Details of Overdrawn Balance Month Closing Balance $ Dept Social Welfare December (23,178.32) Closing Balance $ Dept Women (10,875.48) Recommendation The Ministry should ensure that credit balance is maintained in the Trust Fund Account at all time.
Departments Comment 21.21 Losses Report Details of losses incurred each year shall be reported in the agency’s annual financial statement in accordance with the reporting format set out in these Instructions.20 The Department failed to prepare the losses report for 2007.

Recommendation The Department should prepare a losses report in accordance with Finance Instruction 82.
Departments Comment 20 Finance Instruction Section 66 - 2005 Department of Women, Social Welfare and Housing Section 21: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 21.1: Statement of Output Costs General Administration Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Value Added Tax Notes 2007 $ 2006 $ 1,004,659 132,800 41,706 69,708 37,654 259,000 - 1,545,527 1,127,312 163,488 31,889 70,309 38,713 484,030 50,000 1,965,741 - - 1,051,367 1,051,367 8,700 78,477 3,719,917 3,807,094 153,426 176,210 TOTAL EXPENDITURES 2,750,320 5,949,045 Poverty Eradication Unit Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Notes 2007 $ 2006 $ 39,171 - 9,679 7,814 916 - - 57,580 - - - - 56,387 9,028 9,336 6,377 78 - 70,779 151,985 - 2,586 - 2,586 Value Added Tax 5,021 27,860 TOTAL EXPENDITURES 62,601 182,431 Department of Women, Social Welfare and Housing Section 21: Page 22 REPORT OF THE AUDITOR GENERAL OF THE
 REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Institutional Services Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Notes 2007 $ 2006 $ 146,041 127,232 2,187 23,925 10,450 - - 309,835 - - - - 165,076 152,369 1,494 17,431 8,299 - -
 344,669 - - - - Value Added Tax 10,292 16,180 TOTAL EXPENDITURES 320,127 360,849 Field Services Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Value Added Tax Notes 2007 $ 2006 $ 1,102,493 102,247 35,634 50,553 99,243 18,211,568 6,100 19,607,838 1,271,385 123,909 33,709 47,637 68,513 14,896,158 20,127 16,461,438 - - - - - 31,556 - 31,556 160,337 112,621 TOTAL EXPENDITURES 19,768,175 16,605,615 Department of Women, Social Welfare and Housing Section 21: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Women and Gender Development Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Notes 2007 $ 2006 $ 569,615 45,100 46,831 30,356 12,263 - - 704,165 - - 280,492 280,492 659,457 48,211 61,002 44,027 213 - - 812,910 - - 339,195 339,195 Value Added Tax 28,059 67,078 TOTAL EXPENDITURES 1,012,716 1,219,183 Housing Description EXPENDITURES Operating Established staff
 Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURES Notes 2007 $ 2006 $ 119,599 2,292 20,000 32,000 6,398 1,000,000 31,773 1,212,062 330,647 - 1,112,000 1,442,647 - 2,654,709 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Department
 of Women, Social Welfare and Housing Section 21: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 21.2: Real and Bogus Name with Same Bank Account Number BIO Data Name Reference Number Bank Account Number Amount Per Month BIO Data Name Reference Number Bank Account Number Amount Per Month BIO Data Name Reference Number Bank Account Number Amount Per Month BIO Data Name Reference Number Bank Account Number Amount Per Month BIO Data Name Reference Number Bank Account Number Amount Per Month BIO Data Name Reference Number Bank Account Number Amount Per Month BIO Data Name Reference Number Bank Account Number Amount Per Month Real Recipient Adrea Namalo 101-105318 CNB 5577674 100.00 Real Recipient Ram Pyare 503-103192 CNB 6232673 60.00 Real Recipient Juleka Bibi 401-106937 ANZ 09375391 60.00 Real Recipient Kalesi Marama 402-105340 ANZ 09393172 60.00 Real Recipient Etalia Sawea 201-104176 ANZ 09343619 64.00 Real Recipient Kamla Wati Dutt 201-102511 ANZ 07453023 60.00 Real Recipient Mitieli Rokoua 201-103474 ANZ 09362825 60.00 Bogus Recipient Vilomena Senivuta 101-105318 CNB 5577674 100.00 Bogus Recipient Daulat 503-103192 CNB 6232673 60.00 Bogus Recipient Sulekha Bibi 401-106937 ANZ 09375391 60.00 Bogus Recipient Marama Kqiokata 402-105340 ANZ 09393172 60.00 Bogus Recipient Etelia Debalevu 201-104176 ANZ 09343619 64.00 Bogus Recipient Kamla Wati 201-102511 ANZ 07453023 60.00 Bogus Recipient Mitieli Roakalau 201-103474 ANZ
 09362825 60.00 Department of Women, Social Welfare and Housing Section 21: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 BIO Data Name Reference Number Bank Account Number Amount Per Month BIO Data Name Reference Number Bank Account Number Amount Per Month Real Recipient Sekove Ravoka 201-106194 ANZ 09368055 60.00 Real Recipient Arun Lata 301-103169 CNB 1998121 75.00 Bogus Recipient Saloma Ravoka 201-106194 ANZ 09368055 60.00 Bogus Recipient Arun Lata 301-101967
 CNB 1998121 75.00 Department of Women, Social Welfare and Housing Section 21: Page 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 22 Ministry of Youth, Sports and Employment Opportunities Programme Statement The Ministry of Youth, Employment Opportunities & Sports is responsible for: The formulation and implementation of policies and programs aimed at enabling youths to meet challenges of their generation and create a better future through informed choices; and The promotion and development of sports and its infrastructure both in the urban and rural areas in recognition of the important role of Sports in nation building, and to create a vibrant and highly competitive sports industry which will be economically beneficial to Fiji.
Table of Contents 22.1 22.2 22.3 22.4 22.5 FINANCIAL STATEMENT ..................................................................................................................... 1 Audit Opinion ............................................................................................................... 1 Statement of Receipts and Expenditures ..................................................................... 2 Statement of Output Costs........................................................................................... 2 Appropriation Statement .............................................................................................. 3 Statement of Losses .................................................................................................... 3 AUDIT FINDINGS ................................................................................................................................. 3 22.6 Authority for Expenditure ............................................................................................. 3 22.7 Sports Grant – Non Submission of Acquittals .............................................................. 5 Ticket Allocation Netball World Cup-2007.................................................................... 6 22.8 Appendix 22.1 – Statements of Output Costs ........................................................................... 8 FINANCIAL STATEMENT 22.1 Audit Opinion The audit of the 2007 accounts of the Ministry of Youth, Sports and Employment Opportunities resulted in the issue of a qualified audit report.
The qualifications are as follows: a) The Ministry had consolidated its expenditures into four Statement of Output Costs whereas the Budget Estimates 2007 prescribes six outputs.

The facility to allow the measurement and accounting of output costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

It is not possible therefore to determine the accuracy of the expenditures incurred by the Office under each output.
b) The Ministry has not provided a Trust Account Statement of Receipts and Payments in accordance with section 82(1) of the Finance Instructions.

The Finance Management Ministry of Youth, Sports and Employment Opportunities Section 22: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Information System shows that the Trust Account had a balance of $367,270 as at 31 December 2007.
22.2 Statement of Receipts and Expenditures The Ministry incurred a total expenditure of $6,303,962 in 2007 compared to $5,784,633 in 2006.

Details are provided in Table 22.1.
Table 22.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Operating Revenue Total State Revenue Agency Revenue Miscellaneous Revenue Sales of School Farm Produce Total Agency Revenue 2007 $ 2006 $ 32,708 32,708 1,922 1,922 12,337 8,468 20,805 51,839 4,851 56,691 TOTAL REVENUE 53,512 58,612 EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 1,444,876 141,492 89,348 112,603 313,108 976,924 2,462,106 5,540,457 1,394,568 138,542 129,837 173,171 349,775 1,033,167 1,152,192 4,371,252 140,404 - 71,583 211,987 383,015 - 488,114 871,129 Value Added Tax 140,404 383,015 TOTAL EXPENDITURES 6,303,962 5,784,633 22.3 Statement of Output Costs Audit could not determine the accuracy of the expenditures in each of the Statement of Output Costs.
The statements are detailed in Appendix 22.1.

Ministry of Youth, Sports and Employment Opportunities Section 22: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 22.4 Appropriation Statement The Ministry incurred expenditures totalling $6,303,962 in 2007 against the budget of $7,732,325 resulting in a savings of $1,428,363 or 18%.

Details of expenditures against the budget estimates are provided in Table 22.2.
Table 22.2: Appropriation Statement for 2007 Actual Expenditure $ Carry – Over $ Lapsed Appropriation $ SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants and Transfers Total Capital Expenditure 13 Value Added Tax Budget Estimate $ 1,456,850 173,855 109,820 134,350 346,243 1,076,200 3,278,707 6,576,025 150,000 0 300,000 450,000 706,300 Changes $ 111,000 (39,757) 71,243 Revised Estimate $ 1,456,850 173,855 109,820 134,350 346,243 1,187,200 3,238,950 6,647,268 1,444,876 141,492 89,348 112,603 313,108 976,924 2,462,106 5,540,457 39,757 (111,000) 71,243 189,757 - 189,000 378,757 140,404 0 71,583 211,987 706,300 551,518 TOTAL EXPENDITURE 7,732,325 7,732,325 6,303,962 0 0 0 0 0 0 0 0 0 0 0 0 0 0 11,974 32,363 20,472 21,747 33,135 210,276 776,844 1,106,811 49,353 - 117,417 166,770 154,782 1,428,363 The Ministry of Finance approved the transfer of $71,243 between the SEGs under the Department’s head.
22.5 Statement of Losses The Ministry did not incur any loss of assets during the financial year ending 31/12/07 AUDIT FINDINGS 22.6 Authority for Expenditure For funds placed under requisition, the approval of the Minister of Finance must be sought before funds can be expended for the purposes identified in the Annual Budget.1 Audit noted that for the following funds which were under Requisition (R), the Ministry had spent more than the amount approved by the Minister of Finance.
1 Finance Instruction (9) (1) - 2005 Ministry of Youth, Sports and Employment Opportunities Section 22: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 22.3: Details of amount spent without approval Allocation Item Description Budgeted Amount Total Amount Committed RIE Approved Amount 25-2-1-6 25-2-1-6 25-1-2-6 25-1-2-8 25-2-1-7 25-2-1-10 Overseas Sporting Tours Sports Outreach Programme National Youth Services National Youth Training Centre Upgrade WNC Team Preparation Rural Sports Field TOTAL $ 100,000 100,000 350,700 150,000 350,000 89,000 1,139,700 $ 89,330 75,202 328,085 102,317 378,754 8,524 982,212 $ 63,000 50,000 261,915 68,051 350,000 0 792,966 Amount Spent Without Approval $ 26,330 25,202 66,170 34,266 28,754 8524 189,246 The Ministry failed to follow proper procedures in incurring expenditures resulting in excess expenditures totalling $189,246.
Recommendations • • The Ministry should ensure that amounts approved in the RIEs are not overspent.

Appropriate disciplinary action should be taken against the officer(s) responsible for the over-expenditures.

Management Comment Relevant RIE applications for the funds highlighted were submitted to Finance well within the year in line with the Department’s approved budget to facilitate various programmes and activities scheduled for 2007.
Unfortunately, RIEs totalling in excess of $1.0m were later declined and returned to the Department in late November, 2007 for reasons best answered by Finance.

It must be noted that the various programmes and activities were implemented in line with scheduled dates set earlier in the year by the various divisions through its divisional work plans.
However, your recommendations are noted and every precaution is being taken to ensure that expenditure incurred is confined to approve RIEs even at the expense of deferring and suspending planned programmes, activities, etc.

A) WNC Team Preparation For clarification purposes, please note the total expenditure of $378,754 includes the sum of $129,617 relating to WNC liability payment which had a separate budget of $130,000.
Relevant RIEs for both, WNC Team Preparation ($350,000) and WNC Liability ($130,000) were approved by Finance.

B) Rural Sports Field The RIE application for Rural Sports Field submitted in the 1st quarter of 2007 was eventually declined and returned in November, 2007.
Out of the $200,000 budget $111,000 was vired to the Fiji Rugby Union World Cup Preparation leaving a balance of $89,000 Ministry of Youth, Sports and Employment Opportunities Section 22: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 A cheque of $7,457.14 was received from the Hoby Cat Championship Organizing Committee which was credited to the Rural Sports Field allocation to facilitate the hire cost of the Department’s D6 machine (fuel, parts, operator’s weekly wages, cartage of machine, etc) The D6 machine was hired to carry out clearance and construction works on the Laucala Bay shoreline in anticipation of the 2007 Hobby Cat Championship.
22.7 Sports Grant – Non Submission of Acquittals The recipient organization within two weeks of utilizing the grant is required to return to the Ministry evidence of expenditures with all acquittal details including receipts, invoices and vouchers before the end of each quarter or the release of the next grant.2 Audit of the funds provided to the sporting bodies in 2007 revealed that many of these bodies had failed to submit their acquittals.
Refer to Table 22.4 for examples of acquittals still outstanding.
Table 22.4: Non Submission of Acquittals Date Recipient 17/10/07 26/10/07 15/10/07 26/10/07 9/10/07 20/03/07 21/08/07 18/04/07 13/03/07 31/07/07 18/04/07 29/08/07 Hobie Cat 16th World Championship Fiji Weight Lifting Association Fiji Rugby Union Fiji Swimming Association Fiji Basketball Federation Fiji Surfing Association Fiji Association of Sports & National Olympic Committee Fiji Triathlon Association Shooting Association of Fiji Fiji Squash Association Fiji Baseball Association Fiji Hockey Federation Amount ($) Time lapsed since the due date 234,868 4 months 7,330 4 months 111,000 4 months 2,500 4 months 2,500 4 months 3,000 11 months 298,796 6 months 3,000 10 months 2,500 11 months 1,500 7 months 2,500 10 months 14,000 6 months In the absence of acquittals it would be difficult to assess how effectively the grants had been used and whether grants have been used for the intended purposes.
Recommendations • • The Ministry should ensure that acquittals are submitted on a timely basis.

All acquittals should be supported by invoices and vouchers otherwise an audited financial statement should be submitted.

Ministry’s Comment SRL RECIPIENT 1.

Hobbie Cat AMOUNT ($) 234,868 TIME LAPSE SINCE THE DUE DATE 4 months REMARKS The Ministry had enquired from Dr Robin Mitchell on the acquittals and the response was sent to the Auditor Generals Office.

“All documents are with the auditors”.


2 Agreement between the Government of the Republic of the Fiji Islands and Sports Association.

Ministry of Youth, Sports and Employment Opportunities Section 22: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 SRL RECIPIENT Fiji Weightlifting Fiji Rugby Union Fiji Swimming Fiji Baseball Association Fiji Surfing Association FASANOC Fiji Triathlon Shooting Association of Fiji Fiji Squash Fiji Hockey Federation 2.

3.

4.

5.

6.
3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.
AMOUNT ($) 7,330 111,000 2,500 2,500 3,000 298,796 3,000 2,500 1,500 TIME LAPSE SINCE THE DUE DATE 4 months 4 moths 4 months 4 months 11 months 6 months 10 months 11 months 7 months REMARKS Acquitted on 3/4/08 Acquitted in 2007 Acquitted on 6/12/07 Acquitted in 2007 Acquitted on 25/4/08 The Honorary Secretary is finalizing report and should be submitted to the Ministry by Monday Week, 28/4/08 Fiji Basketball Fiji Association of Sports and National Olympic Committee 298,796 6 months Acquitted in 2007 Most of the sporting bodies do not have full time administrators to look after the submission of acquittal details and meeting the requirements stipulated in the Agreement, thus the submission of acquittals normally takes time.
The Ministry had reminded the sporting bodies concerned and will continue to do so until the outstanding acquittals are received.

 The procedure in place is that “no sporting body with outstanding acquittals” will receive any further funds until the previous acquittal is received and verified by the Ministry.
We note the above recommendation and for the disbursement of future grants will indicate the following; “if funds are not submitted within the time frame stipulated in the Agreement, no sporting body will be given anymore funds for the year”….

Even if a sporting body is qualified to participate at any major World Championships like the Olympic Games.
22.8 Ticket Allocation Netball World Cup-2007 Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.

Audit noted that NZ$15,000 was spent by the Ministry upon request by Netball Fiji for the purchase of the 2007 Netball World Championship tickets.

Audit noted that Netball Fiji had ordered 20 sets3 of tickets for the whole tournament.
Audit scrutiny revealed a number of anomalies: • • • • the number of tickets ordered was unplanned and no justification was provided to the Ministry on the number of tickets to be purchased; 4 sets of tickets costing $3,000 were unused and were returned to the Ministry of Youth and Sports; 3 sets of unused tickets had to be sold from which the expenses incurred in 2007 were paid off.

the allocation of the tickets were bias and uneconomical.
Refer to Table 22.5 for details: 3 A set refers to tickets for all the matches.
Ministry of Youth, Sports and Employment Opportunities Section 22: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 22.5: Ticket Allocation Name Mr. Rajesh Singh Number Sets 1 set Mrs. Erenavula Mrs. Rabuka Mrs. Nalatu Mr. & Mrs. Bari & Miss Bari Coaches (Taina,Melaia,Alumeci) Delegates Driver Physiotherapist Mr. John Sachs 1 set 1 set 1 set 3 sets 3 sets 1 set 1 set 1 set of Reason for ticket allocation Former Minister, request was made by the Ministry of Youth and Sports, Mr. Lekh Ram Vayeshnoi.
The netball player, Ana Erenavula’s mother.

The netball player, Mere Rabuka’s mother.

Simone Nalatu’s Mother Family of Talei Bari 3 FNA Coaches, who attended the netball coaching program in New Zealand.

Delegates Driver in New Zealand Physiotherapist for the Fiji netball team Husband of one of the 3 coaches mentioned above.

The number of tickets purchased was not economical and the allocation of the tickets was bias and resulted in wastage of tax payers’ funds.
Recommendation The Ministry should exercise proper economy in the expenditure of public funds at all time and funds should be used for authorized purposes only.
Ministry’s Comments According to the Ticket Allocation Order Form provided to Netball Fiji by the WNC Organizing Committee there was a maximum of 20 per team mentioned, thus the order of 20 tickets The 4 sets of tickets which remained unused was the result of dissemination on a daily basis upon requests by the Fijian supporters and fans in New Zealand.

This led to some of the days tickets missing from the pack.
The Ministry notes this and for future disbursement of funds such as this that a more stringent procedure be used.

 For future programs when the ministry is given such responsibility, that a Ministry official be assigned to be part of the team and to be responsible in looking after these funds for the organization during any overseas travel.
Ministry of Youth, Sports and Employment Opportunities Section 22: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 22.1 – Statements of Output Costs General Administration 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 546,713 57,303 37,758 38,042 136,516 134 1,092,380 1,908,846 - - - - 493,388 55,500 67,080 72,509 159,969 - - 848,446 - - - - Value Added Tax 222,187 141,622 TOTAL EXPENDITURES 2,131,033 990,068 Youth Development 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 697,531 69,043 30,938 58,170 37,046 262,207 386,191 1,541,126 715,836 67,482 39,125 77,446 46,179 310,288 498,043 1,754,399 140,404 - 63,050 203,454 383,015 - 101,968 484,983 Value Added Tax 154,121 249,894 TOTAL EXPENDITURES 1,898,701 2,489,276 Ministry of Youth, Sports and Employment Opportunities Section 22: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER
 2008 Development, Research, Public Relation 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 101,459 - 3,458 991 15,763 177 - 121,848 88,075 - 4,564 1,512 21,408 - - 115,559 - - - - - - - - Value Added Tax 14,542 24,697 TOTAL EXPENDITURES 136,390 140,256 Sports Development 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 99,174 15,147 17,194 15,400 123,783 714,407 983,536 1,968,641 97,269 15,560 19,069 21,705 122,218 722,879 654,149 1,652,849 - - 8,533 8,533 - - 386,145 386,145 Value Added Tax 160,668 126,040 TOTAL EXPENDITURES 2,137,842 2,165,034 Ministry of Youth, Sports and Employment Opportunities Section 22: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 23 Ministry of Agriculture, Fisheries and Forestry Programme Statement The Agriculture Sector needs to refocus, diversify, be market driven and improve efficiency
 in its service delivery to realise the sector’s full potential.
Diversification into niche export and domestic markets is therefore necessary thus priority will be given to: facilitating private sector involvement in the development of agri-business; capacity building of farmers to raise levels of production from semi-subsistence to commercial levels; and enhancement of Tourism and Agricultural linkages; promote food security and ensure sound land management and development.
In addition, the Forestry Department would promote further training and skills development through its Forestry Training Centres and support the sustainable development of Forest resources and processing with respect to national exports.

Similarly, the Department of Fisheries would strengthen its extension services, research and training capacity to facilitate fisheries and marine product processing for local and export markets.
Table of Contents 23.1 23.2 23.3 23.4 23.5 23.6 CONSOLIDATED FINANCIAL STATEMENT ........................................................................................ 2 MINISTRY OF AGRICULTURE............................................................................................................. 2 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditure....................................................................... 3 Statement of Output Costs........................................................................................... 3 Appropriation Statement .............................................................................................. 3 Statement of Losses .................................................................................................... 4 Profit and Loss Statement – Trading and Manufacturing Activity ................................. 4 AUDIT FINDINGS ................................................................................................................................. 5 FNPF RECONCILIATION ............................................................................................ 5 23.7 23.8 Lending Fund Account Not Written Off......................................................................... 6 23.9
6 23.9 Outstanding Accountable Advance .............................................................................. 7 Renting of Premises to Rewa Rice Limited and Government Supplies.................... 8 23.10 Poor Debt Recovery ................................................................................................ 9 23.11 DEPARTMENT OF FISHERIES .......................................................................................................... 10 FINANCIAL STATEMENT ................................................................................................................... 10 Audit Opinion ......................................................................................................... 10 Statement of Receipts and Expenditure................................................................. 11 AUDIT FINDINGS ............................................................................................................................... 11 Nabouwalu Fisheries Office (Revenue Collection – Ice Plant) .............................. 11 Issuing of Outside Demarcated Area [ODA] Fishing License................................. 13 Wainikoro Rural Fisheries Service Centre Project ................................................. 14 DEPARTMENT OF FORESTRY ......................................................................................................... 16 FINANCIAL STATEMENT
 ................................................................................................................... 16 Audit Opinion ......................................................................................................... 16 23.14 23.15 23.16 23.12 23.13 23.17 Ministry of Agriculture Fisheries and Forestry Section 23: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 23.20 23.18 23.19 Statement of Receipts and Expenditure................................................................. 16 Profit and Loss Statement – Trading and Manufacturing Activity........................... 17 AUDIT FINDINGS ............................................................................................................................... 18 FNPF Reconciliation.............................................................................................. 18 DEPARTMENT OF LAND RESOURCES PLANNING AND DEVELOPMENT .................................... 19 Acting Allowance for Agriculture Officer for Estates............................................... 19 23.21 Financial and Administrative Function of the DSAP Grant ..................................... 20 23.22 23.23 Farming Assistance Scheme [FAS] and Land Resettlement Scheme.................... 22 Appendix 23.1: Statement of Output Costs............................................................................ 27 Appendix 23.2: DSAP acquittals for the year 2007
 ................................................................ 36 CONSOLIDATED FINANCIAL STATEMENT The Ministry of Agriculture, Fisheries and Forestry have not consolidated their financial statements as required.
MINISTRY OF AGRICULTURE FINANCIAL STATEMENT 23.1 Audit Opinion The audit of the 2007 accounts of the Ministry of Agriculture resulted in the issue of a qualified audit report.

The qualifications are as follows.

 The Ministry of Agriculture has not consolidated its financial statements with the Department of Fisheries and Department of Forests as required.
The amounts in the Statement of Output Costs have been estimated as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

It is not possible therefore to determine the accuracy of the expenditures incurred by the Ministry under each output.

 The Ministry has not provided a Trust Account Statement of Receipts and Payments contrary to Finance Instructions 82(1).
The Financial Management Information System as at 31/12/07 shows an overdrawn balance of $512,485 in the Operating Trust Fund Account and a balance of $499,791 in the Main Trust Account.

 There is a significant variance between the VAT records and the accounts as at 31 December 2007.
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The opening balances for various accounts in the Trading and Manufacturing activities including opening stock were not transferred to the new chart of accounts of the Finance Management Information System.

The stock certificates as at 31/12/07 were not provided for audit.
23.2 Statement of Receipts and Expenditure The Ministry incurred a total expenditure of $32,946,449 in 2007 compared to $45,081,294 in 2006.
Descriptions RECEIPTS State Revenue Operating Revenue Total State Revenue Agency Revenue Entity Revenue Total Agency Revenue TOTAL REVENUE EXPENDITURES Operating Expenditure Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure 2007 $ 2006 $ 543,168 543,168 488,441 488,441 108,015 108,015 651,185 308,577 308,577 797,018 13,524,617 4,974,016 537,050 1,484,766 340,374 897,509 234,626 14,430,374 6,656,955 557,635 1,632,558 660,892 989,097 401,686 Total Operating Expenditure 21,992,958 25,329,197 Capital Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 4,694,209 380,069 2,655,367 7,729,645 10,753,991 256,764 4,836,120 15,846,875 Value Added Tax TOTAL EXPENDITURE 3,223,846 32,946,449 3,905,222 45,081,294 23.3 Statement of Output Costs The Department consolidated its expenditures into Statement of Output Costs.
These are detailed in Appendix 23.1.

23.4 Appropriation Statement The Ministry incurred expenditures totalling $32,946,449 in 2007 against a revised budget of $38,464,700 resulting in a savings of $5,518,251 or 14%.
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE 13,488,800 4,879,800 629,200 1,714,500 432,200 979,200 388,500 22,512,200 6,991,200 408,800 4,950,000 12,350,000 3,602,500 38,464,700 Budget Estimate Change Revised Estimate 513,400 424,400 0 0 14,002,200 5,304,200 629,200 1,714,500 Actual Expenditures 13,524,617 4,974,016 537,050 1,484,766 Lapsed Appropriation 477,583 330,184 92,150 229,734 0 0 0 0 0 (937,800) Statement of Losses The Ministry’s losses during the year is in respect sheep deaths.
The value of sheep which died in 2007 totalled $9,323 compared to $4,466 in 2006.

23.6 Profit and Loss Statement – Trading and Manufacturing Activity The amounts in this statement could not be reconciled to the accounts in the Financial Management Information System.
Descriptions Sales Opening Stock Add: Purchases 2007 $ 2006 $ 593,816.65 838,932.00 8,232.00 8,232.00 257,619.28 169,251.04 Total Stock available for sale 265,851.28 177,483.04 Less: Closing Stock (220,850.84) (8,232.00) Less: Cost of Goods Sold (45,000.44 ) (169,251.04 ) Gross Profit 548,816.21 669,680.96 Gross Profit transferred from Trading A/C 548,816.21 669,680.96 Total Income Less: Expenses Administrative costs 548,816.21 669,680.96 15,287.00 87,988.00 Net Profit 533,529.21 581,692.96 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The individual transactions were not posted directly to the Financial Management Information System.
They were manually prepared and posted at summary level in the accounts.

The reconciliations were incorrect and did not agree to the general ledger.

Stock certificates were not submitted for audit.


AUDIT FINDINGS 23.7 FNPF RECONCILIATION At the end of each month a reconciliation statement shall be completed and retained for audit purposes to ensure that all the entries made to the control account agree with the final monthly total.1 Scrutiny of the Department’s FNPF and Salaries records revealed a significant variance.
Refer to details provided Employers Contribution ($) ($) SEG 1 Established Staff SEG 2 Unestablised staff Add: FNPF of Other Allowances Related Payments 924,174.20 155,990.79 103,994.05 Add: December 2007 Employers Contribution Less: December 2006 Employers Contribution Total Employers Contribution Employees Contribution Salaries & Wages & Allowance as per FS Less: Salaries not subject to FNPF Salaries, Wages & for 2007 Employers Contribution 8% of $17,192,539.73 Variance 1,184,159.04 134,268 1,318,471 179,488 1,138,938.76 17,192,539.73 1,375,403.18 236,464.42 17,418,468.06 225,928.33 The inconsistency in the reconciliations and poor monitoring by the Ministry has resulted in the variance of $236,464.
Recommendation The Ministry should take necessary steps to reconcile and account for the variance noted.

Management Comments No Comments.

1 Finance Instructions (1982) Section 84 (3).
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 23.8 Lending Fund Account Not Written Off Each year, losses which are considered not recoverable and which do not exceed the limits set below for the type of loss may be written off by the Chief Executive Officers - unserviceable assets $6,000; abandonment of claims $1,000; loss of assets or livestock $1,000; loss of money $500.2 Write-off in excess of these limits shall be referred to the Minister of Finance.3 Since 1990 the Ministry provided equity to co – operative farmers through the Lending Fund for its Cocoa Development Scheme based on the Government’s Import Substitution Policy to enhance the cocoa project with the assistance of the Department of Co-operatives as its executing agency.
The funds loaned to these farmers totalled $16,279 was for operational and establishment costs.

The Ministry did not seek Ministry of Finance approval to write- off the cocoa scheme outstanding balances and further enquiry revealed that these debtors were either dissolved, non-operating or non- existent.

Refer to details provided.
Date Organisation Loan Amount ($) Date/Reasons of Dissolution 27/02/90 27/02/90 27/02/90 27/02/90 27/02/90 27/02/90 23/10/90 23/10/90 23/10/90 27/02/90 27/02/90 27/02/90 27/02/90 27/05/91 13/06/91 27/11/94 TOTAL Saturaga Farmers Co-op Dreketi/Nadrau Farmers Co-op Navuabale Farmers Society Leleuvia Farmers Co-op Nacoliva Farmers Co-op Sinumatiavi Farmers Co-op Vunitavola Farmers Co-op Salatu/Nakoro Farmers Nabuke/Lobau Farmers Bureduguvaki Farmers Co-op Nakoro Farmers Co-op Rova Farmers Co-op Nataqiri Farmers Lawaki Farmers Co-op Laqavolo Farmers Co-op Lutuya Farmers Co-op Recommendation 188.00 15/03/07 303.00 2007 394.90 2007 1,278.48 13/03/07 418.00 13/03/07 317.50 Non-operating 616.30 23/10/06 692.9 14/03/07 941.00 15/03/07 1,018.97 13/03/07 1,301.67 Non-operating 469.48 11/04/07 326.80 No records 1,354.05 13/03/07 983.00 No records 2,000.00 15/03/07 12,604.05 The Ministry should seek the Ministry of Finance for an approval for write the irrecoverable debts.
Management Comments A submission on write-off of the Lending Fund Account, dated 07/03/08 was forwarded to Chief Accountant who would consider write-off of loans issued to various Cooperative organizations whilst existed during the early nineties-mid nineties.
2 Finance Instruction s68(1) 3 Finance Instruction s68(2) Ministry of Agriculture, Fisheries and Forestry Section 23: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 23.9 Outstanding Accountable Advance Where an advance has not been acquitted within 7 days of returning from a travel, the Principal Accounts officer shall effect recovery through a salary deduction after obtaining the Deputy CEO approval.4 Several officers failed to retire their accountable advances on time or meet the 7 days requirement.
Refer to details provided.
Date Issued 29/01/07 7/3/2007 20/03/07 28/03/07 13/04/07 8/5/2007 21/05/07 4/6/2007 13/06/07 21/06/07 28/06/07 29/06/07 6/7/2007 10/7/2007 11/7/2007 12/7/2007 18/07/07 20/07/07 20/07/07 23/07/07 24/07/07 21/07/07 25/07/07 26/07/07 30/07/07 30/07/07 30/07/07 EDP No 45984 18573 45182 13098 48378 18573 62907 49941 40479 41832 47423 49993 48956 19378 40237 60565 66297 19882 60211 16039 18365 45622 45556 61911 63472 18564 13771 Names ROPATE LIGAIRI HIAGI FORAETE SANAILA TURAGA UNAISI NAIKATINI JONE MATAWALU HIAGI FORAETE TEVITA NATASIWAI ANA TURAGANIVALU MOSESE LEDUA SEREANA TUILOVONI MILIAKERE NAWAIKULA TAITUSI NAIDUKI ISIKELI TUITUBOU VIRENDRA KARAN TIMOCI RASOVO MERE RAYAWA ANARE LEWECOLO MOSESE RATUKI VIREND CHAND KINI NAMOUMOU RUSIATE LALADIDI NAPOLIONI SERU JAMES ANTONIO JOSAIA MAINAWARAKA VAREA PANAPASA ALIKI TURAGAKULA ALMA TAYLOR Amount 2,508.00 600.00 149.50 318.00 4,297.25 1,900.00 4,392.90 651.50 384.00 1,440.00 442.03 698.00 198.00 822.00 302.00 1,269.00 207.00 176.64 168.00 648.00 300.00 600.00 346.00 153.60 54.00 104.00 2,321.77 The delay in the retirement of accountable advance is a serious breach of government procedures and regulations.
The lack of supervision resulted in the accumulation of uncleared advances.

Recommendations • The Ministry must ensure that staffs are reminded on the clearance of accountable advances in accordance with Ministry of Finance requirements.

• The Ministry should recover any outstanding advances directly from the salaries of the officers concerned.

4 Ministry of Agriculture Finance Manual 10.1.14.


Ministry of Agriculture, Fisheries and Forestry Section 23: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments (i) (ii) The Outstanding Accountable Advance was recorded through officer’s salary deductions.

‘Accountable Advance written off Without Finance Authority’ was nothing more than a book entry where movement of funds was not involved therefore Finance approval was not warranted.
The accountable advance was not cleared, though, the deceased, retired, terminated and resigned officers retired their advances.

According to records on hand no proper accounting or reconciliations were carried out in these accounts during nineties as evident from credit balances in individual advances accounts, outstanding balances in Postmasters Accounts and overall balance of 1.9 million standing as at to-date in the RCC reports.
The reconciliation process is now taking place and we would advise your office of the progress.
23.10 Renting of Premises to Rewa Rice Limited and Government Supplies The Public Service Commission is responsible for ensuring that adequate office accommodation is provided for the public service.5 The Secretary of the Public Service shall authorize tenancies of land and buildings for office accommodation and other official purposes6 and also conduct negotiations for renting of premises.7 The Rewa Rice Limited has been renting the Ministry of Agriculture old office yard located at Shales Ramjan Street (Labasa) for a considerable time at a monthly premium of $200 payable to the Principal Agricultural Officer (Northern) office in Labasa since occupying the office in 2003.
Audit could not ascertain whether a valuation of the property was carried out to determine the fair market value of the rented premises.

Similarly the Government Supplies Office used the same office for its sales and distribution outlet without a valid agreement.

Audit noted that the signed agreement between Rewa Rice Limited and the former Principal Agricultural officer Northern in April 2005 was made without the consent of the Permanent Secretary.
Moreover the agreement was not vetted by the Solicitor General’s Office.

The company was to take full responsibility for the water and electricity charges but charges for water and electricity are being paid by the Ministry because these were registered under the Ministry.

The above findings reflect the failure of the Ministry to enforce the provisions in the agreement with Rewa Rice.

The absence of an agreement with Government Supplies Department is also a concern.
Recommendations • The Ministry should investigate the matter and take appropriate actions.

• The Ministry should recover from Rewa Rice Limited amounts for electricity and water charges from the date the company occupied that Office.

• The Ministry should ensure that Public Service Commission is involved in any matter concerning office accommodation.

5 Public Service Act (1999) Section 11 (1) (i).

6 General Order (1993) Section 1212.

7 General Order (1993) Section 1213 (b).
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments (i) Renting premises to Rewa Rice and Government Supplies Authority to the renting and occupation of these premises to Rewa Rice Limited was made, probably by the former Principal Agricultural Officer {Northern} and according to stories heard from some staff by Mr Samisoni Ulitu when he was Deputy Secretary for Agriculture.
Looking through the files, no records of this ownership are there.

But as of now, rent is now properly being paid by Rewa Rice Limited ($250 per month).

Further, they are also paying water and electricity bills for their office.
(ii) Occupation of old yard by Government Supplies This old yard building had been in state of disrepair and after Commissioner Northern/Principal Supplies Officer and Acting Principal Agricultural Officer’s discussion, it had been approved for Principal Supplies Officer Northern to renovate the building from the idea of developing the North [Look North Policy].
23.11 Poor Debt Recovery The credit officer must promptly follow up accounts that fall due and if recovery is unsuccessful after one month, then no further credit shall be extended to the debtor.8 Audit noted that the Lautoka Quarantine Divisional Office continued to provide services to companies who owe arrears of revenue which are more than three months.

Refer to details provided.
Debtors Carpenters Nestle Jaiv Clearance General Machinery Punja & Sons Shipping Services Paccon Logistices Campbell Shipping Lautoka Customs Invoice # 30276 30284 30288 30290 30368 30369 30370 30371 30413 32822 30488 30226 30227 30267 30310 30396 30415 30434 30433 32802 32808 32809 32813 30438 32831 30460 30441 Dated 22/6/07 26/6/07 26/6/07 26/6/07 13/7/07 13/7/07 13/7/07 13/7/07 25/7/07 10/8/07 25/7/07 5/6/07 5/6/07 21/6/07 2/7/07 25/7/07 25/7/07 2/8/07 2/8/07 6/8/07 7/8/07 7/8/07 7/8/07 2/8/07 21/8/07 27/8/07 2/8/07 Amount ($) 44.97 62.95 26.98 62.95 62.95 62.95 62.95 103.94 67.45 26.98 26.98 62.95 140.9 395.66 154.9 33.98 146.90 127.94 2,832.37 62.95 26.98 102.95 62.95 434.6 67.45 147.92 125.9 Total ($) 585.07 26.98 62.95 536.56 463.72 2,832.37 255.83 649.97 125.90 8 Finance Manual 2005, s.9.2.1 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Dayals Sawmillers International Freight Advance Custom TOTAL 32815 32838 30452 30316 30338 32814 7/8/07 21/8/07 27/8/07 2/7/07 7/7/07 7/8/07 139.4 130.4 125.9 62.95 116.92 26.98 395.70 179.87 26.98 6,141.90 The practice could result in high arrears of revenue.
Recommendation The Ministry should advise these customers that services would cease until some payment arrangements are in place.

Management Comments No Comments.

DEPARTMENT OF FISHERIES FINANCIAL STATEMENT 23.12 Audit Opinion The audit of the 2007 accounts of the Department of Fisheries resulted in the issue of a qualified audit report.

The qualifications are as follows.


a) b) The Department of Fisheries has not consolidated its financial statement with the Department of Forests and Ministry of Agriculture as required.

The Department of Fisheries has not provided the following contrary to Finance Instructions 82(1): (i) Statements of Output Costs; (ii) an Appropriation Statement; (iii) a Statement of Losses; and (iv) a Trust Account Statement of Receipts and Payments.
The Financial Management Information System shows that the Department of Fisheries as at 31/12/07 has a balance of $27,731 in the Main Trust Fund.

Ministry of Agriculture, Fisheries and Forestry Section 23: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 23.13 Statement of Receipts and Expenditure The Department incurred a total expenditure of $10,543,037 in 2007 compared to $5,364,240 in 2006.
Descriptions RECEIPTS State Revenue Operating Revenue Total State Revenue Agency Revenue Entity Revenue Total Agency Revenue TOTAL REVENUE EXPENDITURE Operating Expenditure Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Special Expenditure Total Operating Expenditures Capital Capital Construction Total Capital Expenditure 2007 $ 2006 $ 233,718 233,718 296,431 296,431 376,462 376,462 610,180 782,046 782,200 1,078,477 2,375,185 473,423 82,367 571,863 67,323 4,276,636 7,846,797 1,730,662 401,847 94,136 608,316 62,993 - 2,897,954 1,380,474 1,853,509 1,380,474 1,853,509 Value Added Tax 1,315,766 612,777 TOTAL EXPENDITURE 10,543,037 5,364,240 AUDIT FINDINGS 23.14 Nabouwalu Fisheries Office (Revenue Collection – Ice Plant) The revenue collector shall verify each entry in the register against money received before issuing a receipt and noting receipt details in the register.9 The type of revenue which will be considered for revenue retention includes the sale of ice.10 The Department of Fisheries rate for selling ice to a licensed fisherman is $0.11 per kilogram and for non licensed fisherman is $0.26 per kilogram.
A businessman Mr. Liakat Khan purchased ice on numerous occasions at the licensed fisherman’s rate of $0.11 per kilogram instead of being levied $0.26/kg.

Refer to examples extracted from the Nabouwalu Ice Plant records in respect of sale of ice to Liakat Khan.

9 Department of Fisheries and Forestry Finance Manual (2005) Section 5.3.9 10 Finance Instructions (2005) Section 32 (1) (a) (v).
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Dates 10/3/07 15/3/07 20/3/07 14/4/07 21/4/07 24/4/07 1/5/07 7/5/07 8/5/07 14/5/07 18/5/07 24/5/07 31/5/07 6/6/07 11/6/07 13/6/07 19/6/07 23/6/07 30/6/07 5/7/07 10/7/07 13/7/07 17/7/07 18/7/07 20/7/07 23/7/07 TOTAL Revenue Receipts 105046 105123 105162 105254 105297 105361 105396 105427 105436 105488 105488 105513 105539 381709 381736 381749 381771 381807 381836 381853 381879 381898 381919 381925 381936 381944 Weights (kg) 800 1,454 1,090 1,454 1,500 1,090 1,454 818 1,090 1,090 1,454 1,454 1,454 1,454 1,454 1,454 1,454 700 1,454 1,454 1,454 800 1,200 800 1,454 1,454 32,788 Kg Amount Paid ($0.11) 88.00 159.94 119.90 159.94 165.00 119.90 159.94 89.98 119.90 119.90 159.94 159.94 159.94 159.94 159.94 159.94 159.94 77.00 159.94 159.94 159.94 88.00 132.00 88.00 159.94 159.94 3,606.68 Amount to be Paid ($0.26) Difference The levying of the licensed fisherman’s rate to the businessman is suspicious and should be investigated further by the Ministry of Finance.
Recommendation • The Ministry should investigate this case and instigate surcharge actions against the officer responsible.

• The Ministry should ensure that only licensed fisherman are issued ice at the approved rate.
Management Comments Upon our investigation on the Ice Plant revenue collection as highlighted by the Auditor, the following explanation from the Officer-In- charge, Fisheries Sub-Station in Nabouwalu was provided: The Fisheries Department does admit that there was some misunderstanding in the price of ice given to the businessman in question.

The businessman is the owner of the fishing vessel and he was acting on behalf of his vessel captain, to buy ice instead of the captain, himself.
The officer at Nabouwalu acted in good faith in issuing ice to Mr. Liakat Khan but failed to receipt it under the captain’s, name.

Even though the ice sales record stated that the transaction was against the financial regulation, it did not take away the fact that Mr. Liakat Khan was the legal owner of the boat and the captain work, under him.
The particulars of the valid Fishing Licence for the year 2007 for vessel captain employed by Mr. Liakat Khan were as follows: Ministry of Agriculture, Fisheries and Forestry Section 23: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 1.

Captain of Fishing Boat: Mr. Bob Joy of Nasarowaqa, Bua.

• Fishing Permit No.

439486 of 30th January 2007.

• Permit Area: Raviravi Fishing Grounds.

• Fishing Licence No.

4163 of 8th February 2007.

• Vessel Registration No.


BN264.

Further OAG Comments Audit discussion with the Lekutu Ice Plant attendant on 16/11/07 revealed that Mr. Liakat Khan has been buying ice from the Nabouwalu Ice Plant even when the Lekutu Ice Plant was in operation.
23.15 Issuing of Outside Demarcated Area [ODA] Fishing License Any person to take fish from any “qoliqoli” should first obtain a permit from the Commissioner of the Division in which such area is situated and issuance of such license is consistent with the Internal Demarcated Area (IDA).11 Regulation 4A specifically deals with offshore licensing which is outside the internal waters or “qoliqoli”.

There is no provision in the Fisheries Act Cap 158 for the issue of ODA fishing licenses.
Issuance in the past is believed to be “temporarily” for vessels mainly used for pole fishing and snapper fishery because there are no provisions in the Act to fish in the archipelagic and territorial waters.

Hence the Department continued to issue ODA licenses.12 Two ODA licenses were issued to Mr. Ieremaia Mata and Mr. Sushil Kumar from the Nabouwalu Office without a permit number.

Refer to details provided.


Names License Dates of Revenue Address Other Details Numbers Issue Receipt Mr. Ieremaia Mata 41151 5/5/07 105421 Namena, Tailevu.

Crew of 3 & Captain.

Mr. Sushil Kumar 41160 13/7/07 381896 Cunningham, Naitasiri.

Crew of 3 & Captain.

Issuing ODA licenses which is not legislated by the Act is blatant disregard of the regulations for offshore fishing.
Recommendation • The Ministry should investigate the issuance of ODA license when it is not stipulated in the Act and take appropriate disciplinary actions against the officer’s responsible.

• The Ministry should ensure that ODA licenses are cancelled immediately.

11 Fisheries Act Cap 158 Sections 5 and 13.

12 Memorandum by Acting Director Fisheries to Acting Senior Fisheries Officer Northern Dated 27/5/2005.
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments The management acknowledges the discrepancies surrounding the issuance of ODA Licenses, which is not stipulated in the Fisheries Act.
The discrepancies had been basically inherited over the years from previous Licensing Officers through their mis-interpretation while Inside Demarcated Areas [IDA] Fishing Licenses had been issued to fish within the Customary Fishing Rights Areas however all other fishermen wanting to fish outside the Customary Fishing Rights Areas were issued with ODA Licenses as this had been the mis- interpretation.
The mis-interpretation was further exacerbated in certain cases where fishers had difficulties in obtaining consents for Resource Custodians to fish in Customary Fishing Rights Areas.

This problem has been addressed under the Offshore Licenses for the issuance of Fishing Licenses to Fish for Deepwater Snapper, which is stipulated under the Marine Spaces Act.

Please be informed that Fisheries Sub-Station Officer at Nabouwalu had been reprimanded not to issue ODA Fishing License.
The other 16 Fisheries Sub-Station Officers have also been duly advised to take heed of the no- ODA license policy and the management would ensure such practice will not occur in future.
23.16 Wainikoro Rural Fisheries Service Centre Project 23.16.1 Payment of Contracts for “Chattel” not Honoured by Cooperative Members In order to contribute to the achievement of rural development through coastal fisheries development, the objective of the project is to increase income for artisanal fishermen from fisheries activities.13 The objective of the co – operative shall be:14 • • • to buy and market members marine products and ensure that maximum benefits is reaped for the members; to help increase earning capacity of members; to create more rural employment and economic activities within the area of operation.
The hirer shall sell to the Wainikoro Fisheries Co-operative (WFC) not less than 300 kilograms of fish per month of their catch.15 The WFC Limited was registered on 15/4/04 and the Labasa Co–operative Department facilitated the trading license through the Labasa Town Council for an outlet in Labasa Town, which was opened for business on 26/8/04.16 If the hirer commits any breach of any terms or conditions of the Wainikoro Fishermen Cooperative Society Limited agreement, it shall be lawful for the WFC to terminate the hiring and retake possession of the said chattels (outboard engine and fibre glass boat)17 and that the hirer shall ensure that monthly repayments shall be derived from the sales of their catch to the WFC.18 The Co-operative societies who were assisted by WFC fisheries scheme did not honour the agreement and did not meet the monthly loan repayments.
The last repayments were carried out between December 2006 and July 2007.

No payments have been received since.

Refer to details of amounts owed by the WFC members.

13 MOU between the Overseas Fishery Cooperation Foundation of Japan & Ministry of Fisheries and Forestry (2002).

14 Wainikoro Fisheries Co – operative Limited Objectives 3 (f) – (h).

15 Wainikoro Fisheries Co operative Society Hiring Agreement Clause 11.
16 Memorandum for Complaint of WFC Limited (2006) by the Northern Senior Cooperative Officer.

17 Wainikoro Fisheries Co operative Society Hiring Agreement Clause 7 (a).

18 Wainikoro Fisheries Co operative Society Hiring Agreement Clause 11.
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Names Chattels Details Yahama Outboard Engine Fibre Glass Boat Nabouono Co-op Gevo Co–op Namukalau Co– op Mouta Co–op Nadogo Co–op Nayalava Co–op Kavewa Co–op Nukudamu Co– op Wainisuka Co–op Cakaulevu Co–op TOTAL √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ No.
of Delayed Months in Loan Repayment up to Dec 2007 6 months 8 months 11 months 5 months 2 months 5 months 6 months 5 months 5 months 9 months Monthly Rate ($) Total Repayment ($) Amount Paid ($) Balance Due ($) Last Payment Dates Terms (Months) 20/6/07 11/4/07 21/12/06 30/7/07 12/10/07 25/7/07 23/6/07 9/7/07 18/7/07 26/3/07 84 84 84 84 84 84 84 84 84 84 The members were also assisted with ice boxes of different sizes.
One of the conditions of their loan was that all the catches stored in the ice box would be sold only to WFC.

Audit noted that while the catches are stored in the ice box, these were sold to buyers other than WFC, contrary to the agreed arrangement.

Refer to photos of the fisheries equipment provided to members.
Figure 23.1: WFC Ice Box Figure 23.2: WFC Outboard Engine & Fibre Boat The absence of an incentive to allow WFC to bring their catch and appropriate recovery measures not in place could result in the project in not achieving its objectives.

Recommendation The Fisheries Department should review the process in place and the strategies to be implemented to ensure that a WFC member settles his/her loan on time.
Management Comments The Wainikoro Rural Service Centre had experienced some difficulties in the operation of its fish marketing business.

There are some stiff competitions from other market providers who have been smartly able to convince some Co-operative members by buying their grade one (1) catches at sea leaving the lower grades taken to Wainikoro.
This was one of the main draw backs to the poor performances of the Wainikoro fish business resulting in most members who loaned fishing equipments, not repaying their loan.

The Department is aware of the contract conditions to those cooperative members to whom the fishing equipment were loaned to but we are working closely with the WFC on the best strategy to get the fish purchase business in operation to enable members to sell their catches and have their loan repaid.
The cooperative members have been given seven years to repay their loans according to their contract agreements with WFC.

Ministry of Agriculture, Fisheries and Forestry Section 23: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DEPARTMENT OF FORESTRY FINANCIAL STATEMENT 23.17 Audit Opinion The audit of the 2007 accounts of the Department of Forestry resulted in the issue of a qualified audit report.

The qualifications include the following.


a) b) c) The Department of Forests has not consolidated its financial statements with the Department of Fisheries and Ministry of Agriculture as required.

There is a significant variance between the VAT records and the accounts as at 31/12/07.
The Department of Forests has not provided the following contrary to Finance Instructions 82(1): (i) Statements of Output Costs; (ii) an Appropriation Statement; (iii) a Statement of Losses; and (iv) a Trust Account Statement of Receipts and Payments.

The Financial Management Information System shows that the Department of Forests as at 31/12/07 has an overdrawn balance of $51,385 in the Operating Trust Fund.
d) The opening balances for various accounts in the Trading and Manufacturing activities including raw materials, work in progress and finished goods were not transferred to the new chart of accounts of the Finance Management Information System.

23.18 Statement of Receipts and Expenditure The Department incurred a total expenditure of $9,658,613 in 2007 compared to $23,086,263 in 2006.
Descriptions RECEIPTS State Revenue Operating Revenue Total State Revenue 2007 $ 2006 $ 570,793 570,793 800,505 800,505 TOTAL REVENUE 570,793 800,505 EXPENDITURE Ministry of Agriculture, Fisheries and Forestry Section 23: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Descriptions Operating Expenditure Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure 2007 $ 2006 $ 2,090,795 2,256,239 878,719 108,832 240,765 270,590 561,507 130,787 831,449 137,034 341,288 249,214 950,204 267,707 Total Operating Expenditures 4,281,995 5,033,135 Capital Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 4,209,076 21,300 402,478 15,087,165 31,100 267,374 4,632,854 15,385,639 Value Added Tax 743,764 2,667,489 TOTAL EXPENDITURE 9,658,613 23,086,263 23.19 Profit and Loss Statement – Trading and Manufacturing Activity Descriptions ($) INCOME Cash Sales EXPENSES Personal Emoluments FNPF Travel Domestic Travel Overseas Office Upkeep & Supplies Special Fees & Charges Vat- Input Tax NET EXPENSES 134,023.07 41,957.63 13.20 - 878.95 15,049.76 105.60 (5,424.63) 52,580.51 NET PROFIT AFTER VAT (81,442.56) Ministry of Agriculture, Fisheries and Forestry Section 23: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 AUDIT FINDINGS 23.20 FNPF Reconciliation At the end of each month a reconciliation
 statement shall be completed and retained for audit purposes to ensure that all the entries made to the control account agree with the final monthly total.19 A scrutiny of the Department’s FNPF and salaries records revealed a variance.
Refer to details below.
Employers Contribution $ $ SEG 1 SEG 2 Established Staff Unestablised staff 257,702 42,162 Add: December 2007 Employers Contribution Less: December 2006 Employers Contribution Total Employers Contribution Employees Contribution Salaries & Wages & Allowance as per FS Salaries, Wages & for 2007 Employers Contribution 8% of $5,518,257 Difference 299,864 46,451 346,315 55,587 290,728 5,518,257 441,461 150,732 5,518,257 The inconsistency in the reconciliations and poor monitoring by the Department has resulted in the variance of $150,732.
Recommendation The Department should take necessary steps to reconcile and account for the variance.

Management Comments The Management acknowledges the audit findings as had been highlighted above with the following comments: The details provided by the Auditor cannot be reconciled with figures available in the FMIS statement therefore the variance claimed couldn’t be established.

Reconciling of figures before payment is now closely monitored.

19 Finance Instructions (1982) Section 84 (3).
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DEPARTMENT OF LAND RESOURCES PLANNING AND DEVELOPMENT 23.21 Acting Allowance for Agriculture Officer for Estates A Memorandum of Understanding between South Pacific Commission and Government on its role and responsibilities of South Pacific Commission dated 4/8/03 agreed on the following primary responsibilities.20 salary for National DSAP staff; • • payment of university enrolment fees for Graduate Research and Extension Assistants (GREAs) for tertiary training preferably to undertake postgraduate studies (Masters) related to the DSAP project; funds for workshops, expenses for filed activities and travel; transportation (vehicles, motorbikes and small boats) and funds for insurance and running costs.
• • When an acting appointment requires an officer to undertake all duties and responsibilities of single officer higher than his/her own, he/she will be eligible to receive an acting allowance at a rate equal to 95% of the difference between his/her own substantive salary and minimum salary of the higher grade.21 An employee must not engage in any occupation for reward outside the public service without the written agreement of the Commission.22 Ms. Mereani Rokotuibau (EDP 61353) is a Technical Assistant in the ST05 grade with the Ministry of Agriculture of a salary of $11,175.
She was appointed by the former Director of the Department on 27/01/04 to be the Graduate Research and Extension Assistant (GREA) with DSAP from 01/01/04 and to receive supplementary salary of F$8,28323 or $690 per month.

Audit was not able to ascertain whether Public Service Commission was consulted on the additional remuneration received from South Pacific Commission.
While she was receiving the additional remuneration from SPC, the Department appointed her to be the Acting Agriculture Officer for Estates and received an acting allowance paid by the Department totalling $6,070 from 1/5/07 – 31/12/07.
Descriptions Annual Salary & Allowance 2007 Monthly Gross ($) 2007 Fortnightly Net Pays ($) Pays Total since Acting in 2007 1/5/07 – 31/12/07 Acting Appointment Period ST05 Salary ($) (A) PR03 Minimum ($) (B) Acting Allowance ($) (C) SPC Allowance ($) (D) 1/5/07 – 31/3/08 11,175 19,528 8,346 8,283 931.25 1,672.33 692.50 ***304.95 + + 5,489.10 **690.25 345.13 5,522.00 Remarks Recommended by former the LRPD Director after consulting with the current Administration Officer 27/2/07 2/3/07 respectively for the officer to act on and 20 Memorandum of Understanding between SPC and Government Roles & Responsibilities of SPC (4/8/03).
21 General Orders 465 (a) 22 Fiji Islands Government Gazette Supplement No.

21 dated 21/05/99 (Legal Notice No.
48) 23 Terms and Conditions for DSAP for the GREA Letter of Agreement Dated 27/01/04 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Descriptions Annual Salary & Allowance 2007 Monthly Gross ($) Total Personal Emoluments Note *27,804 *2,314 *(A)+(C)+(D) **Tax Exempted ***Net of Tax + + Pay 9 to 26 2007 Fortnightly Net Pays ($) 650.08 Pays Total since Acting in 2007 6,070.10 Remarks the vacant on post.
The payment of such allowances and huge responsibilities for the Officer could have an impact on the management targets and expectations of the Department due to the different roles, the Officer is being assigned to.

Recommendations • The Ministry should immediately review the acting appointment of Ms. Rokotuibau due to the additional responsibility and remuneration she is receiving from South Pacific Commission.
• The Ministry should ensure that any engagement outside public service should be disclosed to Public Service Commission.

Management Comments After the audit, I had a general discussion with your officer who informed me of the SPC allowance she was getting for DSAP on top of the acting allowance as Agriculture Officer (Estate).That was the first time I had come to know of the double payment.

We had to occupy the AO post or else we would loose it, hence the acting appointment.
An area that I am not very clear on , is, the position of the DSAP within the MOA structure , as I believe that it could have been together with the SLM, for nature of their work is similar.

All I know about is, the STA post that Miss Rokotuibau holds belongs to LRPD and we provide her with office space.

As to the DSAP budget, LRPD does not have any connection or authority over it.

Our records will show the same.

No approval for expenditure or authority to incur expenditure involves LRPD.
Everything is between Miss Rokotuibau and PSC.

23.22 Financial and Administrative Function of the DSAP Grant Circular instructions issued by Ministry of Finance contained in Finance Circular No.

5/98 of 15th April 1998, 4/2002 of 14th March 2002, 4/2003 of 18th March 2003, 14/2003 of 14th August 2003 and 21/2006 19th October 2006 outlined the guidelines to any aid funds received from donors.
These guidelines and instructions are as follows: • Ministries/Departments must seek the prior approval of the Budget and Aid Coordinating Committee (BACC) before directly negotiating with donor agencies for funding assistance; • Aid – in – kind projects must be approved by the BACC through the normal process; • All cash grants and aid funds must be appropriated for and approved by Parliament before it is released by the Ministry of Finance and National Planning.24 24 Finance Circular 21/2006 of 19/10/06.
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Each agency must have in place a cost effective system of internal controls which safeguards money and property against loss with the Accounting Head responsible to the Chief Executive Officer for the effective design and operation of internal controls across the agency.25 The National Co–operator (NC) in country shall be responsible to SPC for the national DSAP imprest account.
Under the supervision of the NC, the DSAP GREA or REA shall keep the records of the project imprest account with requisite degree of care, efficiency, transparency and diligence as required by best practice in the field concerned and compliance with the financial procedures manual.26 The MOU between SPC and the Ministry stipulates that SPC is responsible to provide the following;27 • Technical advice and training by regionally based DSAP staff that consist of participatory; • Salary for national DSAP staff; • Payment of university enrolment fees for Graduate Research and Extension Assistants (GREAs) for tertiary training relevant to DSAP and approved by the project Team Leader; • Short – term technical assistance to provide support in specialized aspects of extension and agricultural communications training, management training and assisting national agricultural research and extension services (NARES) to internalize gender issues within their activities; • Funds for workshops, expenses for filed activities and travel; • Funds for production of extension publications and communications; • Filed equipment for demonstrations (farming implementations and tools); • Office equipment and other equipment for development of extension communications materials (e.g.
computer hardware and software, copiers, tape recorder and digital camera); • Transportation (vehicles, motorbikes and small boats) and funds for insurance and running costs.

The following observations were made.

 Audit noted that the administrations and the financial affairs of the DSAP project are solely handled by the Graduate Research and Extension Assistant (GREA), Ms. Rokotuibau without the involvement of the Department’s accounts and administration section.
Audit was not able to establish whether there were any consultation to the BACC committee with Ministry of Finance by the Ministry prior to the signing of the Memorandum of Understanding between SPC and the Ministry.

 A review of acquittals provided by Ms. Rokotuibau to SPC for the year 2007 noted that the excessive meal allowances and subsistence claims.
Similarly the justifications for the utilization of the vehicle and submission of the vehicles quarterly returns could not be substantiated.

Moreover there was an expenditure incurred to provide driving license which was not part of the terms of agreement with SPC.

Refer to Appendix 23.2 for the acquittals made in 2007.

Such practice increases the risks of tampering, loss of assets, misappropriation of funds, falsifications of acquittals, abuse of inventory and backlog in reconciliations.
Recommendations • The Director for Research being the National Cooperator to supervise the officers’ responsibilities prior to submission of acquittals to SPC.

25 Section 70(1)(2) – Finance Management Act 2004 26 Memorandum of Understanding between SPC and Government of Fiji Annexure 4 4/8/03).

27 Memorandum of Understanding between SPC and Government Roles & Responsibilities of SPC (4/8/03).
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The DSAP Financial Administrations and Operations should be controlled by the Department with exception of the technical obligations which should be the responsibility of the GREA.

• The Ministry should seek the BACC committee approval on all grants funded projects by donor agencies.
Management Comments As reported by the Auditor, LRPD does not have any financial dealings with DSAP.

23.23 Farming Assistance Scheme [FAS] and Land Resettlement Scheme 23.23.1 Non utilization of Partial Payment Balances The Farming Assistance Scheme (FAS) was introduced to financially assist the incoming farmers who are taking over new farms from ex – ALTA tenants.
In addition to that outgoing ex ALTA tenants who may wish to be resettled, purchase new farms or gain rural residential leases are also assisted.
Both the incoming new tenants and outgoing tenants are to be treated fairly with the provision of equal grant of $10,000 per farmer to meet the development cost of the farmer in the first year and categorized as follows: Incoming landowner tenant: $10,000 • • Outgoing tenant opting for re – settlement: $10,000 • Outgoing tenant opting for lease renewal: NLTB cost that is offered and not more than $10,000 • Outgoing tenant opting for Residential lease: NLTB cost that is offered and not more than $10,000 • Outgoing tenant opting to purchase a new farm: $10,000.28 Expenditure properly chargeable to any financial year shall, to the extent possible, be paid within such year and shall not be deferred.29 Audit noted that there were numerous farmers that were assisted by Government that did not fully utilize the grants provided to them.
The non clearance of FAS balances appropriated by Parliament will have immense pressure on succeeding year’s budget.

Refer to details provided.

Case No.

Names CFA 199 CFA 282 CFA 157 CFA 207 CFA 179 CFA 154 CFA 151 CFA 35 CFA 150 CFA 137 CFA 297 Rt.

Vilimoni Tagicakibau Malakai Lauwalu Anare & Inoke Dreketirua Timoci Tuinamata Solomoni Domokibau Petero R. Nausu Fulori Waqabaca LaveniaC, Jeke T & Inia K Rt.
Elia N & Ropate T Sailasa Verebasaga Apimeleki Madrai Year Approved 30/4/03 21/6/04 30/4/03 30/7/03 23/6/03 5/6/02 4/9/03 12/10/01 5/6/02 5/6/02 30/3/04 Divisions Central Central Central Central Central Central Central Central Central Central Central Remarks Balance ($) 306.78 Approved in 2003 19.84 Approved in 2004 942.20 Approved in 2003 154.75 Approved in 2003 74.96 Approved in 2003 59.14 Approved in 2002 2,184.15 Approved in 2003 19.00 Approved in 2001 36.74 Approved in 2002 1,721.25 Approved in 2002 335.24 Approved in 2004 28 Guidelines & Manual of Procedures for the Farming Assistance Scheme (2002).
29 Finance Instructions (1982) Section 23 (2).

Ministry of Agriculture, Fisheries and Forestry Section 23: Page 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Case No.
Names CFA 322 CFA 262 CFA 325 CFA 32 CFA 162 CFA 219 CFA 166 CFA 117 CFA 312 CFA 103 CFA 349 CFA 255 CFA 220 CFA 62 CFA 321 CFA 212 CFA 319 CFA 124 CFA 160 CFA 300 CFA 119 CFA 92 CFA 42 CFA 260 CFA 221 CFA 436 CFA 306 CFA 458 CFA 152 CFA 404 CFA 441 CFA 383 CFA 377 CFA 165 CFA 347 CFA 392 CFA 399 CFA 459 CFA 332 CFA 346 CFA 395 CFA 451 CFA 421 CFA 432 CFA 348 CFA 357 CFA 367 CFA 409 CFA 408 CFA 369 CFA 313 CFA 440 CFA 439 CFA 444 CFA 422 Moese V Cakau Semesa Baya Lavenia Seuta Rt.
Epeli Tikoinavunimoli Serupepeli Waqatavou Nemani Sokiveta Matia Rasila Tulia Rasila Tuidama Josua Seduadua Mitieli Waqatavou Samuela Sukabula Rt.
Solomoni Buaserau Rokotuiwai Brothers Ilaisa & Mere T Inoke Tuivanuakula Semi Saro Vilikesa Rokosuka No.1 Osea Rabonu Inoke Dago Maciu Rakoro Waisale Ravono Epi T Kuna Ulaiasi Soronamata Jolame Gukirewa Peceli Lomani Ram Dulare f/n Ram Dass Jone & Mere Ukumoce Timoci Bulewa Josaia Rausiwa Tukana Ilisavani Rokoura Savenaca Bulouvale Isireli Tava Semesa & Laisani Sereicoko Ledua Toga Tuitubou Adi Lusiana Kuboulevu Raitube Matanabua Seruwaia & Suresh Chand Irami Ului Matairavula Sevanaia N Tabuakovei Joana Vakaruruvosa Nakai Josefa Vusonitokalau Noeli Fatiaki Tamani Epeli Marawa Tarai Viliame Qio Josua Rakabu Modrau Kelevi Qaqacava Rokoura Shyam Kumari f/n Shyam Sundar Budhu Ram f/n Ram Buksh Amka Prasad f/n Jug Raj Peniame Salacakau Etika Manueli Rokoleweni T Sigani Viliomone Rokoseba Tevita Cuvatoka Daya Shankar Sharma Year Approved 22/12/04 30/1/04 21/6/04 2001 5/6/02 20/11/03 27/5/03 7/12/01 22/4/02 23/11/04 25/8/04 21/6/04 6/6/03 16/7/04 21/6/04 30/4/03 21/6/04 7/12/01 20/5/03 10/2/04 21/6/04 12/10/01 2001 21/6/04 4/9/03 3/11/05 19/8/05 27/10/05 15/3/05 15/3/05 21/10/05 15/3/05 15/3/05 15/3/05 21/4/05 20/9/05 16/5/05 18/6/05 27/10/05 15/3/05 21/4/05 31/8/05 17/8/05 18/8/05 18/8/05 15/3/05 26/7/05 15/3/05 15/3/07 15/3/05 18/8/05 22/8/05 15/9/05 24/10/05 2005 Divisions Balance ($) Remarks Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central Central
 Central Central Central Central Central 1,685.64 Approved in 2004 438.15 Approved in 2004 2.439.59 Approved in 2004 75.70 Approved in 2001 528.07 Approved in 2002 821.01 Approved in 2002 41.74 Approved in 2003 3,784.70 Approved in 2001 10,000.00 Approved in 2002 637.77 Approved in 2004 55.93 Approved in 2004 495.77 Approved in 2004 19.15 Approved in 2003 2,260.80 Approved in 2004 362.41 Approved in 2004 28.48 Approved in 2003 1,399.61 Approved in 2004 4,771.10 Approved in 2001 26.44 Approved in 2003 29.73 Approved in 2004 17.15 Approved in 2004 789.67 Approved in 2001 1,088.47 Approved in 2001 7,182.55 Approved in 2004 644.45 Approved in 2003 2,675.60 Approved in 2006 5,906.71 Approved in 2006 3,185.81 Approved in 2006 61.87 Approved in 2006 7,715.44 Approved in 2006 3,691.70 Approved in 2006 1,308.31 Approved in 2006 5,427.84 Approved in 2006 7,077.65 Approved in 2006 1,518.29 Approved in 2006 1,344.44 Approved in 2006 137.21 Approved in 2006 1,476.00 Approved in 2006 1,801.67 Approved in 2006 218.25 Approved in 2006 187.520 Approved in 2006 203.96 Approved in 2006 2,914.13 Approved in 2006 28.17 Approved in 2006 463.59 Approved in 2006 156.98 Approved in 2006 1,050.00 Approved in 2006 5,507.95 Approved in 2006 6,017.17 Approved in 2006 10.25 Approved in 2006 4,268.79 Approved in 2006
 456.86 Approved in 2006 9.71 Approved in 2006 7,896.25 Approved in 2006 4,096.24 Approved in 2006 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Case No.
Names CFA 470 CFA 467 CFA 407 TOTAL Rev.

Joseva Katonibau Minati Rabuka Satya Narain f/n Gangaya Year Approved 2005 2005 15/3/05 Divisions Balance ($) Remarks Central Central Central 1,022.23 Approved in 2006 6,338.37 Approved in 2006 2,450.00 Approved in 2006 129,663.50 The delay in the clearance of these balances in the year in which approvals were made will affect the subsequent year’s budgeted cash flows.
Recommendations The Ministry should review the manner on which the unutilized balances are monitored by the Department by having quotas on the number of approved applicants per Divisions instead of focusing only on applicants that meet the scheme’s criteria.

Such exercise will properly monitor successful applicants unused balances.

Management Comments As earlier commented to by the auditor, assistance to be fully utilized the same year it was approved.
Cabinet Decision 201 of 07/11/2000, section (v) reads: ‘’ that the scheme should be fair to both the incoming landowner farmer and the resettled tenant farmer with the provision of equal grant of $10,000 per farmer to meet the development cost of the farm in the first year”.

My interpretation of this is the assistance is for one season that is only one year or first year only.

The SAO (Estate) and his team were directed to temporary close off partial payments, as they contradict the above.
If they the applicants still need the balances of their assistance, then they need to re-apply in the normal way and to be assisted accordingly, if they are included in that year’s budget.

In this way these partial payments will not unnecessarily chew into another yeas budget without them being budgeted for.

Temporary closure is being done.


23.23.2 Infrastructure Developmental Costs on Resettlement Lots The Task Force noted that Government acquired land in various locations for the resettlement of exited ALTA tenants and would continue to acquire land for this purpose.

Government has already acquire 3,172 acres of land in Navudi (Seaqaqa), Vunicibicibi (Macuata), Raiwaqa (Navua), Navovo (Nadroga) and the ex Viti Corp. land at Navua.
A farming assistance (FAS) of $10,000 will be made available to these existing tenants to assist in their new farming program.30 The principles of responsible financial management include ensuring value for money in the use of money and resources and the responsible authority for a state entity is responsible for managing the financial affairs of the entity in accordance with the requirements of the Financial Management Act with due regard to the principles of responsible financial management.31 Audit noted that although there were considerable amount of public funds incurred on the Land Resettlement scheme for ALTA farmers, audit noted that the Northern Division lots acquired remained vacant.
Refer to details provided on the costs incurred on each acquired lots.

30 Cabinet Decision No.

60 on the Report of the Sugar Industry (ALTA) Task Force (12/2/2001).

31 Sections 5 & 7 – Financial Management Act 2004 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Property Area (Hec.)
Total Lots Lots Issued Navudi Stage 1 Navudi Stage 2&3 Vunicibicibi Navovo TOTAL 153 283 233.7 432.2 1101.9 18 42 32 51 143 14 26 4 16 60 Lots Available (Vacant) 4 16 28 35 83 Land Price ($) Survey & Development Costs ($) Water Electricity Total Costs 550,000 1,145,801 761,996 465,761 2,923,558 549,981 993,580 1,174,803 1,866,975 4,585,339 20,551.51 181,523.00 555,685.56 519,647.28 1,277,407 - - - 258,360.58 258,361 1,120,533 2,320,904 2,492,485 3,110,744 9,044,665 Moreover audit noted that recipients with lots at Navudi for resettlement consisted of applicants who have received farming assistance from the Department but either failed to move to their allocated lots or vacated their lots for other reasons.
Refer to the Table below for examples.

Moreover audit noted that there was no security/mortgage to hold the applicants accountable for the funds spent since the surveyed lots are yet to be classified as Crown Agricultural Lease property by the Lands Department.

Furthermore, audit was informed that numerous farmers did not want to move to the developed areas because they were far from Labasa Town.
Refer to examples as provided in Table 35.5 such as Mr. Raven Parasad, Mr. Lek Ram, Mr. Mohd Aiyub, Mr. Brij Raj, Mr. Raza Hussain, Mr. Bimal Narayan, Mr. Basant Singh.

Names Lot No.

Stage Amounts Assisted Remarks Lot No.


1 Raven Parasad 17 Shiu Narayan Lek Ram 18 8 Mohd Aiyub 10 Brij Raj Raza Hussain Bimal Narayan Basant Singh Abdul Hussain 4 5 3 7 1 2 10 Vidya Wati 11 12 13 14 Bas Deo & Mangal Singh Arun Kumar Uday Nath Girwar Prasad 11 14 18 19 I I I I I I I I II & III II & III II & III II & III II & III II & III 9,465 Farmer physically resettled on farm in October 2003.

Now resettled at Daku, Nasasa.

NLTB offered land for cane farming.


to resettle but 9,620 Farmer died but his family is still on the farm.

is not farming 9,350 Assistance provided consistent.

Presently in Batinikama.

Farmer requesting lease documents in order to seek assistance from other agencies to solve financial problems.

5,028 Assistance provided to resettle in 2002 but the lot allocated is still vacant.

Has utilized 50% of funds allocation and balance to be paid once settled at Navudi.
living 800 Balance of $200 is still with CCSLA.

Applicant residing at Bulileka and does not show interests in farming.

7,438 Balance of $2,562 is still with CCSLA.

Farmer physically resettled in 1999 but vacated in 2003 and now residing with son – in – law at Vunimoli.

Very old and constantly ill and very old.

7,000 Assisted through the LDRU funds in 1999 and has vacated farm in 2000.

Now residing and cultivating farm in Nausori.

10,000 Application approved in 2001.


Paid the lease offer in 1999 but is still yet to move to the lot and a fisherman by trade.

Still occupying the same expired lease at Korotolutolu.

8,564 Balance with CCSLA and purchased a tractor but has not moved to the lot and still at Korokadi.

8,564 Balance with CCSLA and has cultivate the farm.

Built a farm house and has started developing the farm but is still awaiting the fund and not consistent with farming.
8,520 Balance with CCSLA and has purchased the building materials but is yet to move to the lot.

10,000 Funds with CCSLA and offer have been given but now a part time labourer with a contractor and residing at Covata.

- Declined offer as his expired lease was renewed.

10,000 Balance of $1,713.93 and not staying on the farm but now Ministry of Agriculture, Fisheries and Forestry Section 23: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Lot No.

Names Lot No.
Names Lot No.

Stage Amounts Assisted Remarks 15 Hiu Lal 42 II & III 10,000 Funds fully utilized but the farmer has not moved to residing in Suva and has left the farm house at Navudi.

TOTAL Navudi.

114,349 The above indicates that no proper feasibility study was carried out by the Ministry prior to the land procurement and development by Government.

Consequently, there was no value obtained on taxpayer funds utilized on the resettlement scheme for the Navudi stages I, II and III.
Recommendations • The Ministry should carry out a review on the need to resettle farmers in Navudi.

Consideration should also be given to optimize the returns to government on the public funds already spent in the development of Navudi.

• The Ministry should open up the farming resettlement scheme to interested farmers instead of restrictions only to ALTA tenant farmers so public funds are not wasted.
Management Comments • Your recommendation on bullet point one, was once done, with the Department going back to Cabinet to open up the resettlement of the estates in the north i.e.

Navudi 1,2,3 and Vunicibicibi to also include the landless.

To date nothing has come back, and as recommended we shall comply by getting cabinet’s approval.
• One of the reasons of this non-resettling of Navudi , can be due to it being outside or non-inclusion into the cane cultivation area for the Labasa mill, even though Navudi is surrounded by the other cane farms.

• As for your recommendation on bullet point three, the department will look at all avenues that unused balances be returned as those that this assistance was meant for had wilfully acted their lots in Navudi.

i) Navudi Stage 1, where the sub-division has been done, completed and approved.
Lots have been assigned to the farmers and assistance given.

ii) The development of land under the assistance was not able to keep the farmers permanently on the farm.

This may be due to other issues like , isolation of farms from towns, lack of public utilities like hospitals, shops , schools etc.
iii) Navudi 2 &3 where development was done, including sub-division into agricultural lots where tenants were resettled and the assistance from FAS was issued based on the recommendation from the Senior Surveyor.

Farmers were not able to use their lots as collateral, because survey plan and sub-division have not been approved.

That may be one of the causes of why farmers left the land, as no legal title has been issued due to this legal requirement.
Ministry of Agriculture, Fisheries and Forestry Section 23: Page 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 23.1: Statement of Output Costs Programme 1 – Policy and Administration Activity 1 – General Administration SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 1,632,497 450,818 223,104 502,823 366,210 853,265 0 4,028,717 0 0 1,300,000 1,300,000 2007 $ 1,536,679 318,773 258,680 479,266 71,755 816,858 47,932 3,529,943 0 0 864,179 864,179 13 Value Added Tax 301,065 281,709 Total Expenditure 5,629,782 4,675,831 Activity 2 – Economic Planning and Statistical Services SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 595,959 32,216 13,583 22,486 8,888 0 370,336 1,043,468 (7) 0 0 (7) 2007 $ 579,132 32,438 14,116 25,195 10,441 0 98,353 759,675 0 0 750,246 750,246 13 Value Added Tax 114,083 83,311 Total Expenditure 1,157,544 1,593,232 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 27 REPORT OF THE AUDITOR
 GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Activity 3 – Research SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 357,910 515,106 21,526 20,842 33,540 0 0 948,924 30 0 0 30 2007 $ 346,062 350,815 20,129 8,310 30,663 0 0
 755,979 0 0 0 0 13 Value Added Tax 84,208 86,937 Total Expenditure 1,033,162 842,916 Activity 4 – Information Services SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 201,140 7,800 3,979 2,817 26,200 0 0 241,936 0 0 0 0 2007 $ 32,346 2,842 4,590 1,598 23,579 0 0 64,955 0 0 0 0 13 Value Added Tax 27,807 13,664 Total Expenditure 269,743 78,619 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 28 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Activity 5 – Drainage and Irrigation SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 518,669 44,981 10,929 11,197 2,405 0 0 588,181 0 0 0 0 2007 $ 63,397 14,124 12,090 12,620 2,985 0 0 105,216 0 0 0 0 13 Value Added Tax 65,700 29,448 Total Expenditure 653,881 134,664 Activity 6 – Quarantine SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods &
 Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 1,880,355 92,143 16,426 29,936 29,880 0 0 2,048,740 375,966 256,576 351 632,893 2007 $ 1,682,389 98,614 16,467 26,074 19,351 0 0 1,842,895 0 380,069 0 380,069 13 Value Added Tax 253,931 254,851 Total Expenditure 2,935,564 2,477,815 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 29 REPORT OF THE AUDITOR GENERAL OF
 THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Programme 2 – Crops Activity 1 – Administration SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 1,470,282 82,525 45,035 108,744 14,888 0 0 1,721,474 13,100 0 0 13,100 2007 $ 1,392,798 99,267 38,382 132,971 1,245 0 0 1,664,663 0 0 0 0 13 Value Added Tax 121,092 184,973 Total Expenditure 1,855,666 1,849,636 Activity 2 – Extension SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 1,726,854 1,915,314 66,200 125,235 8,960 0 0 3,842,563 980,312 0 1,800,000 2,780,312 2007 $ 1,790,233 1,451,845 39,563 70,328 5,088 0 0 3,357,057 247,843 0 650,000 897,843 13 Value Added Tax 602,911 413,003 Total Expenditure 7,225,786 4,667,903 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 30 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Activity 3 – Research SEG Item Notes Established Staff Government Wage Earners Travel &
 Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Expenditure Activity 4 – Sugar Development 1 2 SEG Item Notes Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total
 Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Expenditure 1 2 2006 $ 1,507,401 1,282,370 22,557 62,784 39,166 15,413 0 2,929,691 322,671 0 0 322,671 2007 $ 1,273,282 1,012,892 18,546 52,590 27,405 0 47,196 2,431,911 79,149 0 0 79,149 320,421 310,676 3,572,783 2,821,736 2006 $ 135,535 198,452 12,250 7,620 1,371 0 0 355,228 200,867 0 0 200,867 2007 $ 33,484 117,077 4,486 3,547 2,413 0 0 161,007 0 0 0 0 67,075 38,271 623,170 199,278 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 31 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Activity 5 – Irrigation Services SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 153,415 189,423 9,178 175,020 15,703 0 0 542,739 191,280 0 0 191,280 2007 $ 115,031 131,234 7,800 150,198 16,425 0 0 420,688 235,042 0 0 235,042 13 Value Added Tax 81,923 92,469 Total Expenditure 815,942 748,199 Programme 3 – Livestock Activity 1 – Administration SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special
 Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 402,120 107,636 6,528 10,800 9,091 0 31,275 567,450 0 0 0 0 2007 $ 381,866 26,026 5,003 6,299 3,432 0 26,663 449,289 0 0 0 0 13 Value Added Tax 70,500 54,578 Total Expenditure 637,950 503,867 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 32 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Activity 2 – Extension SEG Item 1 2 3 4
2008 Activity 2 – Extension SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 1,501,590 305,174 19,446 39,869 6,027 115,480 0 1,987,586 1,082,676 0 0 1,082,676 2007 $ 1,386,775 243,234 15,158 33,182 1,149 74,356 0 1,753,854 672,342 0 0 672,342 13 Value Added Tax 316,472 286,453 Total Expenditure 3,386,734 2,712,649 Activity 3 – Research SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 172,763 458,488 5,012 28,863 45,689 0 0 710,815 131 0 0 131 2007 $ 169,533 345,075 1,778 11,716 44,676 0 0 572,778 0 0 0 0 13 Value Added Tax 71,134 65,729 Total Expenditure 782,080 638,507 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 33 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Programme 4 – Education and Training Activity 1 – Fiji College of Agriculture SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers
 Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 433,093 196,792 22,146 152,572 51,174 4,938 0 860,715 194,300 0 0 194,300 2007 $ 393,468 153,532 22,351 150,441 58,423 6,295 0 784,510 86,431 0 0 86,431 13 Value Added Tax 112,746 106,516 Total Expenditure 1,167,761 977,457 Programme 5 – Land, Drainage and Flood Protection Activity 1 – Rehabilitation SEG Item Established Staff Government Wage
 Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 740,800 590,615 0 0 52 0 0 1,331,467 5,440,303 0 0 5,440,303 2007 $ 1,894,196 428,182 0 0 0 0 0 2,322,378 3,373,402 0 0 3,373,402 13 Value Added Tax 796,068 725,968 Total Expenditure 7,567,838 6,421,748 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 34 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Programme 6 – Land Resettlement Activity 1 – Resettlement of Displaced Tenants SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 881,799 170,100 47,979 320,185 1,015 0 0 1,421,078 254,107 188 1,735,769 1,990,064 2007 $ 120,690 132,092 49,188 309,121 19,236 0 0 630,327 0 0 390,942 390,942 13 Value Added Tax 189,498 192,702 Total Expenditure 3,600,640 1,213,971 Programme 7 – Agriculture Tribunal Activity 1 – General Administration SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants
 & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 117,735 17,002 11,755 10,768 636 0 0 157,896 0 0 0 0 2007 $ 107,898 15,383 8,723 11,309 2,110 0 0 145,423 0 0 0 0 13 Value Added Tax 2,578 2,588 Total Expenditure 160,474 148,011 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 35 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Programme 8 –
 Alternative Livelihood Programme Activity 1 – General Administration SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2006 $ 454 0 0 0 0 0 78 532 1,698,195 0 0 1,698,195 2007 $ 225,357 571 0 0 0 0 14,481 240,409 0 0 0 0 13 Value Added Tax 306,012 0 Total Expenditure 2,004,739 240,409 Appendix 23.2: DSAP acquittals for the year 2007 DATES 3/7/07 3/7/07 3/7/07 3/7/07 3/7/07 3/7/07 3/7/07 3/7/07 3/7/07 10/1/07 17/1/07 17/1/07 17/1/07 31/1/07 31/1/07 31/1/07 31/1/07 6/2/07 6/2/07 6/2/07 6/2/07 16/2/07 16/2/07 16/2/07 16/2/07 20/2/07 20/2/07 CHEQUE NO.
000565 000566 000567 000568 000569 000570 000571 000572 000573 000574 000575 000576 000577 000579 000580 000581 000582 000583 000584 000585 000586 000587 000588 000589 000590 000591 000592 PAYEES Eliki Sorova Sarju Prasad Josaia Koli Doreen Ram Etuate Sauvakatoga Rajnesh Narayan Akariva Duwai Nareo Mulea Jone Nakau Akbar Capricorn Hotel Mereani Carpernters Eurocars Tyreline Virendra Chand Mereani Rokotuibau Rakiraki Hotel MH Express Sudhakar Mereani Winglee Motors Nivis Motors Rajesh Anand Nikhils Driving School Hop-Tiy Carpernters DESCRIPTIONS Meal Claim Meal Claim Meal Claim Meal Claim Meal Claim Meal Claim Supply of 3000 kava cuttings Supply of 1500 kava cuttings Supply of 1500 kava cuttings Fuel for Rakiraki Station Accommodation Meal Claim & Reimbursement Fuel for EN644 Service of EN644 Tyres for EN644 Meal Claim GREA salary Accommodation for GREA & driver Fuel Meal Claim Meal Claim Power steering box GL 634 Engine Oil GL634 Meal Claim GREA's driving lesson Sharlon Shade for YPD site Fuel AMOUNTS ($) 45.00 18.00 99.00 9.00 108.00 99.00 450.00 225.00 225.00 322.00 85.00 130.00 90.00 979.00 800.00 27.00 690.25 170.00 100.00 36.00 36.00 200.00 45.86 90.00 250.00 1,676.00 100.00 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 36 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DATES 20/2/07 20/2/07 20/2/07 9/3/07 9/3/07 14/3/07 14/3/07 14/3/07 14/3/07 14/3/07 14/3/07 14/3/07 14/3/07 14/3/07 28/3/07 28/3/07 28/3/07 28/3/07 28/3/07 11/4/07 11/4/07 11/4/07 11/4/07
 11/4/07 11/4/07 18/4/07 18/4/07 26/4/07 26/4/07 11/5/07 14/5/07 14/5/07 11/6/07 20/6/07 13/7/07 13/7/07 13/7/07 13/7/07 13/7/07 13/7/07 20/7/07 23/7/07 23/7/07 23/7/07 23/7/07 7/8/07 13/8/07 20/8/07 20/8/07 20/8/07 20/8/07 20/8/07 31/8/07 31/8/07 18/9/07 CHEQUE NO.
PAYEES DESCRIPTIONS Refreshment Meal Claim Meal Claim Reimbursement for Rakiraki Workshop GREA ticket Meal Claim Meal Claim Meal Claim Meal Claim Meal Claim Provision of rourou plants Fuel for GM764 MH Express Josaia Koli Epeli Rasaqa SPC Air Fiji Kavaia Veiqati Manasa Nasilivata Josaia Rasigawale Akuila Raibevu Joeli Waradi Ulaiasi Nasilivata Mobil Solomone Nagaunavou Meal Claim Mereani Rokotuibau MH Express Kavesi Bativesi MH Express Takia Hotel Mereani Rokotuibau Hop-Tiy Marine Drive West Motor Inn Cash Sakur moh'd Mereani Rokotuibau Nikhils Driving School LTA Mereani Rokotuibau Cash Mereani Rokotuibau Eurocars Cash Mereani Rokotuibau Air ticket West Motor Inn Eurocars Anil Kumar Mereani Rokotuibau Cash Mereani Rokotuibau Temalesi Amuna West Motor Inn Sakur moh'd Mereani Rokotuibau Cash (Carpenters) Cash (Carpenters) Cash Sakur moh'd Mereani Rokotuibau Cash West Motor Inn Mereani Rokotuibau Cash Mereani Rokotuibau Natset Office GREA salary Fuel for EN644 & GM764 Provision of pineapple suckers Cash - fuel for GM081 Accommodation for GREA Meal Claim Sharlon Shade Oil change GM618 Accommodation Fuel Meal Allowance Meal Allowance
 Driving Fees Driving License DSAP GREA GREA salary Servicing EN644 Tilivalevu Farmers Tour GREA salary Accommodation Repairs to vehicle – EN644 Meal Allowance Meal Allowance Fuel, Recharge Card, Stationeries Monthly salary Reimbursement for Carrier Accommodation Meal Allowance Meal Allowance Fuel Fuel Fuel & Meals Meal Allowance Meal Allowance Fuel & Recharge Accommodation Monthly salary Fuel, Transport, Meals September Salary Stationeries Ministry of Agriculture, Fisheries and Forestry AMOUNTS ($) Section 23: Page 37 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 CHEQUE NO.
DATES 18/9/07 18/9/07 24/9/07 24/9/07 24/9/07 24/9/07 24/9/07 24/9/07 24/9/07 24/9/07 10/10/07 17/10/07 17/10/07 17/10/07 23/10/07 23/10/07 24/10/07 24/10/07 29/10/07 29/10/07 1/11/07 1/11/07 7/11/07 7/11/07 7/11/07 12/11/07 19/11/07 26/11/07 26/11/07 26/11/07 26/11/07 26/11/07 11/12/07 11/12/07 11/12/07 17/12/07 17/12/07 17/12/07 17/12/07 TOTALS PAYEES Babasiga Fuel Government of Fiji Agchem Akbar Auto Services Hop-Tiy Ram Sami West Motor Inn Carpenters Anil Kumar Mereani Rokotuibau Mereani Rokotuibau Cash Hotel Takia Mereani Rokotuibau Ram Sami Cash Jim & Sivo Carpernters Cash Akuila Cama Timoci Vakaboro Auto Mech Cascablanca Mobil Mobil Mobil Cash Cash Hop-Tiy Mereani Rokotuibau Hotel Takia Cash Auto Mech DSAP LTC Mereani Rokotuibau Mereani Takia Hotel Agchem Hop-Tiy DESCRIPTIONS AMOUNTS ($) Fuel for North Internet connection - FCA Insecticides Fuel for Rakiraki Station Seeds for demo plots Poultry Manure Accommodation Fuel Meal Allowance Meal Allowance Monthly salary Air ticket, fuel Accommodation Meal Allowance Poultry Manure Meals & Fuel Meal Allowance Nursery Materials Fuel Meal Allowance Training in Drawa Servicing EN644 Accommodation Fuel Meal Fuel PRA Training – Tavua PRA at Ravuka Sharlon Shade Monthly salary Accommodation PRA at
 Nadarivatu Servicing EN644 Annual Meeting Monthly salary Air ticket, meal Accommodation Chemicals for Nabalabala Seeds for demo plots $35,489.30 Ministry of Agriculture, Fisheries and Forestry Section 23: Page 38 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 24 Ministry of Lands and Mineral Resources Programme Statement The Ministry of Lands and Mineral Resources is made up of two Departments, namely the Department of Lands and the Department of Mineral Resources.
The Department of Lands is responsible for the administration, development and management of all state land property.

Activities under this programme include Land Valuation, Mapping, Development and Maintenance of State Land and Geographic Information System.
The Department of Mineral Resources undertakes studies in relation to geological hazards, mineral prospectivity and groundwater development and manages the development of the Mining and Quarrying Sector with a mandate under the Mining, Petroleum (Exploration and Exploitation), Quarries, Explosives and Continental Shelf Acts.
Table of Contents 24.1 24.2 24.3 24.4 24.5 CONSOLIDATED FINANCIAL STATEMENT ........................................................................................ 1 DEPARTMENT OF LANDS - FINANCIAL STATEMENT....................................................................... 2 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditure....................................................................... 2 Statement of Output Costs........................................................................................... 3 Appropriation Statement .............................................................................................. 3 Statement of Losses .................................................................................................... 3 AUDIT FINDINGS ................................................................................................................................. 4 24.6 Payment of Sky Pacific for Former Interim Minister’s Office......................................... 4 24.7 Telephone Bills ............................................................................................................ 5 Lease Reassessment Not Done .................................................................................. 5 24.8 24.9 Charging of Retrospective Rent due to Late Re-assessment....................................... 6 Eskay Motors (Fiji) Ltd - CL 013134
 ........................................................................ 8 24.10 No re-assessment carried out on Crown Lease....................................................... 9 24.11 Non Compliance with Crown Land Act (Cap 132).................................................. 10 24.12 DEPARTMENT OF MINERAL RESOURCES - FINANCIAL STATEMENT ......................................... 13 Audit Opinion ......................................................................................................... 13 Statement of Receipts and Expenditure................................................................. 14 Statement of Output Costs .................................................................................... 14 AUDIT FINDINGS ............................................................................................................................... 14 Payment of Overtime without Budgetary Allocation ............................................... 14 24.16 24.17 Engagement of Consultant without Signed Agreement.......................................... 15 Appendix 24.1: Statement of Output Costs – Lands Department........................................... 17 24.13 24.14 24.15 CONSOLIDATED FINANCIAL STATEMENT The Department of Lands and Department of Mineral Resources have not consolidated their financial statements as required.
Ministry of Lands & Mineral Resources Section 24: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DEPARTMENT OF LANDS - FINANCIAL STATEMENT 24.1 Audit Opinion The audit of the 2007 accounts of the Department resulted in the issue of a qualified audit report.

The qualifications are as follows.

• The Department of Lands did not consolidate its accounts with the Department of Mineral Resources as required.
• The Department of Lands did not provide a Trust Account Statement of Receipts and Payments contrary to section 82 (1) of the Finance Instructions.

The Financial Management Information System shows that the Ministry of Lands as at 31/12/07 has a balance of $1,372,965 in its Operating Trust Fund Account.
• The amounts in the Statement of Output costs are estimates as the facility to allow measurements and accounting of costs are yet to be integrated in the Financial Management Information Systems (FMIS) of Government.

It is not possible therefore to determine the accuracy of the expenditures incurred by the Ministry under the two outputs.

• There is a significant variance between the VAT Records and the accounts as at 31 December 2007.
24.2 Statement of Receipts and Expenditure The Department incurred a total expenditure of $36,653,662 in 2007 compared to $37,709,869 in 2006.
Description RECEIPTS State Revenue Operating Revenue Total State Revenue 2007 $ 2006 $ 14,312,024 14,312,024 9,541,600 9,541,600 TOTAL REVENUE 14,312,024 9,541,600 EXPENDITURES Operating Expenditure Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditures Capital Expenditure Capital Purchase Capital Construction 4,753,389 584,608 273,095 25,069,745 349,822 1,335,952 78,249 32,444,860 5,230,901 529,200 322,161 25,143,549 417,341 1,698,988 80,952 33,,396,092 82,495 304,764 38,667 274,722 Ministry of Lands & Mineral Resources Section 24: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Capital Grants & Transfers Total Capital Expenditures 869 388,129 150,000 463,389 Value Added Tax 3,820,673 3,850,388 TOTAL EXPENDITURE 36,653,662 37,709,869 24.3 Statement of Output Costs The Statement of Output Costs consolidates the 3 outputs prescribed in the Budget Estimates.
These are detailed in the Appendix 24.1 24.4 Appropriation Statement The Department incurred expenditures totalling $36,653,662 in 2007 against a revised budget of $37,923,539 resulting in a savings of $1,269,877 or 3%.
SEG Descriptions Budget Estimate ($) Appropriation Changes ($) Revised Budget ($) Actual Expenditures ($) Lapsed Appropriation ($) Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure 5,281,000 799,800 116,700 26,217,000 261,800 1,500,000 667,600 34,843,900 - - 188,727 (1,607,261) 5,281,000 799,800 305,427 24,609,739 100,000 (158,527) (550,000) 361,800 1,341,473 117,600 4,753,389 584,608 273,095 25,069,745 349,822 1,335,952 78,249 527,611 215,192 32,332 (460,006) 11,978 5,521 39,351 32,816,839 32,444,861 371,978 Capital Construction Capital Purchase 750,000 440,100 (300,000) (100,100) Capital Grants & Transfers Total Capital Expenditure - 1,190,100 - 450,000 340,000 - 790,000 304,764 82,495 869 388,129 145,236 257,505 (869) 401,871 13 Value Added Tax 4,316,700 - 4,316,700 3,820,673 496,027 Total Expenditure 40,350,700 (2,427,161) 37,923,539 36,653,662 1,269,877 24.5 Statement of Losses The Department did not incur any loss of assets during the financial year ending 31/12/07.
Ministry of Lands & Mineral Resources Section 24: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 AUDIT FINDINGS 24.6 Payment of Sky Pacific for Former Interim Minister’s Office The Prime Minister has set the emolument package and other benefits for Ministers in the Interim Government based on the 2003 Parliamentary Emoluments and Benefits Report with some variations.
The guiding principles for the Prime Minister are that this Interim Government and as such Ministers are not entitled to any parliamentary related salary and allowances.

Therefore, the parliamentary salary and constituency allowance have not been included in the package.
As at December 2006, the expense allowance and the optional housing allowance as per the 2003 report are to be paid.1 The Department made payment to Sky Pacific Limited for the installation of Sky Pacific at the former Interim Minister’s Office.

Additional payments were also made for the monthly subscription amounting to $3,025.11 as at 31/12/07.
There was no entitlement for the installation of non free to air channels Sky Pacific as outlined in the 2003 Parliamentary Emoluments and Benefits Report for Ministers.

The above payment was facilitated using allocation from different votes as follows.
Date 25/06/07 Cheque Number 008785 27/09/07 011572 23/10/07 012036 31/12/07 013402 21/02/08 014131 Total Particulars of Sky Pacific for MLMR TV Payment Connections (Installation cost & rentals) Payment for bills for the month of August-Oct07 Payment subscription for Nov 07 Payment of Sky Pacific MLMR from 01/12/07 Payment subscription for Jan –Feb 08 of Sky Pacific of Sky Pacific for Amount $ 991.36 13330179101050801 Allocation Used Allocation Details Other board expenses 825.03 1333017910150499 Training 275.01 13330179101079907 Schedule A Rent 550.02 13330179101040299 Incidentals 550.04 13330179101030401 Telecom 3,191.46 The Department had incurred extravagant expenditure totalling $3,191 which was not budgeted for.
Incurring expenditure without proper allocations and approval is a breach of stipulated procedures and such actions will lead to uneconomical use of public funds and is also tantamount to abuse of office.

Recommendations The Department should provide an explanation for the payments made to Sky Pacific when it was not part of the former Interim Minister’s entitlement.

Management Comments No Comments.


1 Emoluments and other benefits for Ministers in the Interim Government (from Secretary to the Cabinet) dated:12/01/07 Ministry of Lands & Mineral Resources Section 24: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 24.7 Telephone Bills Office telephones should be used for official purposes only.
Official calls should be as brief as possible.2Chief Accounting Officer shall ensure that as far as possible expenditure incurred during each month of the financial year shall not normally exceed the amount forecast.3 Funds allocated for telephone bills were overspent as at 31/12/07.

Refer to details provided.


SEG 3 Allocation ($) 59,400 Actual Expenditure ($) 224,130 Over Expenditure ($) 164,730 Percentage Overspent (%) 277 There is no control over all local and vodafone calls as these can be made directly by staffs from their respective extensions.

The payment of excessive telecom bills was also raised in the 2005 audit report but it appeared that remedial action has not been taken.
Recommendations The Department should have a switch board system whereby all calls are made through a telephone operator to ensure that only official calls are allowed and recovery is made for personal calls made.

 The Department should implement rigid controls on the use of telephones and monitor the duration of calls being made.

Management Comments No Comments.
24.8 Lease Reassessment Not Done Subject to the provisions of any other written law for the time being in force, leases shall be subject to re-assessment of the rent at each tenth year of the term of the lease.4 No later than 12 months before the due date for reassessment of the rent under regulation 10, the Director shall have the land valued by a competent Valuer appointed by him for the purpose of assessing the yearly rental payable until the next due date for reassessment.5 Reassessments were not carried out by the Department for the crown leases on the due dates specified in the lease conditions.
Refer to examples provided.
2 General Order 1113 (a) 3 Finance Instructions 19(3) 4 Section 10 – Crown Lands Act (Cap 132 – Rev.1985) Subsidiary Legislation 5 Ministry of Lands, Alta and Minerals Resources Manual (Procedure and Policies) 1999,pp55-56 Ministry of Lands & Mineral Resources Section 24: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Lessee Issac Ali Jai Raj Daiana Tale Metuisela Cama & Elina Basaga Properties (Fiji) Ltd Fiji Foods Ltd Trust Crown Lease CL 137831 CL 132886 CL 2863 Year Annual Reassessment Rental ($) Due 84.00 1997 37.00 1997 175.00 - CL 160241 140.00 2007 Lease Type Remarks Residential Residential Residential Residential Reassessment not made Reassessment not made Rent reassessed in 2005 to be $335 and not yet effected.
Reassessment not made CL 3390 3,624.00 1996 Industrial Reassessment not made CL 24232 7,000 2004 Industrial Reassessment not made The Department did not comply with requirements of the Act and the Lease Agreement.

This would result in loss of revenue to government as the lessees continued to pay the old rental.

Retrospective rent will also be charged to lessees when reassessment for these crown leases is carried out at a later date.
The charging of retrospective rent as noted in the previous years audit has been continuously disputed by the lessees.

Thus, it results in either loss of government revenue or increase in the crown lease arrears.

Recommendations • Periodic checks and updates should be implemented as a policy to bring lessee information up-to-date to avoid late or reassessment problems.

• Annual file checks should be made to ensure that re-assessment due is noted for the purpose of serving re-assessment notices.
• Reassessments should be carried out when it becomes due for all crown leases administered by the Department.

Management Comments No Comments.

24.9 Charging of Retrospective Rent due to Late Re-assessment Subject to the provisions of any other written law for the time being in force, leases shall be subject to re-assessment of the rent at each tenth year of the term of the lease.6 As from 12/08/93, re-assessment of leases shall be conducted every 5 years.
Once the properties are inspected and rentals re-assessed, the Valuation Clerk prepares and post reassessed notices to the lessee by registered mail.

If there is no response from lessee, 2 reminder notices are sent at a month’s interval.

If the lessee fails to accept rentals after the 2 reminders, the file is sent to the Director of Lands for further advice.7 The audit noted that the Department was charging retrospective rents to lessees.

Refer to examples provided.
6 Section 10 – Crown Lands Act (Cap 132 – Rev.1985) Subsidiary Legislation 7 Ministry of Lands, Alta and Minerals Resources Manual (Procedure and Policies) 1999,pp55-56 Ministry of Lands & Mineral Resources Section 24: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 LD Reference 4/16/7201-2 Term (Years) 99 Annual Rent $(Current) 96,200 Lessee (Type of lease) Fiji and Post Telecommunication Ltd (Commercial) Remarks Lease was entered in 1990 at an annual rental of $32,000 with next re-assessment to be carried out in 2000.
However re-assessment was made in the year 2006 instead of 2000 as agreed and stated in the lease condition.

Arrears totalling $362,377.10 as at 18/03/08 were noted.

Mobil Oil Australia (Foreshore) 4/16/3880 99 38,900 retrospective to be made Lease was entered in 1968, at an annual rental of $ 1,754 with next re-assessment in 1993.However re-assessment was done in 1998 instead of 1993 amounting to $38,900 and was accepted by the lessee on 18/05/98.
Audit noted that rent of the department charged $94,933.33 in 1998 to the lessee due to the late reassessment carried out by the Valuation Section.

Further noted were that the Department was also charging interest on retrospective rent.

Audit noted that there was no provision in the Crown Lease Act or the crown lease policy that permits the charging of interest on retrospective rent.

In addition, charging interest on retrospective rent, which is due to the fault of the department, is not fair to lessees.
rent charged.

Arrears Audit noted that the lessee disputed the above retrospective totalling $51,886.38 as at 18/03/08 were noted in the accounts statement whereas the crown land lease systems reveal that the lessee had arrears of $28,676.38.

Audit noted that the department continues to send notice of arrears dated 06/11/00, 08/10/04, and 16/04/05 amounted to $100,216.82, $240,172.24, and $101,922.07 respectively.
The following anomalies were noted as a result of the department charging retrospective rents.

• There was no provision in the Crown Lease Act or the Department’s Crown Lease Policy that permit the charging of retrospective rent to lessees.

• The charging of the retrospective rents was due to the late reassessments carried out by the Valuation Section or the late updating of the Lands System by the Accounts Section to show the reassessed rent.
• The Department was charging interest on retrospective rent however that there was no provision in the Crown Lease Act or the crown lease policy that permits the charging of interest on retrospective rent.

• Charging of retrospective rent and interest contributed to the increase in arrears of crown lease rental.

• Cases were noted where the lessee disputed the retrospective rents charged, and the department made adjustments in the absence of a formula for retrospective rent in the Crown Lease Act.
This issue was highlighted in the 2005 and 2006 Auditor General’s Report however the department has not been able to address the issue.

Ministry of Lands & Mineral Resources Section 24: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 It indicate the failure of the Department to assess and charge rent on a timely basis resulting in accumulation of rental arrears, write-off and adjustment of rent hence loss of government revenue.
Recommendations • The Department should provide an explanation for the late reassessment and the charging of retrospective rent to lessees.

• The Department should investigate cases of late reassessment and late updating of the Lands System and take disciplinary actions against officers responsible.

• The Department should revise the Crown Lease Act to include provisions for the charging of retrospective rent and interest.
• The cases highlighted above should be investigated and explanations provided for the inconsistent and selective approach adopted by the Department.

Management Comments No Comments.

24.10 Eskay Motors (Fiji) Ltd - CL 013134 Rent shall be due and payable by equal half yearly payments not later than 31 January and 31 July in each year and shall be paid to the Director or to any person authorized in writing by him.
Any rent due from the date of commencement of the lease up to the following 1 July, as the case maybe, shall be added to and paid with such first half yearly payment to be made by the lessee.8 Subject to the provisions of any other written law, leases shall be subject to re-assessment of the rent at each tenth year of the term of the lease.9 As from 12/08/93, re-assessment is conducted every 5 years.
Once the properties are inspected and rentals re-assessed, the valuation Clerk prepares and post reassessed notices to the lessee by registered mail.

If there is no response from lessee, 2 reminder notices are sent at one month’s interval.

If the lessee fails to accept rentals after the 2 reminders, the file is sent to the Director of Lands for further advice.10 Crown lease rent of $42,775 was outstanding for land leased by Eskay Motors (Fiji) Ltd.
The above lease was subject to re-assessment in 2002 as required under the lease agreement.

The rent was re- assessed to $5,300 on 04/12/01 and the lessee was advised accordingly on 01/02/02.

However, audit noted from the Crown Lease Rental System that the department continued to send the account statement of the old rental of $4,300 and the lessee paid accordingly.
A second notice was also issued to the lessee on 21/5/02 to disregard the initial re-assessment notice dated 4/12/01 and to continue paying the old rental of $4,800.

There was no explanation provided in the lease file to support the above action which resulted in loss of revenue totalling $3,500 as at 31/12/07.

8 Section 6(1) - Crown Lands Act [Cap.


132] 9 Section 10 – Crown Lands Act (Cap 132 – Rev.1985) Subsidiary Legislation 10 Ministry of Lands, Alta and Minerals Resources Manual (Procedure and Policies) 1999,pp55-56 Ministry of Lands & Mineral Resources Section 24: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Department has failed to enforce the Crown Lease Act and the requirements of the crown lease agreement on lessees regarding reassessment of rent.
Government interest was also not safeguarded as rent due was not collected.

Recommendations • The Department should provide an explanation on the above findings and provide reasonable explanation for failing to enforce the reassessed rent of $5,300.

• Regular checks should be carried out to ensure that re-assessment of rental is completed and charged to lessees accordingly.

Management Comments No Comments.


24.11 No re-assessment carried out on Crown Lease Subject to the provisions of any other written law, leases shall be subject to re-assessment of the rent at each tenth year of the term of the lease11 .As from 12/08/93, re-assessment is conducted every 5 years.

Once the properties are inspected and rentals re-assessed, the valuation Clerk prepares and post reassessed notices to the lessee by registered mail.
If there is no response from lessee, 2 reminder notices are sent at one month’s interval.

If the lessee fails to accept rentals after the 2 reminders, the file is sent to the Director of Lands for further advice.12 Every year, the System Support Centre generates a list of all re-assessments that are due for the following year.

The list is forwarded to the Valuation Section which then reassesses the rent on the crown lease and sends notices to lessee’s for their consent.
The reassessed rent only becomes effective once the lessee accepts the reassessed rent and all the related documents are formally registered.

Reassessments were not carried out by the Department on certain crown leases on the due dates specified in the lease conditions.

Refer to the following examples.


Lessee CMLA Society Ltd Shashi S Kumar Yong Jin Yun LD Reference Annual Rental ($) 7,400.00 360.00 400.00 4/10/1186 4/10/2786 4/10/2598 Reassessment Due not done 2003 2003 2001 & 2006 Period Lapse as at 31/12/06 5 years 4 years 7 years Section Type Lease of Nadi General Waqadra Waqadra Industrial Residential Residential The department failed to perform its duties as required under the Crown Lease Act and also under the lease agreement.
Recommendations • Annual File checks should be carried regularly to ensure that re-assessment due is carried out in accordance with the requirement of the lease agreement.

• Reassessments should be carried out on time for all crown leases administered by the Department.
11 Section 10 – Crown Lands Act (Cap 132 – Rev.1985) Subsidiary Legislation 12 Ministry of Lands, Alta and Minerals Resources Manual (Procedure and Policies) 1999,pp55-56 Ministry of Lands & Mineral Resources Section 24: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments No Comments.
24.12 Non Compliance with Crown Land Act (Cap 132) Subject to the provisions of any other written law for the time being in force, leases shall be subject to re-assessment of the rent at each tenth year of the term of the lease13 .As from 12/08/93, re-assessment is conducted every 5 years.

Once the properties are inspected and rentals re-assessed, the valuation Clerk prepares and post reassessed notices to the lessee by registered mail.
If there is no response from lessee, 2 reminder notices are sent at one month’s interval.

If the lessee fails to accept rentals after the 2 reminders, the file is sent to the Director of Lands for further advice.14 The following anomalies were noted in the review of the following crown lease files: • CL 12092 - Colonial Life Insurance Society Ltd This lease shall be subject to re-assessment in the years 2001 to a maximum not exceeding 6% of the unimproved value of the land.
15 An industrial lease CL 12092 was issued to Colonial Life Insurance Society Ltd on 1/12/93 with an annual rent of $6,850 per annum.

The rent was re-assessed and reduced to $4,600 effective from 4/2/94.

Audit was not able to establish the reasons for the reduction in rent and how the amount of $4,600 was determined and levied by the department.

The re-assessment of rent that was also due in 2003 was not carried out by the Department.
The above findings would result in loss of government revenue due to reduction in rent to $4,600 and failing to carry out reassessment in 2003 as required.

• CL 12094- Colonial Life Insurance Society Ltd This lease shall be subject to re-assessment in 2003 to a maximum not exceeding 6% of the unimproved value of the land.

16 An industrial lease CL 12094 was issued to Colonial Life Insurance Society Ltd on 1/12/93 at an annual rent of $7,300 and with the subsequent re-assessment of rent to be due in 2003.
A re- assessment was carried out in 2002 amounting to $10,00017 effective 1/12/2003.

Audit investigation revealed the following: • The department levied a rent of $5,000 instead of $7,300 stated in the initial lease agreement resulting in a loss of revenue to government totalling $23,000 within the 10 year period 1993 to 2003.
• Despite the new rent of $10,000 reassessed in 2003, the department continued to levy the rent of $5,000 resulting in loss of revenue to government totalling $20,000 in the last 4 years.
13 Section 10 – Crown Lands Act (Cap 132 – Rev.1985) Subsidiary Legislation 14 Ministry of Lands, Alta and Minerals Resources Manual (Procedure and Policies) 1999,pp55-56 15 Lease Condition for Industrial Lease CL 12092 16 Lease Condition for Industrial Lease CL 12094 17 Re-assessment Notice dated 30/12/02 Ministry of Lands & Mineral Resources Section 24: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The above lot was also subleased by the lessee to Asco Motors for 12 years effective 1/10/93 at an annual rental of $112,500.
The department failed to properly administer crown leases which had resulted in substantial loss of government revenue.

It also shows the laxity of the Department in performing its roles and responsibilities and ensuring that the government gets a fair return from the land.
• CL 13699 - Parveen Kumar 4/10/2597 Rent and rates should be paid up to date and reassessment completed in the process of granting consent to mortgage.18 If the Director of Lands feels that the loan exceeds the market value of the land, consent to mortgage will only be granted subject to satisfactory explanation.19 This lease shall be subject to re-assessment in the years 2001 to a maximum not exceeding 6% of the unimproved value of the land.20 Refer to the table below for details of the crown lease CL 13699.
Lessee Parveen Kumar Crown Lease Ref CL 13699 File Ref No.

Lease Type Term LD 4/10/2597 Residential years with effect 99 01/12/1996 from Annual Rent $(VEP) 500.00 The lease file for CL 13699 revealed the following anomalies: • The re-assessment was not carried out when due in 2001, thus resulting in loss of revenue to government.

• On 24/02/04, the Director of Lands granted consent to mortgage to the lessee for the sum of $700,000 even though the reassessment was not carried out.
Hence, lessees are benefiting at the expense of government not getting a fair return from the land.

• Rental arrears as at 31/12/07 totalled $530.

The above finding shows the poor policing of crown lease by the Department and the inconsistency in the reassessment of rent for residential leases.

It also shows the laxity of the Department in performing its roles and responsibilities and ensuring that the government gets a fair return from state land.
• CL 13858 - Mohammed Gulab Khan 4/10/2647 This lease shall be subject to re-assessment in the years 2001, 2006, 2011 to a maximum not exceeding 6% of the unimproved value of the land.

21 Refer to the table below for details of the crown lease CL 13858 Lessee Mohammed Gulab Khan Crown Lease Ref CL 13858 File Ref No.
Lease Type Term LD 4/10/2647 Commercial years with effect 99 01/12/1996 from Annual Rent $(VEP) 2,700 The following anomalies were noted in the lease file: • The re-assessment due in 2001 was not carried out by the department.

18 Policies- State Land Administration 2.1.1(f)-(i) 19 Policies - State Land Administration 2.1.1(f)-(iv) 20 Lease Condition for Residential Lease CL 13699 21 Lease Condition for Commercial Lease CL 13858.
Ministry of Lands & Mineral Resources Section 24: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The Director of Lands granted consent for the transfer of the above lease to Mohammed Galab Khan on 27/9/02 despite the pending reassessment.

• The Department continued to grant consent to mortgage to the current lessee despite the re- assessment not being undertaken.

Refer below for the details: 1.

2.


Consent to mortgage dated 17/12/02, principal sum $135,000 Consent to mortgage dated 27/09/07, principal sum $550,000 • The rent was finally re-assessed in 2006 to $3,900 however the lessee has not accepted the re- assessed rent despite the issue of the reassessment notice and the additional 21 days notices issued on 02/03/06 and 30/02/06 respectively.
It was established from the Crown Land Lease Systems (CLLS) that the lessee had continues to • pay the rent of $2,700 for the last 7 years.

The loss of government revenue to government for the last 7 years totalled $8,400.

The above finding shows poor policing of crown lease by the Department and also the inconsistency in the reassessment of rent for commercial leases.
It also shows the failure of the Department in performing its roles and responsibilities and enforcing its powers as landlord as stated under the Act to ensure that the government gets a fair return from the land.

The manner in which the transfer was effected and consent granted for transfer and mortgage despite the pending reassessment appear suspicious.
Recommendations • The case highlighted should be investigated and explanations provided for the inconsistent and selective approach adopted by the Department.

• Officers implicated should be disciplined for failing to carry out their duties effectively and complying with the Crown Lands Act; and should also be surcharged the amount of revenue lost by government.

• The Department should ensure that re-assessment carried out should be effected and the reassessed rent charged accordingly.
• The Department should investigate the above findings and provide an explanation why the consent to mortgage was approved when the reassessment was not carried out.

• Re-assessment of rent for all leases administered by the Department should be carried out when it becomes due.

• The officers involved in granting consent to transfer and mortgage despite the pending reassessment should be disciplined.
Management Comments I. CL 12092, LD 4/10/3084 • • • Rental Reassessment was carried out and notice sent on 30/12/02 confirming the rental to be increased from $5,000 per annum to $9,400 per annum with effect from 01/12/03.

However, the lessee did not accept the new rental.

The lessee continued to pay for the old rental ($5,000 per annum) and rental is paid up to 31/12/08.
It is regretted that the rental assessment was not followed up, however, Divisional Surveyor West has been directed to pursue acceptance of new rental by the lessee and payment of outstanding arrears.

II.
II.

CL 12094, LD 4/10/3085 Ministry of Lands & Mineral Resources Section 24: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • • • Rental Reassessment was carried out and notice sent on 30/12/02 confirming the rental to be increased from $5,000 per annum to $10,000 per annum with effect from 01/12/03.

However, the lessee did not accept the new rental.

The lessee continued to pay for the old rental ($5,000 per annum) and the rental is fully paid up to 31/12/08.
It is regretted that the rental assessment was not followed up, however, Divisional Surveyor West has been directed to pursue acceptance of new rental by the lessee and payment of outstanding arrears.

III.

CL 13699, LD 4/10/2597 • • Rental Reassessment was carried out and notice sent on 30/12/02 confirming the rental to be increased from $400 per annum to $750 per annum with effect from 01/12/06.

Lessee has accepted the new rental.


Currently there is a rent arrears of $750 to 31/12/08 and Divisional Surveyor West will pursue payment.

IV.

CL 13858, LD 4/10/2647 • • Rental Reassessment was carried out and notice sent on 22/11/05 confirming the rental to be increased from $2,700 per annum to $3,900 per annum with effect from 01/12/06.

Despite of two reminders the lessee still reluctant to accept new rental.
Our valuers in the Western Division are still negotiating with the lessee and they have been directed to finalise the rent assessment.

DEPARTMENT OF MINERAL RESOURCES - FINANCIAL STATEMENT 24.13 Audit Opinion The audit of the 2007 accounts of the Department resulted in the issue of a qualified audit report.

The qualifications are as follows.


• The Department did not provide the following statements contrary to section 82 (1) of the Finance Instructions: Appropriation Statement; Statement of Losses; and Trust Account Statement of Receipts and Payments.
The Financial Management Information System shows that the Department of Mineral Resources as at 31/12/07 has an Operating Trust Fund Account balance of $19,378 and main trust fund totalling $719,090 • The amounts in the Statement of Output costs are estimates as the facility to allow measurements and accounting of costs are yet to be integrated in the Financial Management Information Systems (FMIS) of Government.
It is not possible therefore to determine the accuracy of the expenditures incurred by the Ministry under the two outputs.

• There is a variance between the VAT records and the accounts as at 31/12/07.

Ministry of Lands & Mineral Resources Section 24: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 24.14 Statement of Receipts and Expenditure The Department incurred a total expenditure of $5,746,337 in 2007 compared to $3,696,949 in 2006.
Description RECEIPTS Mining Fees License Others Sale of Photographs Sales of Publications Revenue from Chemical TOTAL REVENUE EXPENDITURES Operating Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Capital Construction Capital Purchase Total Capital Expenditure 2007 $ 76,793 23,059 71 333 10,591 110,847 1,594,597 337,450 79,648 2,585,750 137,371 381,529 20,151 5,136,496 2006 $ 2,158 - - - 6,849 9,007 1,653,566 327,682 120,492 254,634 137,580 357,125 22,270 2,873,349 124,849 113,619 238,468 226,828 204,374 431,202 Value Added Tax 371,373 392,398 TOTAL EXPENDITURE 5,746,337 3,696,949 24.15 Statement of Output Costs The Statement of Output Costs consolidates the 3 outputs prescribed in the Budget Estimates.
These are detailed in the Appendix 24.2 AUDIT FINDINGS 24.16 Payment of Overtime without Budgetary Allocation Compliance of the overtime rules should be strictly adhered to and overtime work should be approved only in essential circumstances by the Permanent Secretary or Head of Department.22 Overtime should only be worked once approval is secured from the Permanent Secretary.
Overtime approval should be considered if overtime request confirms that the work in question is important and very urgent in nature, which requires immediate attention.23 22 General Orders S467/ PSC Circular No.

1/95 23 PSC Circular No.

11/04 dated 31/03/04.


Ministry of Lands & Mineral Resources Section 24: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Department paid a total of $12,752 for overtime that was approved by the Assistant Director although there was no budgetary allocation.

There was also no evidence that the Public Service Commissions had approved the payment of overtime.

Refer the following for details.
Name of Officer Post Joseva W Raika Clerical Officer Waisea Kotoyawa TRCO Mere Tuinaceva Clerical Officer TRCO Peniasi Toga Meresiana Loulou Clerical Officer Clerical Officer Iliesa Bacita Total Reference & Date 11217 of 31/12/07 11224 of 31/12/07 11218 of 31/12/07 11219 of 31/12/07 11225 of 31/12/07 11221 of 31/12/07 11222 of 31/12/07 11223 of 31/12/07 Amount Paid ($) Remarks 4,029.40 Overtime for 2006 3,090.66 Overtime for 2007 1,061.43 Overtime for 2006 and 2007 1,190.11 Overtime for 2006 798.96 1,085.25 Overtime for 2006 and 2007 1,294.49 Overtime for 2006 and 2007 201.65 Overtime for 2005 12,751.95 Expenditure was not properly controlled by the Department and as a result unauthorised overtime payments were made to staff.
Recommendations All overtime work should be approved.

Management Comments No Comments.

24.17 Engagement of Consultant without Signed Agreement Engaging of consultants is essentially a contracting for service.

A formal contract must be prepared clearly outlining the terms and conditions of the engagement.
The contract formulation are made at the Ministries/Departments’ own discretion.24 Following a Cabinet Meeting on 03/04/07 and under powers vested with the Minister of Lands and Minerals Resources, Mr Filimone Raibosa was appointed as an independent mining consultant.

The Public Service Commission approved his appointment on 19/6/07 to consult and advise the government on all engineering and operational aspects pertaining to the termination of Emperor Gold Mining Company Limited operations in Fiji.
The approval was conditional upon the terms and conditions on the agreement to be signed between the former Interim Minister for Lands and Mineral Resources Mr Tevita Vuibau and Mr Raibosa.
The following irregularities were noted: • • • no agreement was signed between the Minister of Lands and Minerals Resources and Mr Filimone Raibosa as required by PSC; a sum of $10,000 was paid to Mr Raibosa on 23/7/07 without a signed agreement authorised by the acting Assistant Director Minerals Resources Department, Mr Vijendra Prasad; the Consultant was to produce a report before any payment is made.

24 PSC Circular No.
24 PSC Circular No.

23/2001 Ministry of Lands & Mineral Resources Section 24: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Department did not act according to the condition set by PSC and as a consequence, an unauthorised payment of $10,000 was made.

In the absence of an agreement, the consultant is at no obligation to complete the required tasks and there is a risk that further costs could be incurred by the Department.
Recommendations • An agreement should be drafted and signed by both parties as soon as practical.

• No further payment should be made until an agreement is in place.

• The officer responsible for the above payment should be disciplined.

Management Comments No Comments.
Ministry of Lands & Mineral Resources Section 24: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 24.1: Statement of Output Costs – Lands Department Policy and Administration SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Total Expenditure Administration SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Total Expenditure 2007 $ 262,281 21,172 23,016 16,365 8,531 - - 331,365 - - - - 1,610,915 1,942,279 2007 $ 1,039,337 86,140 131,329 24,820,092 334,082 1,335,952 78,242 27,825,173 - - - - 1,493,081 29,318,254 Ministry of Lands & Mineral Resources Section 24: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Survey & Mapping SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure
 Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Total Expenditure Valuation SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Total Expenditure 2007 $
 2,447,964 420,735 86,375 192,991 4,762 - 8 3,152,835 269,629 82,495 869 352,994 400,347 3,906,175 2007 $ 689,627 18,910 23,509 17,888 2,273 - - 752,208 - - - - 109,180 861,387 Ministry of Lands & Mineral Resources Section 24: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 State Land Operation and Development SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Total Expenditure Geological and Mineral Investigation SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Expenditure 2007 $ 314,181 37,651 8,866 22,409 174 - - 383,281 35,135 - - 35,135 207,151 625,566 2007 $ 1,400,938 337,450 74,407 2,578,789 57,051 381,529 20,151 4,850,315 124,849 113,619 0 238,468 356,148 5,444,931 Ministry of Lands & Mineral Resources Section 24: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Oil and Mines Act Administration SEG
 Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Total Expenditure 2007 $ 193,659 0 5,241 6,961 80,321 0 0 286,181 0 0 0 0 15,225 301,407 Ministry of Lands & Mineral Resources Section 24: Page 20 REPORT OF THE AUDITOR GENERAL OF
 THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 25 Ministry Investment and Communication Commerce, of Industry, Programme Statement The Ministry of Commerce, Industry, Investment and Communication comprises of the following Departments: • Commerce and Industry; • Co-operatives and Small Business • Communication The Ministry is responsible for formulating and implementing policies and strategies to facilitate investment, commerce and business development thus contributing to quality economic growth.
The development and implementation of policies and strategies involves the Economic Analysis Unit working closely with the implementing arms of the Ministry which are: Department of Fair Trading and Consumer Affairs; Corporate Section; National Micro Finance Unit; Consumer Council of Fiji; Fiji Islands Trade and Investment Board; Fiji Audio Visual Commission; National Centre for Small and Micro Enterprise Development; and Department of Cooperatives and Small Business.
The Ministry is also responsible for providing and implementing Government policies on the regulation of the Telecommunication, ICT, Radio Communications, Postal and Television Industries.
Table of Contents 25.7 25.8 25.9 25.1 25.2 25.3 25.4 25.5 25.6 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion .................................................................................................................. 2 Statement of Receipts and Expenditure .......................................................................... 2 Statement of Output Costs.............................................................................................. 3 Appropriation Statement ................................................................................................. 3 Statement of Losses ....................................................................................................... 4 TMA Annual Financial Statements .................................................................................. 4 AUDIT FINDINGS ................................................................................................................................. 5 Submission of Incomplete Financial Statements ............................................................. 5 Statement of Output Cost................................................................................................ 5 FNPF Reconciliation ....................................................................................................... 6 DEPARTMENT OF COMMERCE AND INDUSTRY
 .............................................................................. 6 Review of the Performance of the Government Handicraft Centre.................................. 6 DEPARTMENT OF COOPERATIVES................................................................................................... 7 Arrears of Revenue ......................................................................................................... 7 Revolving Fund Account – Miscellaneous....................................................................... 8 Lending Fund Account .................................................................................................... 9 DEPARTMENT OF COMMUNICATION .............................................................................................. 10 Expired Licences........................................................................................................... 10 25.14 25.15 Arrears of Revenue ....................................................................................................... 11 Appendix 25.1 – Statement of Output Costs ................................................................................. 13 Appendix 25.2 Reconciliation of FNPF.......................................................................................... 16 25.11 25.12 25.13 25.10 Ministry of Commerce, Industry, Investment and Communication Section 25: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER
 2008 FINANCIAL STATEMENT 25.1 Audit Opinion The audit of the 2007 accounts of the Ministry of Commerce, Industry, Investment and Communication resulted in the issue of a qualified audit report.
The accounts were qualified on these grounds.

a) b) The Ministry had consolidated its expenditures into 5 Statement of Output Costs whereas the Budget Estimates 2007 prescribes 13 outputs.

The facility to allow the measurement and accounting of output costs has yet to be integrated in the Financial Management Information System (FMIS).

It is not possible therefore to express an opinion on the accuracy of the expenditures incurred by the Office under each output.
The Ministry has not provided accounts for Trust Account Statement of Receipts and Payments in accordance with section 82(1) of the Finance Instruction.

The Finance Management Information Systems shows a sum of $31,345 as at 31 December 2007.

25.2 Statement of Receipts and Expenditure The Ministry incurred a total expenditure of $13,333,530 in 2007 compared to $10,900,338 in 2006.
Table 25.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Fees – Miscellaneous License Trading License Telecom & TV Commission Value Added Tax Registration Interest on Consumer Loans Refund Government Miscellaneous TOTAL REVENUE EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers 2007 $ 2006 $ Ministry of Commerce, Industry, Investment and Communication Section 25: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 3,257,025 11,449,804 0 172,562 820,015 992,577 2006 $ 1,140,918 9,187,973 0 44,400 1,040,000 1,084,400 Value Added Tax 891,149 627,965 TOTAL EXPENDITURES 13,333,530 10,900,338 25.3 Statement of Output Costs The 5 Statements of Output Costs are detailed in Appendix 25.1.
25.4 Appropriation Statement The Ministry incurred expenditures totalling $13,333,530 in 2007 against the budget of $16,639,100 resulting in a savings of $1,428,363 or 8.6%.

Details of expenditures against the budget estimates are provided in the table below.
Table 25.2: Appropriation Statement for 2007 Actual Expenditure $ Carry – Over $ Lapsed Appropriation $ SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants and Transfers Total Capital Expenditure 13 Value Added Tax Budget Estimate $ 3,136,600 303,900 199,700 315,900 106,400 4,349,400 4,337,100 12,749,000 1,000,000 191,300 1,500,000 2,691,300 1,198,800 Changes $ 9,951 4,496 1,400 37,600 (16,500) 16,654 (53,601) 0 Revised Estimate $ TOTAL EXPENDITURE 16,639,100 0 16,639,100 13,333,530.26 A total of $70,101 was transferred between the standard expenditure groups (SEGs) in 2007.
0 0 0 0 0 0 0 0 0 0 0 0 0 0 140,074.72 8,007.28 17,230.44 41,336.30 45,173.98 20,899.31 1,026,473.68 1,299,195.71 1,000,000 18,738.14 679,985.00 1,698,723.14 307,650.89 3,305,569.74 Ministry of Commerce, Industry, Investment and Communication Section 25: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 25.5 Statement of Losses 1) A DVD player valued at $169 was reported missing by the Senior Co-operative Officer-Training on 13/11/07 but a loss report was not prepared.
The staffs of the Department bought a replacement.

2) A laser printer valued at $389 was approved for write off by the Permanent Secretary for Finance as it was unserviceable.

3) The Nadi office vehicle no.

GK220 valued at $13,000 was approved for write off by the Minister for Finance.
25.6 TMA Annual Financial Statements Table 25.3: Trading & Manufacturing Account - Government Handicraft Centre Manufacturing Account Raw Materials (1/1/07) Purchases Raw Materials (31/12/07) Raw Materials Used Add Work in Progress (1/1/07) Direct Costs Direct Labour Indirect Costs Factory Overheads Indirect Labour Less Work in Progress (31/12/07) Cost of manufactured goods transferred to Trading Account Trading Account Sales Stock of Finished Goods (1/1/07) Add Cost of Manufactured Goods transferred from Manufacturing Account Less Stock of Finished Goods (31/12/07) Cost of Finished Goods Sold Gross Profit Transferred to P&L Profit & Loss Statement Income Gross Profit transferred from Trading A/c Other Income Total Income Expenses 2007 $ 2006 $ Ministry of Commerce, Industry, Investment and Communication Section 25: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Manufacturing Account Travel Domestic Communication Vat Input Tax Total Expenses Net Profit for the year AUDIT FINDINGS 2007 $ 2006 $ 269 1,507 668 2,444 6,942 0 1,669 1,605 3,274 7,907 25.7 Submission of Incomplete Financial Statements Finance Instructions 81(3) provides that the draft financial statements must be submitted to the Auditor General by 31 March in the following year, or within such other time as
 agreed with the Auditor General.
Each agency must include the following statements in its annual financial statements:1 a.)

b.)
c.) d.) e.) f.) g.) h.) a statement of receipts and expenditure; statement of output costs; a profit and loss statement for each trading and manufacturing activity; an appropriation statement; a statement of assets and liabilities; notes to the statement of assets and liabilities; a statement of losses; a trust account statement of receipts and payments (where applicable) The 2007 draft financial statements submitted by the Ministry for audit did not include the trust statement of receipts and payments.
Recommendation The Ministry should ensure that all the required statements are submitted for audit.

Ministry’s Comments As informed earlier, the statements issued are the financial statements authorized by the Ministry of Finance in respect of our Ministry.

The reports submitted are the only reports developed by the FMIS to date.
As for the format, these reports were printed for us by the Ministry of Finance so they are expected to be within the guidelines of the Manual 25.8 Statement of Output Cost The 2007 budget estimates of the Ministry of Commerce, Industry, Investment and Communication prescribes 13 outputs.

The financial statement submitted for audit consolidated its expenditures into five statements of output costs.
1 Finance Instruction 82(1) Ministry of Commerce, Industry, Investment and Communication Section 25: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation The Ministry should prepare 13 statements of output costs as specified in the budget estimates.
Ministry’s Comments The five core outputs for the Ministry as outlined in the Portfolio Performance Statement are as follows: 1.Portfolio Leadership Policy Advice 2.Licensing, Compliances and Monitoring 3.Export and Investment Promotion 4.Education, Training – Small Business Management 5.Provision of Infrastructure – Telecommunication and Postal Services to Remote Areas.

Outputs 1 and 2 above are common to all programs and that is now a total of 13 outputs have been identified.
The output costing was submitted and approved by the Budget Division of the Ministry of Finance.

The financial statements are linked to the 5 core outputs for 2007.

25.9 FNPF Reconciliation A reconciliation of FNPF revealed that FNPF may have not been paid in respect of salaries and wages totalling $100,906.

Refer to Appendix 25.2 for details.

Recommendation The Ministry should provide explanations for the FNPF not paid on salaries and wages totalling $100,906.
Ministry’s Comments FNPF reconciliations are done every month with the payrolls before the payment to the FNPF Board.

The payments have to match with the salary/wages deductions for the particular month.

Your high level reconciliation did not take into account that FNPF is deducted on gross earnings of salary and wage only excluding allowances.

The figures you have quoted includes payment of various allowances with salaries and wages to officers which are not subject to FNPF.
Please also note that we have a number of project staff whose employers share of FNPF contributions are charged to the project budget although salaries are initially charged to the Personal Emolument allocations.

Apart from above there is no discrepancies in reconciliations of FNPF with the Payroll.
DEPARTMENT OF COMMERCE AND INDUSTRY 25.10 Review of the Performance of the Government Handicraft Centre Trading & Manufacturing Accounts were created to provide goods and services that are needed to other government departments and also to the private sector when possible.
However it is required that TMAs should break even to ensure that all costs incurred in its operations are recouped.2 The Government Handicraft Centre (GHC) has been in existence since 1974 with the objective to encourage the production of traditional handicraft as a means of creating income, employment and 2 Finance Circular 37 dated 26/11/84 Ministry of Commerce, Industry, Investment and Communication Section 25: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 stimulating business opportunities in the rural areas.
For the past 10 years, GHC has concentrated mainly on selling handicrafts from its centre in Suva.

The Government Handicraft Centre operates a trading and manufacturing account and has been incurring losses for the last 7 years.

Refer table for details.


Table 25.4: Losses - GHC Year 2001 2002 2003 2004 2005 2006 2007 Loss ($) 66,889.00 70,530.57 68,854.93 71,622.93 71,907.07 74,779.93 72,469.09 With sales of only $9,922 in 2007, the activity cannot be viable given that rent alone is $30,000 annually apart from other operational costs, including wages of 4 employees.

Recommendation The Ministry should seriously consider closing the Government Handicraft Centre because it is commercially not viable as a business operation.
Ministry’s Comments A cabinet paper for the review of the Government Handicraft Centre has already been submitted to the Cabinet and we are awaiting directive for the ‘Way Forward’ for the centre.

DEPARTMENT OF COOPERATIVES 25.11 Arrears of Revenue Arrears of Revenue - Interest on Consumer Loan Scheme Arrears of revenue (interest on Consumer Loan Scheme) as at 31 December 2007 increased by $2,657 or 4.5% compared to 2006.
Ministry of Commerce, Industry, Investment and Communication Section 25: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Arrears of Revenue Year 2003 2004 2005 2006 2007 Balance $ 162,842 54,711 57,890 59,647 62,304 ) $ ( t n u o m A 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 2003 2004 2005 Year 2006 2007 Efforts made by the Department of Cooperative to recover its debts proved futile as most of these co- operative societies have liquidated.
This resulted in the rise of arrears of revenue (principal and interest) to $166,479 as at 31/12/07 of which $163,497 or 98% has remained uncollected for more than 5 years.
The details of arrears of revenue are shown in the table below Table 25.5: Arrears of Revenue Age of Arrears 0 – 2 Years 2 – 5 Years Over 5 Years Total Principal Balance $ 0.00 2,570.00 101,605.92 104,175.92 Interest $ 0.00 462.60 61,841.22 62,303.82 Total Owing $ 0.00 3032.60 163,497.14 166,479.74 Percentage Owing % 0.00 1.8 98.2 100.0 Recommendations • • Concerted efforts should be taken to collect the arrears of revenue.
The Department of Cooperative should review its debt recovery and lending procedures.

Ministry’s Comments The overdue loans are owned by co-ops that have ceased to operate 5 years ago and beyond.

For these amounts to be written off, the Department of Co-operative will need to identify savings from its annual budget allocation to effectively write off the delinquent loans.
Until savings are identified, the total amount outstanding will continue to increase annually because of the additional annual interest charged.

Todate the Department has not been able to create any savings from its annual budget allocation to offset the delinquent loans.

As recommended, the Department will review very shortly the operation of it’s lending fund account.

25.12 Revolving Fund Account – Miscellaneous The Revolving Fund Account Miscellaneous shows a balance of $21,257 as at 31 December 2007.
The amount comprise of payments made by Ministry of Finance regarding a court decision in 2002 against Ramesh Chand, a Senior Assistant Cooperative Officer who was found guilty of contributory negligence.

Mr. Ramesh Chand was driving the government vehicle GM 332 on 30/05/01, when he was involved in an accident.
Ministry of Commerce, Industry, Investment and Communication Section 25: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Department was ordered to pay a sum of $83,030 after a High Court Civil Action No.

88 of 2002 ruled against the driver of the government vehicle, Mr. Chand for contributory negligence.

The Ministry of Finance paid a sum of $66,273 on behalf of the Department being 75% of the total judgement fees to the plaintiff in 2005.
An appeal was later lodged by the plaintiff on the amount paid to him.

The court ruled in his favour and the Ministry of Finance paid the remaining balance and other legal costs amounting to $21,257 in 2007.

Recommendation The Department should recover the amount from the driver.

Ministry’s Comments The case regarding negligence by Mr Ramesh Chand is being handled by MOF who is in possession of all the relevant documents and they shall lay charges upon him through the normal process.
They shall accordingly inform us of the charges that will be imposed upon the officer.

25.13 Lending Fund Account Lending Fund established by the Government in 1973 to fund low interest, short term borrowing by the consumer co-operatives.

The balance consists of irrecoverable funds.


Lending Fund Account Year 2003 2004 2005 2006 2007 Balance $ 110,386 115,926 112,070 109,926 109,111 ) $ ( t n u o m A 118,000 116,000 114,000 112,000 110,000 108,000 106,000 104,000 2003 2004 2005 Year 2006 2007 There was a decrease in the outstanding loans balance in 2007 under the Lending Fund Account by $815 or 0.74% compared to 2006 due to the repayment of loans by some cooperatives during the year.
Recommendation Efforts should be made to collect the arrears of revenue.

Ministry’s Comments The Department does send reminders to the supervising officers of co-operatives that have loans under the above.

They do undertake their yearly annual audit tour to the rural and outer islands from July to November.

Reminder letters have been issued to them.
Ministry of Commerce, Industry, Investment and Communication Section 25: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DEPARTMENT OF COMMUNICATION 25.14 Expired Licences A licence granted shall be in writing and, unless previously revoked in accordance with any term contained in the license, shall continue in force for such period as may be specified under the licence.3 The fee payable for any licence shall be the fee for the full licensing year which shall be deemed to commence on the first day of January.4 A person who dishonestly obtains a service by means of a telecommunication system licensed under the Telecommunications Act with intent to avoid payment of any charge applicable to the provision of that service shall be guilty of an offence and liable to imprisonment for a term not exceeding one year or a fine not exceeding one thousand dollars, or both.5 All communication license issued by the Department are valid for one year and renewed annually upon payment of the license fee as specified in the licence agreement by the licence holder.
Numerous telecommunication licence holders had not renewed their annual licence with the payment of the required fees.

Audit noted that the license holders continued to provide the communication services, contrary to section 30 of the Telecommunication Act.

Refer to the table below for examples.


Table 25.6: Examples of Licence Holders Operating Without Renewing their Licence Licence Holder Gizzmo Phones of Type Licence Radio Dealers Licence Approval Date 25/09/01 Annual Fees $ 562.50 (VEP) Integral Multimedia & Communications ISP licence 01/12/00 1100.00 (VEP) Arrears $ 2,317.52 3,375.00 Comments Annual License Fee not paid and license not renewed by the Department.

Annual License Fee not paid and license not renewed by the Department.
The license holders continued to provide communication services despite non-payment of license fees.

Recommendation The Department should immediately revoke the licenses that are in arrears.

Ministry’s Comments Immediate revocations of licenses which are in arrears are seriously being considered by the Department and have been noted with priority.

 The Department has also noted that legal actions against illegal operators should be pursued as recommended.
However, considering the small magnitude of license fees owed to Government by some license holders, it would be uneconomical for the Government to take legal actions against such licensees.

 The Department is now reviewing the license agreements to include the recommended provision (“license would be revoked upon nonpayment of license when due”) in all the licenses that will be issued to the public.
3 Telecommunications Act Chap 173, [section 7(2)] 4 Telecommunications Act Chap 173, [section 91] 5 Telecommunications Act Chap 173, [section 30] Ministry of Commerce, Industry, Investment and Communication Section 25: Page 10 is company The still operating but is struggling to make full payment of the total amount due.

They have promised two to payments until third quarter of 2008.
The responding calls and reminders not is telephone company to do REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Licence Holders Type of Licence Approval Date Gizzmo Phones Radio Licence Dealers 25/09/01 Annual Fees $ 562.50 (VEP) Arrears $ Comments 2,317.52 Integral Multimedia & Communications ISP licence 01/12/00 1100.00 (VEP) 3,375.00 25.15 Arrears of Revenue Chief Accounting Officers are personally responsible for the prompt collection of all revenue under their control and for the prompt submission of bills in respect of services rendered by the Government.6 Recovery of revenue should not be waived and the responsible officer is held liable if revenue has become irrecoverable through delay in enforcing payment.7 The arrears of revenue of telecommunication fee as at 31/12/07 totalled $97,918.
A five year analysis is shown in the table below.

Arrears of Revenue - Communication Year 2003 2004 2005 2006 2007 Balance $ 0 610,802 477,348 123,651 97,918 ) $ ( t n u o m A 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 Arrears of Revenue 2003 2004 2005 Year 2006 2007 The arrears accumulated over the years as a result of the inability of the license holders to pay their license fees when due.
Recommendation The Department should ensure that stringent measures are put in place for the prompt recovery of outstanding telecommunication license fees.

Ministry’s Comments Recommendations by the Auditor General has been noted by the Department of Communications, and shall pursue necessary actions for stringent debt recovery procedures to be put in place to recover outstanding arrears and identify those to be recommended for deletion.
6 Finance Instruction 114 7 Finance Instruction 123(2) Ministry of Commerce, Industry, Investment and Communication Section 25: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 We reply to the audit queries being made against the Department of Communication on the subject of Debt Collection Mechanism, and we hereby elaborate on significantly important issues which should also be considered by the Office of the Auditor General.
The Scope of Work and the Officers within the Department: The Department of Communication is made up of: Officers with technically oriented backgrounds Accounts Officer Secretaries Driver TOTAL NUMBER OF PERSONNEL - - - 6 - 2 - 10 1 1 It should be noted that the core business of the Department is focused on technical and administrative issues in its role as the Regulator of the Telecommunications Industry in Fiji.
Evidently therefore 60% of our staffs are technical personnel who merely have very little knowledge in basic accounting.

 The above number of personnel (6 Officers) is the very people that are involved in Debt Collection activities.
There is no clear definition on the exact role of the Accounts Officer within the Department and that the Senior Engineer and the three (3) Technical Officers mentioned above had been expected to include in their position descriptions certain accounting activities which are inclusive of debt collections and other related accounting tasks.

 The total number of Stations recorded by the Department is 9203.
To revalidate a station it has to be inspected by our radio inspectors who physically go out to visit those stations.

With the limited number of personnel available in the Department, we could only inspect those stations randomly which are accessible by roads or by boat and are closer to the major urban centres.

This is done within the limits of our budgeted provisions allocated for such activity.
The various types of radio services, monitoring of revenue collections and arrears of revenue are distributed between the Senior Engineer and three (3) Technical Officers Invoices are prepared and sent to debtors in December.

Reminders are then sent in January to those that have failed to respond to the first invoice that was sent in December.

Collection of fees resumes immediately as debtors responded to invoices and reminders being sent.
Monthly & Quarterly Reports on revenue collected.

 Monthly and Quarterly Reports on outstanding arrears.

 Other technical reports on technical matters concerning the Telecommunications industry in Fiji.

In view of the above we therefore draw your attention to the above constraints that currently exist within the Department of Communications.
Ministry of Commerce, Industry, Investment and Communication Section 25: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 25.1 – Statement of Output Costs General Administration 2007 2007 ($) 2006 ($) EXPENDITURE Operating Costs Established staff Government Wage Earners Travel and communications Maintenance & operations Purchase of goods and services Operating grants and transfers Special expenditures Total Operating Costs Capital Expenditure Construction Purchases Grants and Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE Economic Analysis Unit 2007 EXPENDITURE Operating Costs Established staff Unestablished staff Travel and communications Maintenance & operations Purchase of goods and services Operating grants and transfers Special expenditures Total Operating Costs Capital Expenditure Construction Purchases 449,234 97,467 59,668 101,490 11,590 4,203,752 0 4,923,201 0 0 320,015 320,015 90,836 5,334,052 2007 ($) 2006 ($) Ministry of Commerce, Industry, Investment and Communication Section 25: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Grants and Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE Fair Trading 2007 EXPENDITURE Operating Costs Established
 staff Unestablished staff Travel and communications Maintenance & operations Purchase of goods and services Operating grants and transfers Special expenditures Total Operating Costs Capital Expenditure Construction Purchases Grants and Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE Cooperatives 2007 EXPENDITURE Operating Costs Established staff Unestablished staff Travel and communications Maintenance & operations Purchase of goods and services Operating grants and transfers Special
 expenditures 2007 ($) 2006 ($) 0 0 416,761 3,832,001 0 0 210,108 1,604,667 2007 ($) 2006 ($) 499,644 49,505 26,939 96,029 1,343 0 135,452 808,912 0 152,095 0 152,095 113,541 1,074,548 540,723 51,729 27,997 96,023 1,580 0 91,727 809,779 0 0 0 0 94,524 904,303 2007 ($) 2006 ($) 1,479,788 1,558,425 89,202 66,072 78,966 18,754 0 0 86,467 75,131 75,222 12,154 0 0 Ministry of Commerce, Industry, Investment and Communication Section 25: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Total Operating Costs Capital Expenditure Construction Purchases Grants and Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE Communication 2007 EXPENDITURE Operating Costs Established staff Unestablished staff Travel and communications Maintenance & operations Purchase of goods and services Operating grants and transfers Special expenditures Total Operating Costs Capital Expenditure Construction Purchases Grants and Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE 2007 ($) 2006 ($) 1,732,782 1,807,399 0 20,467 0 20,467 217,098 1,970,347 0 0 0 0 222,925 2,030,324 2007 ($) 2006 ($) 266,800 9,629 23,663 17,338 10,318 141,403 100,517 569,667 0 0 500,000 500,000 52,913 1,122,580 264,660 8,274 22,677 16,582 8,165 156,261 0 476,618 0 0 0 0 33,321 509,940 Ministry of Commerce, Industry, Investment and Communication Section 25: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008
 Appendix 25.2 Reconciliation of FNPF a.)
Total FNPF against salaries and wages for 2007: Total FNPF against salaries and wages returns for 2007: FNPF as per financial statements $ 240,459 Add: December 2007 FNPF (42,453/2) Less: December 2006 FNPF (48,891/2) FNPF for 2007 21,227 261,686 (24,446) 237,240 Gross Pay subject to FNPF [237,240 divided by 0.08] 2,965,500 b.)
Salaries and Wages for 2007 subject to FNPF: Salaries, Wages and Allowance as per financial statements 3,066,406 Difference (100,906) Ministry of Commerce, Industry, Investment and Communication Section 25: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 26 Ministry of Transport, Works and Energy Programme Statement The Ministry of Transport, Works and Energy comprises of the following Departments: • Civil Aviation • Transport Planning Unit • Government Shipping Services • Meteorological Service • Fiji Islands Maritime Safety Administration; • Public Works Department – Common Services; and • Department of National Roads.
The purpose of the Ministry of Transport, Works and Energy is to provide policy, planning, coordination, design, construction, operation, maintenance and management of programmes or activities related to public buildings, mechanical and electrical services, roads, bridges, airfields and jetties.

Also, the Ministry is responsible for any policy and administrative support services to Government, Transport Statutory Authorities, the Private Sector and public at large.
This will enable facilitation of an efficient and sustainable transportation system and Meteorological Services within the country.
the enhancement and Table of Contents 26.1 FINANCIAL STATEMENTS................................................................................................................... 2 AUDIT FINDINGS ................................................................................................................................. 3 DEPARTMENT OF METEOROLOGICAL SERVICES .......................................................................... 3 Sub-letting of quarters by Department’s Staff............................................................... 3 AUDIT FINDINGS ................................................................................................................................. 4 FIJI ISLANDS MARITIME AND SAFETY ADMINISTRATION ............................................................... 4 26.2 Overpayment of telephone rentals ............................................................................... 4 Long Outstanding Arrears of Revenue......................................................................... 5 26.3 GOVERNMENT SHIPPING SERVICES................................................................................................ 6 Vessel fuel used for fuelling motor vehicles ................................................................. 6 26.4 26.5 No Credit Note/Refund for Drum Deposits ................................................................... 8 In-operative Vessel - Adi Cagi ni Toba......................................................................... 9 26.6 AUDIT
9 26.6 AUDIT FINDINGS – DEPARTMENT OF ROADS................................................................................ 10 HEADQUARTERS .............................................................................................................................. 10 26.7 Anomalies in expatriate staff contract agreements..................................................... 10 26.8 Road Safety Management Workshop in Australia...................................................... 12 26.9 ROMDAS conference in India .................................................................................... 13 26.10 Death Compensation Claim ....................................................................................... 15 DIVISIONAL ENGINEER ROADS CENTRAL EASTERN.................................................................... 16 26.11 TMA profitability and operations – Nasinu Quarry & Starmix ..................................... 16 DIVISIONAL ENGINEER ROADS WESTERN .................................................................................... 18 26.12 Trading and Manufacturing Account (TMA) ............................................................... 18 Section 26: Page 1 Ministry of Transport, Works & Energy REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 26.12.1 Profitability and Investment in TMA Operations ....................................................18 26.12.2 Performance of Lomolomo
 Crusher.........................................................................20 26.13 Stolen Premix from Fuel Room .................................................................................. 21 26.14 Contractor in Default .................................................................................................. 21 26.15 Overtime for Unofficial Purpose ................................................................................. 22 26.16 Vehicle Accident ........................................................................................................ 24 AUDIT FINDINGS – DEPARTMENT OF WORKS AND MECHANICAL .............................................. 25 CHIEF ENGINEER MECHANICAL SECTION..................................................................................... 25 26.17 Trading and Manufacturing account........................................................................... 25 26.17.1 Overall Financial Performance of CEME TMA......................................................25 26.18 Plant Hire TMA .......................................................................................................... 26 26.18.1 Replaceable Government Vehicle ............................................................................26 26.18.2 “Idle” Plants and Vehicles incurring Oil, Fuel and Maintenance Costs ...............26 26.18.3 Government Vehicle and Plants Generating Losses ...............................................27 “Idle” Vehicles
“Idle” Vehicles and Plants.......................................................................................28 26.18.4 26.19 Overspending – Electrical .......................................................................................... 29 DIVISIONAL ENGINEER WESTERN.................................................................................................. 30 26.20 Plant Hire ................................................................................................................... 30 26.20.1 Uneconomical Plants and Vehicles..........................................................................30 26.20.2 Expired certificate of road worthiness.....................................................................31 26.20.3 Vehicles under Repair but incurring High costs of Fuel and Oil ...........................32 26.21 Quarters - Rent Deduction Not Effected..................................................................... 34 26.22 Accident committee’s recommendation not carried out effectively ............................. 35 DIVISIONAL ENGINEER EASTERN................................................................................................... 36 26.23 TMA Business Plan Not Prepared ............................................................................. 36 DIVISIONAL ENGINEER NORTHERN ............................................................................................... 37 26.24 Trading and Manufacturing Account
 Anomalies......................................................... 37 26.24.1 Unutilised Stocks – Plumber shop TMA ..................................................................37 26.24.2 Arrears of Revenue – Electricity Charges ...............................................................37 Appendix 26.1: Cancelled LPO to NBTL................................................................................. 39 Appendix 26.2: Vehicles Exceeding 200,000km Mileage........................................................ 39 Appendix 26.3: Plants Lying Idle............................................................................................. 41 Appendix 26.4: Idle Vehicle that were not in Operation .......................................................... 42 FINANCIAL STATEMENTS The accounts for the Ministry were not provided for audit until early October 2008.
Despite the efforts of auditors to complete the audit of the financial statements, the Permanent Secretary and the Principal Accounts Officer have not signed the 2007 audited accounts as at the date of finalisation of the Audit Reports.

Ministry of Transport, Works & Energy Section 26: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 AUDIT FINDINGS DEPARTMENT OF METEOROLOGICAL SERVICES 26.1 Sub-letting of quarters by Department’s Staff.
It shall be a condition of the letting arrangement under which an Officer is provided with Government quarters or private quarters rented or subsidized by Government that he/she does not sub- let any part thereof or use the quarters to take in a lodger or paying guest without the express permission of the Secretary for the Public Service.1 Audit noted that numerous officers who are allocated quarters offered the Namaka Freebird Institute to accommodate the Japanese nationals at $15/day or $400/month to cater for balanced meals, water, electricity and other services.
The matter was brought to the attention of the Director of Meteorology on 01/05/07 through an email from a staff member who does not have allocated quarters.

The following issues were noted: An investigation was carried out by the Department’s Housing Committee on 22 May 2007 and made recommendations that occupants of these government quarters be allowed to participate as hosts for the Japanese guests with the prior approval of Public Service Commission.
TABLE 26.1: EXTRACTS FROM HOUSING COMMITTEE REPORT AS AT MAY 2007 Name Duration of Home stay Alipate Waqaicelua Ian Singh Talaite Ratucadra Charlie Johnson Narend Kumar Lusiana Bulunasui 14 May – 01 June 2007 Involved in past and present.

A guests had 6 weeks left 3 months (2006) No longer involved.

Had a guest about 2 months about 2 years ago.

Has one guest in May and to complete in July 2007.


Has one guest up to November 2007 Public Service Commission on 12/06/07 advised the Housing Committee for these guests to vacate no later than 17/06/07.

• Audit noted that all officers acted upon the advice by the Public Service Commission except for Ms Lusiana Bulunasui who continued to accommodate the guests up to November 2007.
• Audit could not establish whether there were any follow up by the Housing Committee in respect of these home stays.

The accommodation of guests in institutional and government quarters without PSC approval is contrary to the General Order 609.

Recommendations • The Department must ensure that prior approval of the Public Service Commission must be obtained for any guests that are accommodated in officers allocated quarters.

1 General Order 609.


Ministry of Transport, Works & Energy Section 26: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • Disciplinary action should be taken against these Officers to act as a deterrent for would be offenders.

Department’s Comments The Department did not pursue the matter any further after receiving memorandum from PSC on 12.06.07.
The Department had written a letter of explanation to the Commission and also most of the staff involved[mentioned in your memo collectively wrote to the Commission on the issue stating that they were not subletting but hosting Home Stay Japanese students.

They wrote to say that subletting needed an agreement to be drawn up between the tenant and the Landlord which was never done in this case of Home Stay and that the GO was also silent on the issue of Home Stay.
The Department awaited a reply to both the above correspondence from PSC but unfortunately we have not received any reply as yet and all staff concerned either cancelled their new Home Stay intake or waited until their school term ended and the students flew back to Japan.
To discipline only one staff when there were more than one staff who allowed their students to stay until their school term ended in December and in view of the many other civil servants in the Nadi area hosting Home stays until end of the year we deemed it unfair to discipline only.
The Department has however informed all staff involved not to take in any more Homestay in 2008 until there is a clear ruling made by PSC thus no one has engaged any new Home Stay from 2008 until to date or all those involved just saw their last Home Stay fly off and never took in anyone else.
AUDIT FINDINGS FIJI ISLANDS MARITIME AND SAFETY ADMINISTRATION 26.2 Overpayment of telephone rentals The principle of responsible financial management is to ensure that value for money is obtained in the use of money and resources.2 Audit noted that the Department had been paying Telecom Fiji Limited telecom rental for service number 3315266 on an average of $470/month since late 2005.
Audit noted that COMPAC had replaced the PABX system on 07/11/05 and had installed a new system on an outright purchase which should only include line rentals of $35/month.

However, the department has been paying rentals on the PABX system until February 2008.

Refer to table 26.2 for details of excess payments made in 2007.

The Department had advised Telecom Fiji about the problem in October 2005.
TABLE 26.2: EXCESS RENTAL PAYMENT – 3315266 Month March April May June July August October November Paid $ 472.14 471.62 470.52 470.52 470.52 471.49 473.02 471.01 Payable $ 35.00 35.00 35.00.
35.00 35.00 35.00 35.00 35.00 Excess $ 437.14 436.62 435.52 435.52 435.52 436.49 438.02 436.01 2 Financial Management Act 2004, Section.5(c) Ministry of Transport, Works & Energy Section 26: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Month Total Paid $ 3,770.84 Payable $ 280.00 Excess $ 3,490.84 Audit also noted that service numbers 3304220, 3240021 and 3311302 were not used but rental for them were paid for.
While Telecom Fiji has amended its rental charges from February 2008, recovery has not been made on the overpayments since November 2005.

The Department’s failure to recover the money is evidence of wastage and uneconomical use of taxpayers’ funds.

Recommendation The Department should consult Telecom Fiji and arrange for the refund of the excess payments.

Department’s Comments Telephone Number 3304 220 – Directors’ direct line Telephone Number 3240 021- Asst.
Director and Port Master- Parallel connection Telephone Number 3311 302 – Not used due to unpaid bill at the ports The Administration is now paying business line rental only at $35.00 per month.

The Administration had written to Telecom on 20 October 2005 advising them of the continuous billing of both rental charges for the equipment and lines and to cease charging rental for the equipment.

Again the Administration followed this up in 15/01/08.
Telecom (Fiji) Ltd. had responded (by phone) claiming the Administration did not advise them.

Our records confirm otherwise and will continue to follow this up.

As to the parallel connection, which is showing in one account this will have to be separated to register calls properly from the two different sections.

26.3 Long Outstanding Arrears of Revenue The Debtors Clerk must promptly follow up accounts that fall due.
If recovery is unsuccessful after one month, the following actions should be taken: i) no further credit should be extended to the debtor; ii) a demand notice for payment shall be sent to the debtor after his/her debt has been overdue for more than one month; iii) if the account still remains unpaid after the first demand notice was issued, a final notice shall be issued demanding payment within fourteen days.3 A review of the department’s debt recovery procedures indicated that there were no proper recovery measures in place to ensure prompt payments by shipping agents.
As at 31 December 2007, arrears of revenue from light dues amounted to $118,531.

Refer to Table 26.3 below for details.
3 Part 9, Section 9.2.1 – Finance Manual Ministry of Transport, Works & Energy Section 26: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 TABLE 26.3: ARREARS OF REVENUE – LIGHT DUES Period 3 months 6 months 9 months 1 year & over 2 – 5 years Over 5 years Total Amount $ 51,842 21,429 4,107 26,506 13,542 1,105 118,531 % 44 18 4 22 11 1 100 The Revenue Clerk at the Ministry and the Clerical Officer under the Shipping/Regulatory Office (Suva) of Fiji Islands Maritime Safety Administration (FIMSA) has been issuing reminders to shipping agents.
Audit also noted that numerous payments received from shipping agents were made directly to the Ministry’s headquarters.

Furthermore, those payments received from agents at Headquarters were not communicated to FMISA to update its accounts.

The miscommunication between the officer issuing reminders and the revenue clerks has resulted in the delay in informing shipping agencies of the correct amount owed.

This has also contributed to the accumulation of arrears of revenue.
Recommendations • The responsibility of issuing reminders and collection of debts should be entrusted with the Assistant Accounts Officer – FIMSA.

• Management should ensure that reminders are sent on time to ensure prompt collection of debts and reconciliation should be carried out regularly between the Headquarters’ records.

• Concerted effort should be taken to recover the outstanding debts.

• Suspending or restricting services to shipping agents which owe debts should also be considered.
Department’s Comments The Declarations by shipping agents with Customs are now collected daily.

Reminders are sent to Shipping Agents when payment becomes overdue.

Management is of the opinion that the sending of reminders is best maintained with Shipping Office which now has a dedicated officer.

Generally most of the arrears of revenue are from fishing vessels and the department is liaising with Customs on the issue of collection and clearance.
GOVERNMENT SHIPPING SERVICES 26.4 Vessel fuel used for fuelling motor vehicles Inventory should be purchased in the most economical manner having regard for the expected level of usage.4 4 Finance Instruction 43 (1), 2005 Ministry of Transport, Works & Energy Section 26: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Audit noted that the fuel purchased for the vessels was also used by the Department’s vehicles.
Vehicles from the Ministry with registration numbers GM 777; GN 046; GM 739 and GM 839 were also fuelled from this source.5 Refer to Table 26.4 below for details.
TABLE 26.4: VEHICLES RE – FUELLED FROM VESSEL FUEL STORAGE Date Vehicle # 10/07/07 05/09/07 05/09/07 26/09/07 04/10/07 09/10/07 09/10/07 09/10/07 12/10/07 14/10/07 16/10/07 19/10/07 19/10/07 19/10/07 5/11/07 5/11/07 5/11/07 7/11/07 8/11/07 13/11/07 13/11/07 13/11/07 14/11/07 15/11/07 21/11/07 22/11/07 Total GN 107 GM 887 GN 029 GM 887 GM 887 GN 029 GM 887 GN 029 GN 029 GN 029 GM 887 GN 029 GM 839 GM 887 GM 887 GN 029 GM 839 GM 887 GN 029 GM 739 GM 777 GN 046 GN 029 GM 887 GM 887 GN 046 Amount (litres) 58 60 70 60 24 86 57 18 88 50 48 80 36 32 60 67 37 54 43 30 70 70 73 46 48 77 Average Rate $ 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 Amount $ 87.00 90.00 105.00 90.00 36.00 129.00 85.50 27.00 132.00 75.00 72.00 120.00 54.00 48.00 90.00 100.50 55.50 81.00 64.50 45.00 105.00 105.00 109.50 69.00 72.00 115.50 2,163.00 The fuel storeman stated that the Acting Director gave the authority for the vehicles to be refuelled from the vessels’ bowzer due to closure or unavailability of fuel at the PWD Depot.
Moreover, appropriate accounting journals are prepared to allocate expenditure allocations.

The above practice could affect the fuel allocation for vessels should an urgent fuel need arises for vessels.

Recommendations • Surcharge action should be taken against the responsible officers.

• The practice of issuing fuel from the vessels bowzer should cease immediately.

5 The department had assured audit, after the issue was raised in 2006 that vessel fuels would not be abused.
Section 26: Page 7 Ministry of Transport, Works & Energy REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Department’s Comments In view of the past practice where no record was kept for vehicles filling fuel from Bunker at Shore – GSS, we have implemented control measures last year, and slowly the system is improving.
Before the PMO and Cargo Officer authorized the fuel from Bunker, but now the Department has implemented control measures and only Acting Director GSS or HOD – GSS can authorize transactions depending on the surrounding circumstances.

The operation of GSS fleet is such that at times odd requests do arise where LPO’s could not be issued.

FMIS and the bureaucracy in terms of approval and signing of LPO for fuel also affects the operation and leads with no option but to fill from the bunker.
These transactions are later journalize by the Assistant Accounts Officer to its correct budgetary allocations.

The other non listed vehicles belong to the Ministry.

The Department is adamant that come a time with current strict policies being implemented, this issue will be solved completely.
26.5 No Credit Note/Refund for Drum Deposits Accounting Officers and all other Officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and ensure that proper value is obtained for all sums spent.6 Audit noted the Department purchase drums of fuel for its vessels from Total Fiji Limited with a refundable deposit of $50 per drum.

Audit noted that Total Fiji Limited has yet to refund a total of $34,150 after drums were returned.
Refer to Table 26.5 below for details.
TABLE 26.5: OUTSTANDING REFUNDABLE DEPOSITS FROM TOTAL FIJI LIMITED Date Payee Quantity Drum Deposit $ 2006 4/01/07 24/01/07 01/02/07 09/03/07 27/03/07 11/04/07 24/05/07 29/05/07 25/06/07 10/07/07 20/07/07 28/08/07 06/09/08 17/10/07 24/10/07 15/11/07 29/11/07 06/12/07 Total Outstanding refund Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Total Fiji Limited Finance Instruction 18 Ministry of Transport, Works & Energy Section 26: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The issue was also reported in the 2006 Audit Report.
Recommendations • The Department should ensure that proper records are kept for empty drums and follow up action be made with Total Fiji Limited for the refund of the drum deposits.

• Surcharge action should be taken against responsible officers for not maintaining proper records.

Department’s Comments The issue of Drum Deposit and Credit Note was brought to attention in 2006.
In 2007 follow-up inspection was carried out by Ministry of Finance and in August 2007, the problem of mis-appropriation of Empty Drums surfaced.

A plastic Rota Tank has been purchased to store used engine oil from vessels.

A system of handling empty drums, and dispatching drums with fuel was outlined and documented.

This resulted in stoppage of Empty Drums being sold to public at the cost of $1.10.

Strict directives and control measures were implemented and sale of empty drums was ceased immediately.
All Engineers were informed of the procedures and accountability of Drums onboard and at shore together with the handling procedures.

The system of Tally Card of all Drums was implemented from 01.10.2007.

As far as the internal control is concerned, implementation is working; however slight misunderstanding on the part of our Payments Clerk and Total Fiji Limited has resulted to no Credit Notes being received from the company.
The Department has all the records of Empty Drums being uplifted by Total Fiji from the yard and will definitely seek credit note.

The procedure with Total Fiji Limited was not made clear to us at first stage, therefore, this will be formalized in the month of May – 2008.
26.6 In-operative Vessel - Adi Cagi ni Toba The responsible authority for a budget sector agency is responsible for the effective, efficient and economical management of the agency and also ensuring that money and property of or under the control of the agency are properly accounted for.7 Audit noted that the Department took over the vessel Adi Cagi ni Toba from the Ministry of Fisheries and Forestry in 2002.

There were 3 crews appointed to work with Adi Caginitoba and were based in Labasa.
The following anomalies were noted.

• The vessel had not been utilised since it was taken over from Ministry of Fisheries and Forest and had been undergoing maintenance since 2002.

Audit was not able to be provided the cost of repairs and maintenance from 2002 to 2006 since staff at the Department were recently transferred from other Department.

• In 2007, the Department paid a total of $10,160 for its repairs and maintenance.
7 Section 28 – Financial Management Act 2004 Ministry of Transport, Works & Energy Section 26: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The 3 vessel crews allocated for Adi Caginitoba who are based in Labasa are being paid wages despite the vessel being berthed in Suva since it was received from the Ministry of Fisheries and Forest.

In 2007, the crews received a total sum of $29,113 in wages.
The decision to take over the vessel was ill conceived and a waste of government resources.

Recommendation The Department should stop all repairs on the vessel and redeploy the workers to where they are needed.

Department’s Comments Ever since my joining GSS in June 2005, the vessel “Adi Caginitoba” has had consistent repairs to her wooden structure to clear rotting of timber and badly managed repairs.

It came down to a combined unofficial survey which includes representations from FIMSA (Capt.
Fifita), GSS officials and tradesman from Marine Industrial Shipyard Limited.

The survey was required due to complaints from the crew (Labasa Crew) on their total reluctance and fear to serve onboard the vessel due to its unseaworthy conditions.

This survey was carried out almost immediately after some major structural repair was just recently completed.

Hence it was resolved that the vessel was best kept for spare parts as maintenance and repairs would be continuously and costly.
While the initial idea of putting the vessel back into service after being written off by the Fisheries Department was genuine and sound then, proper consultation for repairs with qualified wooden shipwright tradesman may have been amiss.

Hence the idea and the notification to the audit officers that the vessel was best suited for spare parts with the official documentation and procedures to follow suit.
The Labasa crew members will be given notice for transfer given the fact that immediate transfer will have social obligations affecting their family.

They will be given three months notice to either accept transfer, arrange for housing and completely based at Suva port or resign from employment.

Failure for them to meet these conditions will eventually lead to termination of their employment as the Department do not need out stationed based officers.
This transfer will be in accordance to Crew Regulation.

AUDIT FINDINGS – DEPARTMENT OF ROADS HEADQUARTERS 26.7 Anomalies in expatriate staff contract agreements Accounting Officers and all other Officers should at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sum spent.8 Ministries/Departments are to introduce monitoring procedure to be endorsed by the expatriates when signing his contractual appointment.
PSC should be informed at the end of each six months of work performances of all expatriates.

All extension of contracts must be approved by PSC.

Each Department/Ministry must seek approval for extensions of 3 months before the expiry of the contract.
Full justifications must be submitted.9 8 Finance Instruction 18 9 PSC Circular 23/2001 dated 22/08/01 Ministry of Transport, Works & Energy Section 26: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Mr. Rajasekra Muhadiramge Christie Malraj Karunaratne (EDP 63707) and Mr. Sattambiralalage A Fernando (EDP 63814) of Sri Lanka signed a contract with CEO Works and Energy to work as Senior Road Engineer and Senior Road Maintenance Engineer respectively.
Audit noted a number of discrepancies in payments made to these expatriates.

Refer to the Table 26.6 below for details.

TABLE 26.6: ANOMALIES TO PAYMENT TO EXPATRIATES Expatriate Name Contract Details Anomalies noted RMCM Karunaratne Valid from 16/01/03 to 16/01/06 Renewed on 11/09/06 Officer was working for the Department for 8 months without his contract being renewed and was paid manually for the 8 months.

Contract wasn’t discussed nor endorsed by PSC.


Entitled to gratuity of 25% of the total basic salary ($39,448) upon completion of each period of 12 months of service.

Entitles the officer, his wife and two children ,adult economy class passages by land, sea or air at the option of the Government between the officers home and station in Fiji.

Entitlement of education allowance of $5000 per child of between 18-27 years of age and educated in Fiji or abroad receiving time instruction.
Valid from 16/01/03 to 16/01/06 Renewed on 08/09/06 full Entitles the officer, his two children, wife and adult class economy passages by land sea or air at the option of the Government between the officers home and station in Fiji.

Entitlement of education allowance of $5000 per child of between 18-27 years of age and educated in Fiji or abroad time receiving instruction full Contrary to PSC circular 23/2001, the officers performance was not evaluated before his contract was renewed.
Gratuity payment was supposed to be $9872 but as per V# 4416, $10,267 was paid.

Audit verifications also revealed that the gratuity payment for the second year of service was due and payable on 16/01/08 but was paid 2 months earlier (i.e.

on 01/11/07) by the Department upon the request of the officer.Officers request for gratuity was post dated 16/01/08 and which was breach of finance procedures.
Department paid $23,676.50 for mid vacation airfares for the Officer and his 4 other family members (his wife and 3 children) to visit Sri Lanka on 08/07/07.Audit noted that an additional $4735.30 was paid for one extra child not an entitlement under the contract.

Officer claimed allowances in excess to $7,350 for his daughter, Dumini Karunaratne, attending the Central Queensland University in Australia on payment dated 16/05/07 on cheque number 671440.
Audit verifications noted that the contract did not state whether the payment of child allowances of $5,000 per child should be fixed for the duration of the contract or for each year of the contract.

Officer was working for the Department for 8 months without his contract being renewed .Contract wasn’t discussed or endorsed by PSC.

Contrary to PSC circular 23/2001, the officers performance was not evaluated before his contract was renewed.
Department paid $23,724.00 for yearly vacation airfares for the Officer and his family members to visit Sri Lanka in December 2007.

The Ministry of Finance initially approved $17,520 being the airfare on LPO number 780558 but the Department incurred additional air passage cost of $6,204 due to delay in payment.
The Department did not seek the Ministry of Finance approval on this additional air passage cost Officer claimed allowances in excess of $10,000 for his son S. Damika Fernando attending a course in Australia.

As per Cheque # 671658, education allowance of $5,000 was paid on 06/06/07.On 12/11/07, another $5,000 was paid as per V #:43970 for the same child.
The contract did not state whether the payment of child allowances of $5,000 per child should be fixed for the duration of the contract or for each year of the contract.

S.A Fernando Ministry of Transport, Works & Energy Section 26: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The failure to draw employment contracts in consultation with the PSC and negligence on the part of authorising officers has resulted in the misuse of taxpayers funds.
Recommendations • The Department should consult the PSC in drawing employment agreements for expatriates.

• The Department should recover the excess airfares paid and the excess education allowance paid to the Officers.

• The Department should provide detailed explanations for the discrepancies.
Department’s Comments We wish to apologise for the lack of consultation work done between the Ministry and PSC when the individual contract for the contract officers were drawn since the contracting arm of expatriate officers is controlled by PSC, the Ministry was of the view that queries raised in this paragraph should also be done by them.

We however wish to confirm that in future we shall consult PSC on all contractual matters.
As for the issues raised in bullets points 2 to 4 the Ministry will investigate the anomalies raised and we will advise you in due course 26.8 Road Safety Management Workshop in Australia The nominated officers are also requested to submit a report within two weeks after their return from the course.10 Expenditure shall be classified and every vote shall be applied for the purpose for which it is approved.11 Audit noted that the Department spent $19,185 solely on per diem, course fees and visa fees for the two Road Engineers, Mr. John Luveniyali and Mr. Monoa Vocea to attend the Road Safety Management Workshop in Victoria, Australia organised by Victoria Roads.
Refer to Table 26.7 below for details of the workshop costs.
TABLE 26.7: ROAD SAFETY WORKSHOP COSTS (EXCLUDING AIRFARES AND ACCOMMODATION) Date Allocation Purpose Reference 02/11/07 15/11/07 01/11/07 Total 1406039999108069930 Course Fees Cheque No: 673486 1406039999108069930 Per Diem Allowance for 10 Days Cheque No: 673614 Cheque No: 673425 1406039999108069930 Visa Application Fees Amount $ 9,269.26 9,700.00 216.00 19,185.26 Audit verifications revealed that the PSC approval to attend the conference was for 5 days from 19/11/2007 to 23/11/2007 but the Department paid allowance for 10 days from 16/11/2007 to 25/11/2007 amounting to $9,700.
Recommendation The overpaid per diem should be recovered from the two officers.

10 Memorandum from Permanent Secretary dated 31/10/07 and PSC Approval Dated 30/10/07 11 Finance Instruction s21, p10.

Ministry of Transport, Works & Energy Section 26: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Department’s Comments i.]
The Permanent Secretary had agreed to pay the per diem for 10 days [please refer to minute] instead of 5 days to allow the officers extra days to familiarize themselves with the geography of the place.

If they had gone on a 5 day trip it would have become very strenuous on them.

The availability of flights was also one of the other reason for the length of the stay.

The management felt at the time that the result of the attendance would be immense.

ii.]
ii.]

This conference was very vital for staff of the Department of National Roads and thus funds were utilized from the Periodic Maintenance for Roads and Bridges Section – Capital Purchase vote since the Training vote was already exhausted.

iii.]

ensure that this will not be repeated.

Report is now submitted [attached], delay for the late submission is regretted.

The management will iv.]


Benefit of the Road Safety Workshop With the issue of road accidents in Fiji becoming more and more important, this workshop was seen as a way of obtaining new ideas on how road accidents could be reduced.

The state of Victoria, Australia is considered a leader in road safety and has seen a significant decrease in the number of fatal accidents since 1970.

There has been a steady trend in the decrease of fatalities since 1970 to now.
VicRoads which is a road authority in Victoria, is a key player in road safety and gave a number of very informative presentations.

VicRoads also invited other stakeholders such as the Victorian Police, manufacturers of road safety equipment etc to make presentations.

The Department of National Roads saw this as an opportunity to expose its staff to new ideas on how road safety can be tackled.
As the Department of National deals with road safety issues on the roads it looks after ideas obtained from this workshop can be put to use.

The Department of National Roads also is a member of the National Road Safety Council so ideas learnt at the workshop can also be put to use in initiatives taken by the Road Safety Council.

As there are a number of fatal accidents happening now in Fiji.
Lessons learnt from this course has played an important role in trying to reduce the number of fatal accidents occurring on our roads.
26.9 ROMDAS conference in India Expenditure shall be classified and every vote shall be applied for the purpose for which it is approved.12 Audit noted that the Department spent $18,464.72 alone in per diem, airfares and visa fees for the three Road Asset Management Technicians, Mr. John Pickering, Mr. Mesake Tamani and Mr. Samisoni Ulitu to attend the Road Measuring Data Acquisition System (ROMDAS) User Conference in New Delhi, India organised by Data Collection Ltd.
Refer to Table 26.8 below for the details of the conference costs.

TABLE 26.8: 26.6.3 ROMDAS CONFERENCE COSTS Date Purpose 02/10/07 Payment of Airfare to Lodhias Travel and Air Fiji Cheque Number 672928-29 Amount $ 1,692.00 Remarks Outstanding amount of Airfare paid.

16/10/07 Reimbursement of air fare to John 673091 80.00 Use of FRUP allocation to Pickering accommodate this payment.

12 Finance Instruction s21, p10.
Ministry of Transport, Works & Energy Section 26: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Date Purpose 27/09/07 28/09/07 For Visa fees and Airfare to Air Fiji For Payment of Perdiem to Mesake Tamani 28/09/07 For Payment of Perdiem to John Pickering 28/09/07 For Payment of Perdiem to Samisoni Ulitu Cheque Number --- 672891 672892 672893 28/09/07 Payment of Airfare to Lodhias Travel For Perdiem short-paid to the Officer 17/10/07 672894 673113-115 Amount $ 546.00 Remarks - 1,860.00 This covers 6 days Perdiem as initially requested and approved by Department.


1,860.00 This covers 6 days Perdiem as initially requested and approved by Department.

- 7,572.00 2,994.72 This covers the extra 4 days Perdiem claimed after return from conference Total 18,464.72 Audit verifications revealed that the conference was for 2 days only from 4/10/2007 to 5/10/2007 but the Department paid per diem allowances for 10 days from 1/10/2007 to 10/10/2007 amounting to $8,574.72.
This is a case of extravagant expenditure as flights were available for officers to depart from India on 6/10/07.

Furthermore, audit could not sight a PSC approval for the three officers to attend the conference.

Recommendations • A Public Service Commission’s approval should be obtained for all overseas travel.

• The officers responsible for approving the travel and the payment of extra per diem allowances should be disciplined.

• The overpaid per diem should be recovered from the officers concerned.
Department’s Comments i.]

The Permanent Secretary had agreed to pay the per diem for 10 days instead of 5 days to allow the officers extra days to familiarize themselves with the geography of the place.

If they had gone on a 5 day trip it would have become very strenuous on them.

The management felt at the time that the result of the attendance would be immense.

ii.]
ii.]

PSC Approval We are not able to locate this, however we believe that there should have been a PSC approval, because normally per diems are only processed once PSC approvals are received.

However, the management has given necessary instructions to stake holders to see that all normal procedures are adhered to in future.

iii.]
iii.]

This conference was very vital for staff working in the Data Collection Techniques required for our national road network infrastructure assets that will enable us to analyze the data collected that will identify sections of road that requires rehabilitation and reconstruction together with its associated budget level.

Funds were utilized from Periodic Maintenance for Roads and Bridges Section – Capital Purchase Section vote since the Training vote was already exhausted.
You will have seen that they have had an immense effect in their output ever since they returned from the course.

iv.]

Cost benefit.

It was an opportune time for DNR Technicians to gain knowledge on latest data collection equipment and experiences shared among other users and participants.
It was also a valuable opportunity for the technicians to share their experiences and identify solutions with other participants to be able to upgrade their skills that will Section 26: Page 14 Ministry of Transport, Works & Energy REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 enhance their data collection techniques.
The event also enable Technician to attain the necessary range of skills to operate and run professional data collection operation that can deliver quality network data on a regular basis.

The knowledge attained from the conference has enabled the Technicians to maintain level of support and maintenance service required for the DNR Road Asset Management System and equipments to maintain its effectiveness and sustainability.
26.10 Death Compensation Claim When the Permanent Secretary or Head of Department considers it necessary that a Medical Board be convened i.e.
either under GO 710 c (ii) or GO 1007, or both, he/she shall immediately attend to the following: request the Permanent Secretary for Health (PSH) to convene a Medical Board on the officer; attach to that request, the medical report(s) medical certificates and sick leave details of the officer concerned and state how the sickness is adversely affecting the officer’s attendance and/or performance; advise the officer concerned that he/she is to be medically boarded; require the officer to complete the appropriate medical Board from (Form M.B.1) and to submit the form fully completed the Permanent Secretary for Health.13 Audit noted that a contributing factor for the workers compensation entitlement for the death of Mr. Semi Radrudru, an unestablished employee at Nabouwalu Depot was due to the laxity and irresponsible behaviour of the Department of National Roads Human Resources section.
The employee suffered from a chronic medical illness and passed away in 2005 upon which an investigation report findings was submitted on 20/06/07.

Based on the investigation report, the Ministry of Works gave its consent to the Ministry of Labour to effect payment of $24,000.

The investigative team’s finding revealed that a doctor’s report dated 18/08/05 recommended that the officer should be permanently laid off work and highlighted the risk to his life if he continues working.
The doctor’s report was hand delivered to the Administrative Officer, Mr. John Tinfulagi at the Labasa office.

It was not possible to determine the date the letter was received at the Depot.

According to the findings, it took 3 weeks for the Department of National Roads Human Resources section in Labasa to submit the doctor’s report and the request for the employee to be medically boarded to Head Office.
The report also states that no follow up was made to Head Office as to the reasons for the delay in the processing of Mr. Radrudru’s medical board.

Audit noted that the Head office indicated that it did not receive any memorandum which supposedly contained Mr. Radrudru’s medical board form.

It turns out, as confirmed by Mr. Kolosa Vocea (Clerk) in Labasa that the appropriate requisition form (Medical Board Form) was never filled by the employee.
Audit noted that no officer from the Department of National Roads Human Resources section has been held responsible for the compensation paid to Mr. Radrudru’s beneficiaries.
13 Conditions and Rules of Employment for Government Unestablished Employees Section II Clause 16(e) Ministry of Transport, Works & Energy Section 26: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • Any officer found medically unfit to carry on work should be medically boarded in compliance with GO 710 and 1007.
• The Department should take immediate steps to implement the recommendation of the investigation team which includes instituting disciplinary and surcharge actions against officers from the Human Resource section for failing to ensure that proper medical procedures were followed in Mr. Semi Radrudru’s case.

• Adverse medical reports received by the department should be attended to immediately to avoid similar incidents.
Department Comments The audit comments are noted and appropriate actions as recommended will be taken.
DIVISIONAL ENGINEER ROADS CENTRAL EASTERN 26.11 TMA profitability and operations – Nasinu Quarry & Starmix TMA’s were initially formed to operate on semi commercial basis using a Revolving Fund Concept which is to adopt a cyclical nature of their cash flow into and out of the fund by providing goods and services and financing their known operations with income derived from sales to customers.14 The TMA’s were created to provide goods and services that are needed by other government departments and the private sector when possible.
However, it is required that the TMAs should break even to ensure that all costs incurred in its operations are recouped.15 The major accounts maintained by the Department are as follows: Starmix – responsible for the processing of raw materials [coal tar] for road works.

Starmix is involved in processing products which are mainly used in road construction such as asphalt and bitumen.

These products are mostly used by Ministry of Works.
Quarry – The main function of the Crusher is to crush hard stone into various sizes to be used by government Ministries/Departments such as Ministry of Works in construction works, for example roads.

Audit review of the TMA business plan for 2007 shows that cash flow forecasts for the year were anticipated to achieve profits of $14,652 and $405,684 in the Nasinu Starmix and Nasinu Quarry respectively.

The Department failed to meet the set targets, showing poor performance of the TMA’s.
An analysis of the profitability and performance of the Departments TMAs for the last five years is shown in the Table 26.9 below: 14 Finance Circular No.

15/2007 Dated 6th July 2007 – Section 1.2 15 Finance Circular 37 of 26 November 1984.
Ministry of Transport, Works & Energy Section 26: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 TABLE 26.9: PROFITS AND LOSSES FOR DECE TMA ACCOUNTS (UN-AUDITED) TMA 2003 2004 2005 2006 2007 Nasinu Starmix Nasinu Quarry 32,888 (150,801) (13,752) 984 270,280 242,774 (226,773) (262,553) (46,240) 32,764 Figure 1: DECE TMA Suspense Profit(Loss) s 0 0 0 $ ) s s o L ( t i f o r P 300 250 200 150 100 50 0 -50 -100 -150 -200 -250 -300 2003 2004 2005 2006 2007 Starmix Quarry Years The Nasinu Quarry made a profit in 2007 compared to a significant loss in 2006.
No action has been taken to analyse the performance of the TMA or to question the performance output of the Road Supervisors responsible for the operations of the TMA.

Audit further noted that the Department transferred operating funds to the TMA amounting to $185,524 for the routine maintenance of the Quarry and Starmix without proper authority.

The TMA are supposed to be self-funding and operate on a commercial basis.

Refer to the Table 26.10 below for details.


26.10: INVESTMENT INTO THE TMA’S (UNAUDITED) TMA Nasinu Starmix Nasinu Quarry Total Allocation Transferred from Operating Fund $ 65,000 117,524 185,524 The transfer from the Department into the TMA resulted in the Nasinu Quarry being able to record a profit in 2007.The Nasinu Quarry and Starmix would have continued to make losses in 2007 if the transfer of allocations from the operating fund account were not made.
Projected targets in the TMA’s business plan will not be achieved if the department continue to rely on operating funds.

Recommendations • The Department should carry out a comprehensive review of the TMAs in consultation with Ministry of Finance to ensure that the operations are viable.
Ministry of Transport, Works & Energy Section 26: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The reasons for the significant losses incurred in the Nasinu Starmix should be investigated and appropriate measures put into place to reduce them.

• The Department should put in place some mechanisms through an effective business plan to help improve the performance of the Nasinu Quarry and Starmix.
• The Department should regularly liaise with the Asset Management Unit of the Ministry of Finance to strengthen the monitoring role of the Trading and Manufacturing Account (TMA).

Department’s Comments As recommended in 2.1, the Department agrees with the recommendations.

An increase of 5% in price has been sought.

Should the operations not be viable, we will still continue to operate to ensure the price control measures are in place, i.e the market prices by the private contractors.
The significant loss incurred by Nasinu Quarry and Nasinu Starmix is attributed to the continuous breakdown of the crushers which are old, and due to the increase in the cost of raw materials.

This should justify the need to purchase a new plant.

There is a proposal to obtain external help for funds to rehabilitate the plants and an increase in prices.

The “on cost” should be either removed altogether or a good portion of it to be given to Nasinu Quarry.
The recommendations have been noted and will be implemented.

The whole structures of the crusher are old.

The plants are obsolete and require constant repair, therefore, we feel that the officers in charge should not be held responsible for the TMA’s performance.

It was always the departments intention to keep it running to regulate the prices.
DIVISIONAL ENGINEER ROADS WESTERN 26.12 Trading and Manufacturing Account (TMA) TMA’s were initially formed to operate on semi commercial basis using a Revolving Fund Concept which is to adopt a cyclical nature of their cash flow into and out of the fund by providing goods and services and financing their known operations with income derived from sales to customers.16 The major accounts maintained by the Department are as follows: Starmix – responsible for the processing of raw materials [coaltar] for road works.
Starmix is involved in processing products which are mainly used in road construction such as asphalt and bitumen.

These products are mostly used by Ministry of Works.

Crusher – The main function of the Crusher is to crush hard stone into various sizes to be used by government Ministries/Departments such as Ministry of Works in construction works, for example roads.
26.12.1 Profitability and Investment in TMA Operations The government identified 3 categories of investment over the life of the TMA operation.

They are17: − Financial Ceilings 16 Finance Circular No.

15/2007 Dated 6th July 2007 – Section 1.2 17 Ministry of Finance TMA Training Manual Documents Ministry of Transport, Works & Energy Section 26: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 − Losses incurred by the TMA’s − Separate Bank Accounts.
The TMA’s were created to provide goods and services that are needed by other government departments and the private sector when possible.
However, it is required that the TMAs should break even to ensure that all costs incurred in its operations are recouped.18 An analysis of the profitability and performance of the Departments TMAs for the last five years is shown in the Table 26.11 below: TABLE 26.11: PROFITS AND LOSSES FOR DEW TMA ACCOUNTS (UN-AUDITED) TMA 2003 2004 2005 Lomolomo Starmix Lomolomo Crusher 165,252 (60,811) (14,938) (77,839) 598,014.79 (9,833.38) 2006 (excluding Previous Years Bal) (122,336.78) (33,432.43) 2006 (Cumulative Figure) 441,125.49 (45,591.86) 2007 (As at 2nd Quarter) 300,919.23 (40,301.44) Figure 2: DEW TMA Suspense Profit(Loss) s 0 0 0 $ ) s s o L ( t i f o r P 650 600 550 500 450 400 350 300 250 200 150 100 50 0 (50) (100) (150) (200) Starmix Crusher 2003 2004 2006 2007 2005 Years The graph above illustrate that the Lomolomo Crusher continued to incur losses for the past five years.
The Lomolomo Starmix on the other hand has been experiencing a fluctuating profit trend.

Audit noted that the total investment by the government into Lomolomo Crusher and Lomolomo Starmix to date is $1,334,974.

Refer to Table 26.12 below for details.


TABLE 26.12: INVESTMENT INTO THE TMA’S (UNAUDITED) TMA Lomolomo Starmix Lomolomo Crusher Total Financial Ceiling $ 120,000.00 100,000.00 230,000.00 Over-expenditure Outflow $ 170,369.38 944,604.50 1,114,973.88 Separate Bank Accounts $ --- --- --- Total Investment $ 290,369.38 1,044,604.50 1,334,973.88 It is seen that over the years, not much effort has been injected into the TMAs to address profitability and sustainability in the long term.
18 Finance Circular 37 of 26 November 1984.

Ministry of Transport, Works & Energy Section 26: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • The Department should carry out a comprehensive review of the agencies TMAs in consultation with Ministry of Finance to ensure that the operations are viable.
• The reasons for the significant losses incurred in the Lomolomo Crusher and Starmix should be investigated and appropriate measures put into place to reduce them.

• The Department should put in place mechanisms through a business plan that will help improve the performance of the Lomolomo Crusher and Starmix.

• The Department should regularly liaise with the Asset Management Unit of the Ministry of Finance the need to strengthen the monitoring role of the Trading and Manufacturing Account (TMA).
Department’s Comments The Management is taking all measures to strengthen and improve the Lomolomo Crusher and Starmix.

The Department is regularly liaising with the Asset management Unit of then Ministry of Finance.

performance the of 26.12.2 Performance of Lomolomo Crusher Audit noted that the Lomolomo Crusher was not operational for 3 years, 2005, 2006 and 2007.

Refer below for details of the months in which the Lomolomo Crusher failed to generate any sales revenue as a result of its non-operation.
TABLE 26.13: DETAILS OF THE PERFORMANCE OF LOMOLOMO CRUSHER Year 2005 No.

Of Months In Operation Nil 2006 2 2007 Nil Lomolomo Crusher Non-Revenue Generation Months No Income was generated during the year because Crusher was not in operation for 12 months from January to December January to February and from April to September and from November to December, no Income was generated as Crusher was not operational.

The Crusher operated in March and October only.


No Income was generated during the year because Crusher was not in operation from January to November.

Discussions with the Road Supervisor at Lomolomo Depot revealed that the Crusher was not operating due to breakdown of the primary crusher jaw.

The breakdown of the Crusher has caused major hindrance on the ongoing patching and resealing works in the Western Division roads.
Audit was informed that the Ministry of Finance is yet to approve the purchase of two bearings for primary crusher jaw required for Lomolomo Crusher amounting to $14,963.

Audit verifications revealed that labour cost and plant hire charges dominated the expenses of the Lomolomo Crusher even though the Crusher brokedown and no output was generated for the months highlighted in the table above.

Audit findings indicate that the ability of the Crusher to operate profitability is uncertain.
Recommendations • The Department should ensure that labourers are not left idle but should be engaged in other work.

Other work should be charged to other funds and not the TMA.

Ministry of Transport, Works & Energy Section 26: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • Consultations should be carried out with the Ministry of Finance on getting prompt approval for the equipment required to fully operate the Lomolomo Crusher.
• The Department should carry out a comprehensive review of the Lomolomo and TMAs in consultation with Ministry of Finance to ensure that the operations are viable.

This should include reviewing the selling price and appropriate mark-up.

• The reasons for the significant losses incurred in the Lomolomo Crusher and Starmix should be investigated and appropriate measures put into place.
• The Department should justify the plant hire and labour costs when the Crusher TMA was not operating or generating any revenue.

Department’s Comments When the Crusher is not in operation workmen are engaged in Routine maintenance activities and are also paid from it.

A submission has been forwarded to Ministry of Finance for approval of the revised rates.

26.13 Stolen Premix from Fuel Room Losses may occur as a result due to uncontrollable circumstances or ineffective internal control.
The loss report should outline the nature of the loss, circumstances leading to it and the recovery measures taken.19 Audit noted that two 20 litre gallons of premix fuel was drained out from the gallon kept near the locked door of the fuel and oil room at Tavua Depot on 7/09/07.

No police report was prepared for this incident and no officer has been surcharged/disciplined as at the date of audit (6/11/07).
Recommendations • The Department should carry out an investigation as to how such an incident happened.

• The Department should provide explanations why a Police report or a loss report has yet to be prepared.

• The Department should ensure appropriate measures are in place to prevent such incidence happening.

Department’s Comments An investigation regarding fuel theft at Tavua Roads stores was done immediately and recommendations for surcharge actions against the officers concerned had been undertaken.
The stores in Tavua will be renovated to improve its security.
26.14 Contractor in Default The Employer may terminate the Contract if the Contractor causes a breach of Contract on the following: failure of the Contractor to commence works by the date stipulated in the Contract; − − where the Contractor consistently refuses to commence the works ordered within one week as provided in the contract; 19 Finance Manual Part 14 (page 89) Ministry of Transport, Works & Energy Section 26: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 − where the contractor consistently refuses to execute the works in accordance with the details of the contract technical specifications, drawings and schedules.
If the contractor does not carry out the work within a week of the due date, the Engineer will execute the works utilizing other means.

Any additional costs incurred due to the above will be charged to the contractor.20 Audit noted that the Routine Maintenance Grading works for the Nadroga – Nadi area was awarded to National Bulldozing & Transport Co. Ltd for the sum of $1,017,030 from 2006 to 2008.
The company failed to carry out the work in the first cycle of 2006 and also did not carry out any work in the Nadi Depot area to date.

The Road Supervisor Nadi and Nadroga confirmed that various LPO’s were raised in November 2006 till September 2007 to upgrade the Sigatoka Valley Road, Kavanagasau Road and Lomawai Road but there was no response to these.

Hence the Road Supervisor had to seek assistance from the Road Engineer for available graders to carry out the maintenance works.
This has meant that graders allocated to other projects had to be used to complete urgent works on Nadi and Nadroga Roads.

Refer to Appendix 26.1 for the details of cancelled LPO’s to National Bulldozing and Transport Company Limited as a result of the contractor not able to supply the machinery required for grading works at various job sites requiring urgent road works.
The Auditor Generals Report 2006 highlighted a similar concern and that this contract be terminated and the contractor be penalised for non-performance.

The Department had terminated the contract with National Bulldozing and Transport Company but there was no penalty imposed for non-performance.

The above reflects on the failure of the Divisional Road Engineer in ensuring that the penalty is imposed on contractors who breach the stipulated contract conditions agreement.
Recommendations The Ministry should review its contractual agreements periodically and take appropriate actions when necessary.

Department’s Comments The grading contract in the western division is a new type of road maintenance works contract that’s administered by the Director of Roads( Employer) and the Divisional Road Engineer Western (Engineer).The contract is also new to the contractors undertaking it.
The objective was to introduce this output based contract and compare its performance with the existing hourly rate contract.

Unfortunately the contractor in this case has not performed and the Engineer has recommended that the contract be terminated.

Note that all unattended grading works had been done through the hourly rate contract and as such it has not really not affected our maintenance programme.
Submission has been made the employer who will execute the relevant penalty provision in the contract if deemed necessary.

26.15 Overtime for Unofficial Purpose Overtime should only be worked once approval is secured from the Chief Executive Officer.
Overtime approval should be considered if overtime request confirms that the work in question is of importance and very urgent in nature, which requires immediate attention.21 20 Contract No:WSC02/06/1 Routine Maintenance Grading Western 1 Clause 4.12 21 PSC Circular No.11/04 dated 31/03/04 Ministry of Transport, Works & Energy Section 26: Page 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Scrutiny of the Overtime Authority form reveals that workers are being paid for unofficial purposes.
There was a farewell party for Mr Ram Krishna, the former Divisional Engineer, on 27th September 2007 and the following unestablished staffs were paid overtime for attending a party.

For Ra Depot the overtime authority relating to the party was endorsed by the Roads Engineer, Mr. Munsami Naidu on 04/10/07.

TABLE 26.14: OVERTIME CLAIMS MADE FOR ATTENDING FAREWELL PARTY OF RAM KRISHNA Name Comments Depot Waiyavi FNPF Number DB 857 JF 767 QP 592 FZ 817 Kasiano Waqa Emosi Tawai Kasiano Waqa Jnr.
Kameli R Ra Depot NB 894 Aporosa B FK 216 Timoci Q LJ 128 Kasami GC 156 Bale .

T GD 949 Eremasi Timecard manually filled to state work done till 7pm.Paid for 11 hours.

Timecard manually filled to state work done till 7.30pm.Paid for 9 hours and 2 meal allowance Timecard manually filled to state work done till 7pm.
Paid for 9 hours and 2 meal allowance Timecard manually filled to state work done till 7.30pm.Paid for 9 hours and 2 meal allowance Paid for 3 hours (5pm to 8pm) and one meal allowance Paid for 3 hours (5pm to 8pm) and one meal allowance Paid for 3 hours (5pm to 8pm) and one meal allowance Paid for 3 hours (5pm to 8pm) and one meal allowance Paid for 3 hours (5pm to 8pm) and one meal allowance As confirmed by the Pay Clerk at Lautoka Office, the Ra, Waiyavi, Nadroga, Lomolomo and Tavua Depots do not normally send their overtime requisitions/approvals when they submit their overtime authority forms.
Furthermore, audit noted that overtime record keeping at Ra Depot is very poor.

An overtime requisition file is kept by the Depot but it was noted that only few overtime requisitions are filed compared to the overtime authority records which shows that a lot of overtime work is being done.

Recommendations • Recovery should be made from the employees who were paid overtime claims for attending the farewell party.
• Disciplinary/Surcharge actions must be taken against the responsible officer(s) for approval of overtime payments made to attend the party.

• No payments for overtime should be made until the overtime authority has been signed by the Roads Engineer.

• Time clerk should ensure that all overtime requisitions are filed once approved.
• The pay clerks should demand that all Depots send both their overtime requisitions and overtime authority forms to be endorsed by the Divisional Engineer • The Divisional Engineer should scrutinise the overtime authority forms to see if they tie up with the overtime requisitions before he endorses them for payment Ministry of Transport, Works & Energy Section 26: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Department’s Comment Recommendations are noted, appropriate remedial action will be taken.
All overtime payments made as stated will be recovered.
26.16 Vehicle Accident When a government vehicle is involved in an accident, the officer in charge of the vehicle will complete and submit a Vehicle Accident Report form in quadruplicate to his/her Head of Department unless authorised otherwise, who will within 21 days of the accident forward two copies of the report to the Solicitor General and one copy to the Ministry of Finance.22 When there is damage to or loss of government vehicles, the surcharge should be 100% recovery of the full cost of repairs or replacement.23 Every vehicle must carry a pad of GP Form 75 (Running Sheet) and it is the driver’s duty to fill it with every detail for every particular run.24 Drivers must know that the official vehicles must be for government purposes only.
Detours or journeys for private purpose including transport of family members, school children, etc, are prohibited.

Cases of unauthorised use of government vehicles, or non compliance with these instructions, shall be treated as disciplinary offences.
Furthermore, officers found using official vehicles for unauthorised purposes are liable to pay private hire rates, be surcharged, and/or disciplined, depending upon the circumstances in which the vehicle was used.25 Audit noted that the Ba Road Supervisor, Aisea Liwaiono ((EDP Number 60911) drove the government vehicle registration number GK817 by himself for unofficial purposes on 11/01/2007 without and formal instruction/authority and caused an accident resulting in the Mechanical Section of Plant Poll doing repairs worth of $2,705.
Audit scrutiny also revealed that the driver was carrying his wife as a passenger in the vehicle when the accident happened and the driver failed to the immediately inform the Plant Pool about the accident.

The accident was reported the following day by the Ba Depot mechanic.

Every government vehicle must have a proper instruction before leaving any depot or yard.

In this case, Mr. Liwaiono drove GK817 out from Ba Roads Depot without instruction.
The last instruction for this vehicle was issued to Jobe V starting from 7.00am to 5.00pm.

The time of accident is 8.00pm and scrutiny of the instruction book reveals that no instruction was issued to GK817.

Audit also noted that Mr. Liwaiono’s authority to drive was valid until 31/12/06.

At the time of this accident at Koronubu, his authority was invalid and Plant Pool received his application for the renewal of his authority on 17/01/07.
Recommendations • The Road Supervisor should be fined for breaking the transport rules and regulation and driving without authority.
22 Transport Rules and Instructions 18 23 Finance Instructions 2005 – Section 75 24 Transport Rules and Regulations Clause 13 (1) 25 Transport Rules and Instructions 14 Ministry of Transport, Works & Energy Section 26: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The Divisional Engineer must provide explanation for failing to take the necessary disciplinary actions on this very serious offence considering that it is almost 11 months from the date of the accident.
Department’s Comments The Department had carried out its investigation and has recommended that the officer be surcharged the amount of $300.0 as he was not at fault in the accident.

His authority to drive has also been withdrawn.

The investigation was carried immediately after the accident.
AUDIT FINDINGS – DEPARTMENT OF WORKS AND MECHANICAL CHIEF ENGINEER MECHANICAL SECTION 26.17 Trading and Manufacturing account 26.17.1 Overall Financial Performance of CEME TMA The TMAs were created to facilitate on a semi-commercial basis the provision of goods and services that are needed to other government departments and also to the private sector when possible.

However it is required that the TMAs should break even to ensure that all costs incurred in its operations are recouped.
26 The major accounts maintained by the Division are as follows: 1.

Plant Hire – the Plant Pool of the Mechanical section maintains all government vehicles that are hired by the various sections of the Ministry.

2.

Fuel and Oil – fuel depots are maintained at various divisions of the Ministry to supply fuel and oil to all government department vehicles at a cheaper rate compared to the commercial bowsers.

3.
3.

Workshop Wages – the workshop is responsible for all repair works carried out to the Ministry’s vehicles.

The section of the Ministry that hired the vehicle meets the repair costs incurred.

Audit scrutiny of the financial performance of the TMAs within the Central Eastern Division revealed huge losses in their operation for the year 2007.

Table 26.15 below provides the three quarter analysis of all the financial results of the TMA operating under CEME.
TABLE 26.15: NET PROFIT/LOSSES FOR THE YEAR Quarter 1st 2nd 3rd Profit/Loss ($) 159,782.79 (539,626.00) (131,790.00) Audit noted that the surplus funds from the Fuel and Oil TMA was used to finance the deficits or operation on other TMAs such as Plant Hire and Workshop Wages.

26 Finance Circular 37 of 26 November 1984.


Ministry of Transport, Works & Energy Section 26: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation The Ministry should carry out a comprehensive review of its TMAs in consultation with Ministry of Finance to explore ways how the operations of the TMAs can be made more viable.
Department’s Comments The Audit recommendations are noted and management will liaise with Ministry of Finance to conduct a review of the operations of TMA and its viability.

The viability of the TMA was considered when drawing up the corporate and business plan, however circumstances beyond our control was the contributing factor in incurring losses.

Management will consider other options apart from closing unprofitable TMA which will be the last resort.
26.18 Plant Hire TMA Plant Hire – the Plant Pool of the Mechanical section maintains all government vehicles that are hired by the various sections of the Ministry in the Central Eastern Division.

An analysis carried out on the fleet of Plants and vehicles in the Division showed the following concerns.
26.18.1 Replaceable Government Vehicle Ministries and Department Vehicle should be replaced after six years or after it has covered 200,000 km, whichever is earlier.27 Audit investigation revealed that Government Vehicle exceeding 200,000km were still in operation and have not been replaced as required under the government vehicle policy.

Refer to Appendix 26.2 for details.

In addition, it was noted that these vehicles had been operating for more than 6 years.
26.18.2 “Idle” Plants and Vehicles incurring Oil, Fuel and Maintenance Costs Audit investigation revealed that a few plants and vehicles which were idle and not operating were still incurring cost such as, oil, fuel, and maintenance costs.

Refer to Tables below for details.

TABLE 26.16: IDLE PLANTS INCURRING COSTS REG NO.


Type of Plant Age GL 718 GK907 GJ 351 GK202 GL994 Cat D7 Komatsu D6 M.F Loader Clark Loader TCM Loader 30 19 18 23 14 State 3rd Qtr Total Hrs (Acc) 2007 130,910 Very Poor 10,628 Fair 8,451 Very Poor 24,049 Fair 17,968 Fair Cost of Fuel & Oil Cost of Mtce.

2007 $ 2,162.00 $ 229.23 6.00 32.72 585.00 Purchase Price Profit / (Loss) 2007 $ (229.23) $ 11,000.00 (2,162.00) 118,379.60 36,105.89 (6.00) (32.72) 45,845.00 (585.00) 232,531.52 Total Mtce.
Cost (Acc) 2007 $ 160,681.00 148,069.00 21,807.00 120,599.00 157,378.00 27 Government Vehicle Policy , Cabinet Paper CP (98) 73, section 82 (k) Ministry of Transport, Works & Energy Section 26: Page 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 GJ543 GJ535 Total 1H1 K250 Crane Dynapac Roller 26 26 18,074 Fair 22,219 Fair 282.00 1,134.95 216.00 6.00 2,384.00 (498.00) 154,131.00 40,720.00 (6.00) 3,518.95 273,852.00 69,362.00 TABLE 26.17: IDLE VEHICLES INCURRING COST REG NO.
Gl 379 GK813 GL 518 GL 444 GL 684 GL 715 GM 051 Type of Vehicle Age Toyota Liteace 14 Mitusbish Pajero 19 17 Nissan Twin Cab Mitsubishi L200 M/Bus Daihatsu F/Top Daihatsu T/Cab Isuzu Hoist Truck Isuzu Tip Truck 19 19 12 17 12 12 GM 241 GM 222 Mitsubishi T/Truck Total Total Mileage (ACC) (Km) 2007 205550 6255621 314,407 49844 58914 498,023 244190 239684 250283 State Cost of Fuel & Oil $ Cost of Maintenance $ Profit & (Loss) 2007 Purchase Price $ Total Mtce Cost (Acc) $ Poor Poor Poor Poor Poor Poor Fair Fair Poor 0.00 0.00 6.00 6.00 0.00 0.00 0.00 0.00 6.00 6.00 6.00 0.00 0.00 12.00 6.00 12.00 (6.00) (6.00) (6.00) 15,665.00 19,053.00 F.M.F Veh 18,773.00 36,948.00 15,433.00 (6.00) 17,871.00 22,817.00 (12.00) (6.00) (12.00) 12,079.14 18,687,.62 97,573.59 3,825.00 78,674.00 33,747.00 733.00 3,883.00 (733.00) (3,889.00) 73275.90 94,518.06 54,933.00 47,542.00 18.00 4,658.00 4,676.00 The above finding shows uneconomical expenditures and also increases the possibility of malpractices or fraudulent activities given the manner in which costs were incurred despite the plants and vehicle being idle.
26.18.3 Government Vehicle and Plants Generating Losses Audit analysis of Vehicle and Plant maintenance and operating cost disclosed that some vehicles and plants were constantly generating losses while some incurred excessive maintenance and operation cost.

Refer below for details.

TABLE 26.18: PLANTS THAT INCUR LOSS FOR THE 3RD QUARTER REG NO.
Type of Plant Age GL 718 GK907 Cat D7 Komatsu D6 GJ 351 M.F GK202 GL994 GL641 Loader Clark Loader TCM Loader Champio n Grader GM 859 Cat Grader 30 19 18 23 14 16 5 3rd Qtr Total Hrs (Acc) 2007 130910 10628 State 3rd Qtr (Km) 2007 Very Poor Fair Cost of Fuel & Oil 2007 $ 229.23 Cost of Mtce 2007 $ 2,162 Profit/(Loss) 2007 Purchase Price $ (229.23) $ 11,000.00 (2,162.00) 118,379.60 Total Mtce Cost (Acc) 2007 $ 160,681.00 148,069.00 8451 Very Poor 6.00 (6.00) 36,105.89 21,807.00 24049 17968 Fair Fair 32.72 585.00 (32.72) 45,845.00 120,599.00 (585.00) 232,531.52 157,378.00 12773 9 Fair 203.38 1,352 (1,374.34) 120,176.00 193,932.00 3615 157 Fair 4,897.14 732 (379.04) 115,000.00 54,838.00 Ministry of Transport, Works & Energy Section 26: Page 27 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 REG NO.
Type of Plant Age 5 4 4 19 13 26 GM864 GN014 GN030 GK890 GM027 GJ543 GJ535 Total Cat Grader Cat Grader Cat Grader Ford Tractor JCB BackHoe 1H1 K250 Crane Dynapac Roller State 3rd Qtr Total Hrs (Acc) 2007 3rd Qtr (Km) 2007 3488 25 Fair Cost of Fuel & Oil 2007 $ 892.80 Cost of Mtce 2007 $ 240 Profit/(Loss) 2007 Purchase Price $ (408.65) 115,000.00 $ Total Mtce Cost (Acc) 2007 $ 23,986.00 4912 128 Fair 4,128.92 2,184 ($691.36) 128,000.00 45,873.00 3102 10 Fair 1,051.77 2,068 (2,757.69) 128,000.00 30,468.00 9762 20 Fair 16291 7 Fair 18074 Fair Fair 26 22219 148.46 224.38 282.00 424 744 216 (424.03) 21,365.00 24,724.00 (772.76) 68,098.00 72,300.00 (498.00) 154,131.00 273,852.00 6 (6.00) 40,720.00 69,362.00 12,681.80 10,128 (10,326.82) TABLE 26.19: VEHICLE THAT INCUR LOSS FOR THE 3RD QUARTER REG NO.
Type of Vehicle Age Total Mileage (ACC) (Km) 2007 205550 6255621 314,407 49844 58914 234,281 498,023 342963 239684 250283 202390 244190 171,666 185,355 126,140 Gl 379 GK813 GL 518 GL 444 GL 684 GL 917 GL 715 GL 176 GM 241 GM 222 GK 846 GM 051 GM 388 GM 871 GN 046 Total 14 19 17 17 Toyota Liteace Mitusbish Pajero Nissan Twin Cab Mitsubishi L200 M/Bus 19 Daihatsu F/Top 14 Toyota Corona 19 Daihatsu T/Cab 18 Nissan Tip Truck 12 Isuzu Tip Truck 12 Mitsubishi T/Truck Hino Service Truck 19 12 Isuzu Hoist Truck 10 Mitsubishi Pajero 5 Mitsubishi Pajero 4 Mitsubishi Pajero State Cost of Fuel & Oil Cost of Mtce 2007 Profit & (Loss) 2007 Purchase Price Total Mtce Cost (Acc) Poor Poor Poor Poor Poor Fair Poor Poor Fair Poor Poor Fair Good Good Good --- --- (6) (6) 6.00 6.00 --- --- (6.00) (6.00) (6.00) (6.00) 15,665.00 19,053.00 F.M.F Veh 17,871.00 --- 130.72 --- --- --- 6.00 283.52 --- 1,130.73 1,943.19 1,062.30 12 276 6 6 733 3,883 241 12 4,640.88 1,000 3,537 (12.00) (23.77) (6.00) (6.00) (733.00) (3,889.00) (276.56) (12.00) (3,154.90) (675.21) (1,319.45) (10,125.89) 12,079.14 22,632.00 18,687,.62 58,528.00 73,275.90 94,518.06 106,215.53 97,573.59 79,860.00 Project Vh 72,500 18,773 36,948 15,433 22,817 3,825 39,235 78,674 93,119 54,933 47,542 50,398 33,747 4,640 15,286 20,899 Audit further noted that the maintenance and operation cost for some of the vehicles shown in the table above had exceeded the vehicles initial purchase price.
26.18.4 “Idle” Vehicles and Plants “Idle” vehicle and plants are those vehicles and plants that are not in operation and which are not generating any income.

Hence for idle vehicles and plants, no other cost should be incurred towards it.

Section 26: Page 28 Ministry of Transport, Works & Energy REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Audit of the 3rd Quarter report revealed that majority of plants and vehicles were idle for the 3rd Quarter.
Refer to Appendix 26.3 and Appendix 26.4 respectively for details.

Overall, the above findings show the unproductive and inefficient management of government’s vehicle resources by the Plant Pool to ensure maximum return to government.

Recommendation • The Ministry should review the road worthy conditions of vehicles that failed to meet the requirements of the government vehicle policy.
• The Ministry should continue to propose to the Ministry of Finance to re-evaluate the plants • and vehicles hire rates.

Proper planning and supervision should be carried out to ensure that funds are spent economically on government plants and vehicle.

• An internal investigation should be carried out on why fuel and oil costs were still incurred despite the vehicle and plant being idle or not operating.
• All vehicles and plants that are uneconomical should be written off and removed from the Plant Pool Garage.

Department’s Comments The Audit recommendations are noted and management will ensure compliance.
26.19 Overspending – Electrical Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.28 The Electrical Services has been providing services towards the expansion, maintenance and operation of all Government buildings and power stations.

Audit noted that some of the electrical and maintenance works were overspent in the Central Eastern Division.
Refer details of electrical work which were overspent in 2007.

TABLE 26.20: ELECTRICAL UNIT OVER EXPENDITURES - 2007 Works Type Job No.
Description IDC 44025191011840401161057 44025191011840401161032 1405029521402010111018 14050229521208042211010 44025191011840401161043 Sila Central High School Sila Central High School Adi Cakobau School Adi Cakobau School Fiji College of Advance Education – Bldg 57 Total Allocation $ 8,000 Total Commitment $ 10,283 $ (2,283) Balance % Completion 15,000 16,787 (1,787) 35,000 37,527 (2,541) 7,000 3,000 7,300 (300) 3,791 (791) 100 100 100 100 100 28 Finance Instruction 18 Ministry of Transport, Works & Energy Section 26: Page 29 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Works Type Job No.
Description 44025191011840401161040 44025191011840401161044 44025191011840401161041 Fiji College of Advance Education -Bldg 5 Fiji College of Advance Education -Bldg 2 Fiji College of Advance Education -Bldg 3 CWMH – Lau Ward 44025191011840401161119 10 H – Veiuto 1405029521408022911006 441025191011840401161030 10 H – Veiuto 10 H – Veiuto 44025191011840401161029 Koronivia Group 5 1405029521408022911005 Group Maintenance Total Total Allocation $ Total Commitment $ 500 658 $ (158) Balance % Completion 3,000 3164 (164) 96,500 96,540 (40) 19,500 15,000 6,344 1,000 8,000 20,774 15,381 8,294 1,406 84,912 (1,274) (381) (1,950) (406) (4,912) (16,987) 100 100 100 100 100 100 100 100 The above findings show poor financial management by the division’s management and failure to adhere to the requirements of the Finance Instruction.
Recommendation The Ministry should ensure proper planning of electrical unit maintenance program to avoid over expenditures.

Department’s Comments The Audit’s recommendation is noted and management will urgently formulate plans to address this issue.

DIVISIONAL ENGINEER WESTERN 26.20 Plant Hire 26.20.1 Uneconomical Plants and Vehicles “Uneconomical” plants and vehicles are those that are no longer in a state where it should be running.
Hence for uneconomical plants and vehicles, no other costs should be incurred towards it.

Proper planning and supervision should be carried out to ensure that these vehicles are properly maintained and ready to be boarded.29 An analysis carried out on the fleet of plants and vehicles at the Divisional Engineer Western revealed the following concerns.
• Of the 157 vehicles and 83 plants maintained and operated by the Division, a total of 47 vehicles (30%) and 53 plants (64%) were in an uneconomical condition as at 30 June 2007.30 • The uneconomical plants and vehicles recorded oil, fuel, and maintenance costs despite recording zero hours of operation as at the 2nd quarter of 2007.

Refer details provided.

29 Board of survey – Process whereby all status of government stores and inventories are counted and /checked.
Recommendations are made during the board of survey where all uneconomical items are recommended to be written off.

30 PWD Uneconomical Vehicle & Plant Report, 30 June 2007.
Ministry of Transport, Works & Energy Section 26: Page 30 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 TABLE 26.21: COSTS INCURRED ON PLANTS THAT WERE UNECONOMICAL AS AT THE 2ND QUARTER OF 2007 Type of Plant Registration Number Station Age Tractor Tractor Ford Loader Ford Loader Loader Cat Loader TCM Loader JCB Loader JCB Roller Bomag GL438 GL439 GJ523 GK699 GK209 GK835 GK711 Plant Pool Plant Pool Workshop Workshop Auction Workshop Workshop Bomag Roller GM035 Workshop Self Propelled Vib Roller Road Grader GL604 GK483 Nadi Roads Workshop Status Certificate of Road Worthiness No./Date Total Hours at end of 2nd Quarter (Hrs) 0.00 21/3/90 Uneconomical 0.00 8/3/90 Uneconomical 0.00 4/9/81 Uneconomical 0.00 264/88 Uneconomical 0.00 5/2/84 Uneconomical 0.00 31/8/88 Uneconomical 0.00 10/6/88 Uneconomical 0.00 20/1/94 Uneconomical 0.00 22/8/91 Uneconomical Cost of Fuel/Oil $ Cost of Maintenance $ 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5.00 5.00 5.00 58.00 15.00 10.00 10.00 126.00 15.00 23.00 13/4/02 Uneconomical 588.55 2,694.00 15 15 24 17 21 17 17 10 23 20 TABLE 26.22: COSTS INCURRED ON VEHICLES THAT WERE UNECONOMICAL AS AT THE 2ND QUARTER OF 2007 Registration Type of Vehicle Station Age Total Mileage Certificate of Road Condition Cost of Fuel& Oil Cost of Maintenance $ GK816 GK803 GK430 GI771 GL167 GL168 GJ627 Mitsubishi Pajero S/Wagon Toyota LN65 4x4 Utility Mitusbishi Canter F/Top Hino LB H/Crane F/Top Nissan CKB31 EDN Tipper Nissan CKB31 EDN Tipper Hino Field Service Truck
 Workshop 18 Defective Expired Uneconomical Ba W/Supply Plant Pool 18 Defective Expired Uneconomical 19 Defective Expired Uneconomical Plant Pool 25 Defective Expired Uneconomical 0.00 0.00 0.00 0.00 30.00 128.78 30.00 113.82 Sigatoka Roads Lomolomo 16 Defective Expired Uneconomical 0.00 5.00 16 Defective Expired Uneconomical 1,504.42 2,057.62 Workshop 21 Defective Expired Uneconomical 0.00 10.00 Audit further noted that of the 110 vehicles that were currently operational, 56 or 51% had defective mileage meters.
26.20.2 Expired certificate of road worthiness Each year, every vehicle is tested for road worthiness and issued certificate of road worthiness.

Ministry of Transport, Works & Energy Section 26: Page 31 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 As at 30th June 2007, audit noted that 48 (44%) of the 110 vehicles that were fully operational at the Division were operating with an expired certificate of road worthiness.
26.20.3 Vehicles under Repair but incurring High costs of Fuel and Oil A vehicle “under repair” means that the vehicles and plants being garaged and repaired.

Hence, the maintenance cost should be increasing to show that the vehicles and plants were being repaired.

Audit noted that a few plants and vehicles that were being garaged, incurred high oil and fuel costs in comparison to maintenance costs.

Refer details provided.
TABLE 26.23: PLANTS UNDER REPAIR BUT INCURRING HIGH FUEL AND OIL COSTS Registration Number Type of Plant Station Age Status Certificate of Road Worthiness No./Date Cost of Fuel/Oil $ Cost of Maintenance $ Total Hours at end of Quarter (hrs) 0.00 Workshop 10 07/02/94 Under Repair 6,000.37 Lomolomo 26 0.00 15/01/79 Under Repair 2,125.14 Workshop 11 323.50 01/02/94 Under Repair 3,562.91 29.59 226.70 193.00 GM021 GI013 GM040 JCB Backhoe Roller Dynapac Bomag Vibrating Roller Cost of Fuel& Oil ($) 305.81 Cost of Mtce.
($) 318.94 TABLE 26.24: VEHICLES UNDER REPAIR BUT INCURRING HIGH FUEL AND OIL COSTS Registration Type of Vehicle Station Age Total Mileage Road Certificate Status GL229 GL249 GK152 GL988 GL989 GJ919 GK826 Mitsubishi Pajero S/Wagon Mitsubishi Pajero S/Wagon Mazda 1600B Utility Toyota Hilux Utility Twin Cab Toyota Hilux Utility Twin Cab Daihatsu V20 F/Top Hino FS Tipper Workshop 18 Defective Expired Under Repair Lautoka Roads Water Rates Workshop 5 Defective Expired Under Repair 527.88 328.49 21 Defective Expired Under Repair 401.68 279.50 12 Defective Expired Under Repair 586.76 767.69 Workshop 12 Defective Expired Under Repair 90.74 0.00 Lautoka W/Supply Plant Pool 122 Defective Expired Under Repair 783.88 117.75 17 Defective Expired Under Repair 286.23 15.00 The high fuel cost as shown in the tables above could indicate that such vehicles were being used for unauthorised purposes while being garaged.
Furthermore, the possibility of malpractices would not be ruled out given that the plants and vehicles were under repair and not operational.

Recommendations • Proper planning and supervision should be made to ensure that funds are not unnecessarily spent on vehicles and plants that are uneconomical or under repair.
Ministry of Transport, Works & Energy Section 26: Page 32 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • An internal investigation should be carried out on why fuel and oil costs incurred were more than maintenance costs for vehicles and plants that were under repair.

It should also find out why oil, fuel, and maintenance costs were incurred even though the plants and vehicles were uneconomical and recording zero hours of operation.
• All vehicles and plants that were uneconomical should be boarded, written off and removed from the Plant Pool Garage since they were taking unnecessary space.

• The Ministry should ensure that all operational plants and vehicles should have a renewed and valid certificate of road worthiness.

Department’s Comments As per table 8.1 the following plants: GL438, GL439, GJ523, GK699, GK209, GK835, GK711, GM035 and GL604 JRS were issued to carry out minor repairs.
As for GK483, Tires worth $2111.82 and a hydraulic hose worth $296.00 were purchased.

The plant was operational for a week and consumed 260 liters of fuel.

A minor oil leak was then detected and the plant was sent for repairs.

As per table 8.2 Four new tires to the amount of $1827.00 were issued to vehicle GL168 mentioned in table 8.2.

The clutch plate, pressure plate and release bearing were also replaced in the second quarter.

This vehicle operated from April to May and broke down in June.
Vehicles that are operational have valid road fitness certificates.

Only vehicles that have been in the garage for a long time and not in use have expired road fitness certificates.

As per table 8.3 the following plants The clerk preparing the report for the second quarter had erred in entering data in relation to the total fuel cost for GM021, GI013 and GM040.
Verification of the checklist for plants showed that Fuel and oil consumption for GM021are as follows GM 021 Diesel – 200 liters ($ 294.00) Hydraulic Oil – 65 liters ($261.30) GI031 – No fuel consumption recorded in the checklist GM040 – 1821 liters ( $2676.87) The clerk has been advised to provide correct reports and ensure that this miscalculation does not occur again As per table 8.4 reasons for the usage of fuel are noted below.
GL229 – Operational from 07/06/07 to 27/06/07 Operational hours – 111 hours Fuel consumption - 214 Liters ($314.58) GL249 – Operational from 30/05/07 to 27/06/07 Operational hours – 315.25 Fuel consumption – 761 liters ($1118.67) GK152 - The fuel cost noted in the second quarter report was recorded in error.

This amount was for the first quarter as the vehicle was operational.

However the fuel usage was not recorded.

This vehicle was also involved in an accident on 23/03/07 and put into the workshop.
GL988 – Operational hours from 02/05/07 to 25/06/07 Operational hours – 291.75 hours Two new tires and a tube totaling $673.24 were also purchased.
Ministry of Transport, Works & Energy Section 26: Page 33 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 GJ919 – Operational from 03/04/07 to 19/04/07 Operational hours – 112 hours Fuel consumption – 440 liters ($646.80) GK826 – Operational hours – 29.5 hours This vehicle is fitted with a big 6L V – 8 engine and fuel consumption is high.

The Audit recommendations are noted and management will ensure compliance and action appropriately.
26.21 Quarters - Rent Deduction Not Effected With the exception of those officers specified in GO 601, all officers occupying government quarters of whatsoever grade or type or self contained flats, will be required to pay rent at the rate of eight percent of basic salary with maximum limits of rent for different grades of quarters as follows: special grade $1,600 per annum, Grade I and II $1,400 per annum, Grade III $1,200 per annum, Grade IV $1,000 per annum, Grade V $720 per annum, Grade VI and below $480 per annum.31 Audit noted that Officers provided with government pool quarters were not paying rent to government as required under GO 601.
Refer Table 26.25 for details.

TABLE 26.25: QUARTERS OCCUPANT NOT PAYING RENT Quarters Grade V V VI V IV Total EDP No.
Tenant Post 64654 61909 64099 64216 Nemani Dolodai L Doughty Titilia Vueti Venina Tulele Virisila Ladise Forest Guard Snr Technical Assistant Agricultural Assistant Dental Therapist Legal Officer Department Forestry Quarantine Quarantine Health DPP’s Office Date Deduction not effected 25/01/04 20/03/04 28/02/05 29/06/07 30/05/06 Revenue Loss $ 2,682.26 2,520.00 1,280.00 249.99 916.63 7,648.88 The above clearly shows laxity on the part of the Divisional Engineer, Commissioner Western Office and Districts Housing Committee Board in ensuring the proper authorities are advised so that rental deductions could be effected.
The above has resulted in loss of revenue to government.

Recommendations • The Ministry should advise the Ministry of Finance to pursue the option of deducting at source.

• The Divisional Engineer should liaise with the Commissioner Western’s Office to ensure that the policies and procedures laid down in the General Orders are complied with for the operation of government pool quarters.
• The Ministry should also liaise with the Public Service Commission and the Ministry of Finance to ensure proper rental deduction on occupants of government pool quarters.

Department’s Comments The department sends out occupation and vacation slips to the respective salaries section of the officer’s ministries concerned and also to the Finance section.

It is the responsibility of the various ministries to ensure implementation of the deductions.
31 General Order 607 Ministry of Transport, Works & Energy Section 26: Page 34 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The quarters clerk will also liaise with Commissioner Western’s Office and ensure that all rent due is deducted.

The district offices will be notified by the quarter’s clerk to inform the Divisional Engineer immediately on any occupation and vacation in the division.
The ministry will also liaise with the Public Service Commission and determine the correct rent required by each office to be deducted.
26.22 Accident committee’s recommendation not carried out effectively The Engineer Plant Pool shall carry out an investigation before recommending a course of action against driver involved in an accident and the drivers involved in the accident may be surcharged if the surcharging authority believes that the driver was at fault.32 The accident committee was established to carry out an investigation after all accidents and to submit recommendations on who is liable for the damages caused in the accident.
Discussion held with Officer responsible for accident to government vehicles revealed that recommendations made by the accident committee were not implemented promptly.

Refer to tables below for details.


TABLE 26.26: ACCIDENT COMMITTEE RECOMMENDATION FOR DRIVER’S SURCHARGE Date in register 11/01/07 06/02/07 19/02/07 19/02/07 23/03/07 07/08/07 23/08/07 03/09/07 Total Driver EDP/FNPF # Vehicle Decision by committee Aisea Livaiono Pauliasi Senikau Ravendra Prasad Changum Naidu Nand Kumar Raj Kumar Jotame Driu Adriu Niudamu 60911 KJ 654 FC 598 OV 748 DX 903 DD 623 OA 835 BR 602 No.
GK 817 GL 987 GM 048 GK 769 GK 152 GN 404 GM 236 GM 263 100%surcharge against driver 100%surcharge against driver 50% surcharge against driver 100%surcharge against driver 80%surcharge against driver 100%surcharge against driver 100%surcharge against driver 100%surcharge against driver Amount $ 2,705.00 140.00 180.00 250.00 2,100.00 140.00 185.00 70.00 5,770.00 TABLE 26.27: ACCIDENT COMMITTEE RECOMMENDATION FOR 3RD PARTY’S SURCHARGE Date in register 15/01/07 09/02/07 18/04/07 Driver Satendra Kumar Chand Basant Kumar Filimoni Botitu EDP/FNPF No.
PP370 FJ 582 EA 740 Vehicle No.

GN 370 GN 375 GN 253 Committee Decisions Third party to pay firm price of $9,375.75 Third party to pay firm price of $50 Third party to be charged for the damages Amount $ 9,375.00 50.00 250.00 For the above cases, audit noted that the drivers were not surcharged nor did the Ministry take legal actions against the 3rd party for the damages caused.
The failure of the Ministry to implement the recommendation of the Accident Committee could result in the non recovery of the costs of accidents on government vehicles.
32 Ministry of Works Finance Manual 2005 S12.6.5 & S12.6.7 Ministry of Transport, Works & Energy Section 26: Page 35 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation The Ministry should ensure the prompt implementation of the recommendation of the Accident Committee so that the costs of accident to government vehicle are fully recovered promptly.
Department’s Comments The accident committee in the West investigates the accident cause and recommends for the actions to headquarters for the signatory of the Permanent secretary.

From headquarters it is submitted to the Attorney General’s office for the judgement on the recommendation.

The drivers are given 28 days to appeal for their case.

Once it is finalised it is forwarded to the Ministry of Finance for deduction of wages.
This takes many months and up to a year to be done and in past cases, some drivers have retired by the time a decision is finally made.

Some quicker way must be designed to safeguard assets.
DIVISIONAL ENGINEER EASTERN 26.23 TMA Business Plan Not Prepared Before the end of October each year, the TMA Manager shall prepare a draft business plan documenting the planned performance and profit target for the following year.33 Audit noted that the last business plan prepared was in 2005.The business plans for 2006 and 2007 were not prepared.
Without a proper business plan, the benchmark of measuring the actual business performance and profit cannot be measured against those planned, performed and profit targets and to evaluate its efficiency and productivity.

Recommendations • The TMA manager should ensure that the business plans are prepared before the end of October and present the draft business plan to the CEO and senior management in the first week of November as required under the Finance Instruction.
• Once approved, the TMA manager should inform the staff what is required of them to achieve the targeted performance level.

Department’s Comments Steps are being taken now to produce the Business Plan which should be completed before end of September2008.The DE Works (West) is assisting the DE Works (Central) in the formulating of Business Plan for each TMA.
33 Finance Manual 2005, 6.1.1 Ministry of Transport, Works & Energy Section 26: Page 36 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DIVISIONAL ENGINEER NORTHERN 26.24 Trading and Manufacturing Account Anomalies 26.24.1 Unutilised Stocks – Plumber shop TMA Within 3 days after the end of the stock take, the stocktaking officers must prepare and sign a stock take report and submit it to the TMA manager, with a copy to the accounting head.
The report must outline; any discrepancies between actual stock and supporting records, whether any stock is obsolete or unserviceable, explanations from the stock- keepers if relevant.34 Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.35 The Plumber Shop TMA was manufacturing concrete water meter box for the Department of Water in the Northern Division to be used for newly installed meters.
Audit noted from the Plumber Shop Trading Account that the concrete water meter box were not utilised.

Moreover, the stock cards for concrete meter box noted a balance of 63.

Discussion with the storeman where audit noted that the Department of Water had ceased using concrete meter box and have replaced this with plastic meter box purchased from Vinod Patel.

Audit further noted that 5 Smokeless Stoves was manufactured but not sold or utilised as projected.
The Department purchased resources from outside suppliers instead of those produced by the Plumber Shop.

This has resulted in losses of government as items produced within the department have remained unsold.

Recommendation The Ministry should review the Plumber shop TMA operation and put in place strategy in order to ensure that profit is maximized.

Otherwise, the operations should cease.


Department’s Comments As highlighted by the Auditor General, those unutilized stocks manufactured at Plumber Shop especially the concrete meter box were from years back and were assigned especially for the Water Supply Department.

The manufacturing of these concrete meter box were made in bulk when all sections came under one umbrella of the Ministry of Works and Infrastructure.
However with the separation and the introduction of the more sophisticated meter box and more importantly the new OHS regulation, the plastic meter box was needed instead of the old ones.

26.24.2 Arrears of Revenue – Electricity Charges The accounts officer must promptly follow up accounts that fall due.
If recovery is unsuccessful after one month, the following actions shall be taken:36 34 Finance Manual s6.3.5, pp 52 35 Finance Instruction 18 36 Finance Manual 2005 9.2.1 Ministry of Transport, Works & Energy Section 26: Page 37 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 i. ii.

iii.
iii.

no further credit shall be extended to the debtor; a demand notice for payment shall be sent to the debtor after his/her debt has been overdue for more than one month; if the account still remains unpaid after the first demand notice was issued, a final notice shall be issued demanding payment within fourteen days.
If a final notice had been issued to one of the debtors listed, the accounting head may approve that the case be referred to the Solicitor General or the Small Claims Tribunal, after considering the cost implications and the probability of recovery.37 Audit of the revenue records at Nabouwalu Depot revealed substantial arrears of revenue for electricity amounting to $248,375 as at November 2007.

Similarly, the revenue records for Taveuni Depot shows arrears of revenue of $82,520 as at 6/08/07.
Clients with outstanding arrears include government stations, civil servants, private businesses, private household and villagers.
The officer in charge disclosed that the following factors contribute to the high arrears: • pool quarters vacated by government officers without complying with the vacation procedures to ensure that tenants settle their bills upon vacation; • billing of consumers which used to be made by Depot Supervisors are now back with Labasa office; • defective meters still being supplied with electricity; • lack of funds for installation of new meters and • tenants are billed on a quarterly basis instead of monthly.
Audit further revealed that 57 of the 195 consumers at Nabouwalu had defective electricity meters but were still being supplied with electricity from the depot’s generator.

The above issue was also highlighted in the 2005 report and at the date of audit in November 2007, no action has been taken by the Department.

The above findings reflect the failure by the Department and the officers responsible to instigate appropriate debt recovery procedures.
Losses to government will continue if the above is not rectified.

Recommendations • The department should pursue recovery measures to ensure that the arrears of revenue in respect of electricity charges for Nabouwalu Depot and Taveuni Depot are reduced.

• The department should comply with Finance Manual in respect of debt recovery procedures.
Departments Comments The Arrears of Revenue are not correct since the reading done at Nabouwalu was not accurate due to some technical error in reading thus increasing the amount to $ 248, 375.45.

As for Taveuni a more vigorous exercise was done whereby defaulting consumers electricity meters were disconnected on the 30.04.08 by a special task team assembled with the assistance from the Ministry of Finance, Internal Audit team.
As for Nabouwalu a similar exercise is undertaken whereby disconnection is made on all defaulting consumers.
37 Finance Manual 2005 9.2.4 Ministry of Transport, Works & Energy Section 26: Page 38 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 26.1: Cancelled LPO to NBTL Cancelled LPO’s to National Bulldozing – Nadroga Depot Requisition Number 159418 169638 169639 169640 169641 169592 169663 LPO Date 07/03/07 24/02/07 24/05/07 24/05/07 24/05/07 LPO Number 715871 724199 724199 724199 724199 18/04/07 12/06/07 724105 755438 169664 12/06/07 755438 169769 02/07/07 755730 169836 169866 169870 169885 169889 27/07/07 06/08/07 06/08/07 724277 724294 724298 09/08/07 09/08/07 757358 757362 169906 16/08/07 757372 169902 16/08/07 757370 169511 18/04/07 724114 169417 02/05/07 724153 169418 02/05/07 724154 169606 14/05/07 724174 169607 14/05/07 724175 Total Particulars Hire of Tipper Truck CM786 Hire of Tipper Truck EX 221 (17/5-23/5) Hire of Tipper Truck CN830 (17/5 -23/5) Hire of Medium Excavator EG 367 (17/5 – 23/5) Hire of Medium Excavator DU 565 (17/5 – 23/5) Hire of Tipper Truck EX 221 (05/4 – 11/04) Hire of Tipper Truck EX 221 (24/5 -30/5) Hire of Tipper Truck CN 830 (24/5 -30/5) Hire of Excavator DV 565 (21/06 -27/06) Hire of Medium Excavator DV 565 (19/7 – 25/07) Hire of Medium Excavator DV 565 (26/7 -01/08) Hire of Tipper Truck CN 830 (26/7 -01/08) Hire of Medium Excavator DU 565 (02/8 – 08/08) 44hrs Hire of Tipper Truck CN 830 (02/08 -08/08) Hire of Tipper Truck CN 830 (09/8 -15/08) Hire of Excavator DV 565 (09/08 – 15/08) Hire of Tipper Truck EX 221 (12/4 -18/4) Hire of Tipper
 Truck CM786 (3/05 -09/05) Hire of Tipper Truck EX 221 (03/05 -09/05) Hire of Tipper Truck CM786 (10/5 -16/5) Hire of Tipper Truck EX 221 (10/5 -16/5) Amount $ 177.40 616.00 616.00 1,122.00 1,122.00 616.00 616.00 616.00 1,122.00 1,122.00 1,122.00 616.00 1,122.00 616.00 616.00 1,122.00 616.00 616.00 616.00 616.00 616.00 16,039.40 Appendix 26.2: Vehicles Exceeding 200,000km Mileage Vehicle # Registration Date Price $ GL917 GL 941 GM 176 GM 177 GL 379 02-Aug-93 01-Oct-93 15-Mar-95 15-Mar-95 12-Dec-89 $22,632.00 $24,000.00 $16,661.05 $16,661.05 $15,665.00 Ministry of Transport, Works & Energy Mileage as at 3rd Quarter 2007 $ 234281 217143 535040 200262 205550 Maintce.
Cost (Acc) 2007 $ 39,235 17,642 21,952 33,743 18,773 Total Fuel Cost 2007 $ 130.72 641.52 910.30 855.39 Actual M/Cost 2007 Total Income 2007 Profit / (Loss) 2007 Age Of Vehicle (years) $ 276.00 72.00 72.00 154.00 6.00 $ 382.95 1,531.82 3,328.75 2,356.64 0.00 $ (23.77) 818.30 2,144.60 1,268.36 (6.00) Section 26: Page 39 14 13 12 12 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Vehicle # Registration Date Price $ GK 813 GL 226 GL 228 GL 956 GL 975 GL 976 GL 497 GM 798 GK 775 GL 201 GL 202 GL 964 GL 990 GK 755 GK 789 GL 219 GL 968 GL 985 GL 529 GL 518 GL 742 GL 745 GL 747 GL 748 GL 883 GL 884 GN 114 GN 136 GN 291 GK 682 GK 683 GK 713 GK 714 GK 715 GK 844 GK 845 GJ 488 GL 422 GL 423 GM 194 GL 055 GL 303 GL 344 GL 346 GM 188 GL 174 GL 176 GM 239 GM 241 GM 242 GM 243 28-Jul-88 21-Sep-89 21-Sep-89 20-Oct-93 24-Oct-95 24-Jan-95 04-Apr-90 21-Dec-00 01-Jul-88 28-Sep-89 28-Sep-89 10-Nov-93 10-Nov-93 24-Jun-88 30-Jun-88 28-Sep-89 10-Nov-93 10-Nov-93 24-Mar-98 30-May-90 10-Jan-00 10-Jan-00 10-Jan-00 10-Jan-00 10-May-02 10-May-02 30-J un-02 30-Sep-03 18-Jan-05 15-Mar-88 15-Mar-88 27-Apr-88 27-Apr-88 27-Apr-88 08-Nov-88 08-Nov-88 22-Sep-81 16-Jan-90 16-Jan-90 18-May-95 03-Jul-89 28-Sep-89 31-Oct-89 21-Oct-89 23-Mar-95 28-Sep-89 28-Sep-89 16-Apr-95 16-Apr-95 16-Apr-95 16-Apr-95 $19,053.00 $16,985.00 $16,985.00 $38,010.89 $28,226.10 $28,226.00 $17,220.00 $59,685.00 $12,170.18 $11,241.12 $11,241.12 $16,079.91 $16,071.91 $16,215.16 $16,230.00 $13,741.45 $21,698.15 $21,698.15 Project Veh.
F.M.F.

Veh.

Project Veh.

Project Veh.

Project Veh.

Project Veh.

$35,250.00 $35,250.00 $36,205.00 $48,500.00 Project Veh.
$12,079.14 $12,079.14 $18,687.62 $18,687.62 $18,687.62 $50,026.00 $50,026.00 $10,741.00 $71,909.00 $71,909.00 $75,175.46 $28,500.00 $48,959.00 $21,229.00 $21,229.00 $73,725.00 $58,528.00 $58,528.00 $73,275.90 $73,275.90 $73,275.90 $73,275.90 Ministry of Transport, Works & Energy Mileage as at 3rd Quarter 2007 $ Total Fuel Cost 2007 $ 1,644.79 995.06 1,102.30 1,416.64 Maintce.
Cost (Acc) 2007 $ 1,484.
Actual M/Cost 2007 Total Income 2007 Profit / (Loss) 2007 Age Of Vehicle (years) $ $ $ (6.00) (6.00) 0.00 4,334.53 5,640.78 600.44 885.74 0 0.00 0 0.00 4,123.84 6,340.05 142.43 233.09 1,109.57 2,703.84 2,569.90 6,340.05 5,401.53 7,132.55 1,084.59 1,510.08 0 0.00 n/a #VALUE 0 0.00 (6.00) 0.00 767.20 2,232.80 1,465.27 3,620.76 289.02 1,025.88 4,324.71 6,759.32 3,511.82 5,086.22 1,173.18 3,680.82 0.00 0.00 0.00 0.00 8,138.48 9,053.04 0.0 0.00 2,646.27 3,347.34 0 0.00 (6.00) 0.00 1,296.26 1,825.82 (733.00) 0.00 4,718.04 6,086.08 3,676.03 4,412.41 Section 26: Page REPORT OF THE AUDITOR GENERAL OF THE
12 12 12 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Vehicle # Registration Date Price $ GK 830 GM 222 GM 223 GL 224 GJ 508 GJ 626 GK 846 GL 667 02-Aug-88 15-May-95 15-May-95 15-May-95 30-Nov-81 25-Jan-82 29-Aug-88 18-Apr-91 $78,956.00 $94,518.06 $94,518.06 $94,518.06 $15,332.00 $42,185.00 $106,215.53 $102,463.00 Mileage as at 3rd Quarter 2007 $ 360275 250283 209863 233282 322215 304031 202390 208171 Maintce.
Cost (Acc) 2007 $ 96,479 47,542 27,884 36,874 101,883 87,101 50,398 89,088 Appendix 26.3: Plants Lying Idle Total Fuel Cost 2007 $ Actual M/Cost 2007 Total Income 2007 Profit / (Loss) 2007 Age Of Vehicle (years) $ 3,883 $ 0.00 0.00 0.00 0.00 1,512.08 3,471.47 247.96 12,689.82 $ 0 (3,889) 0 0 226.49 2,478.52 276.56 6,278.56 19 12 12 12 26 25 19 15 457.59 884.26 283.52 5,959.26 378.00 18.00 241.00 380.00 REG NO.
Type Plant of Age GL 718 GJ151 GO062 GK906 GK907 GM089 GI 398 GJ 529 GJ531 GJ532 GK899 GK900 GJ 351 GK202 GL994 GM018 GM 058 GM 860 GK834 GM019 GJ543 GK739 GJ535 GJ573 GK477 GL603 Cat D7 Cat D6 Cat D6 Komatsu D6 Komatsu D6 Cat D6 Cat D4 Cat D4 Cat D4 Cat D4 Komatsu D4 Komatsu D4 M.F Loader Clark Loader TCM Loader Champion Grader Champion Graderl Cat Grader Komatsu Excavator Kato Excavator 1H1 Crane Bomag Roller Dynapac Roller Dynapac Roller Bomag Roller IngersolRand K250 30 34 30 19 19 13 27 26 26 26 19 19 18 23 14 13 13 5 19 13 26 19 26 26 21 17 3rd Qtr Total Hrs (Acc) 2007 130,910 27,371 361,939 13,580 10,628 9,326 47,160 18,388 15,335 20,108 12,571 117,718 8,451 24,049 17,968 13,909 8,704 4,270 15,803 81,548 18,074 9,242 22,219 11,181 10,246 12,191 Ministry of Transport, Works & Energy Condition of Plants 3rd Qtr (Km) 2007 Cost of Fuel & Oil $ Very Poor Fair Fair Very Poor Fair Good Poor Poor Poor Poor Fair Fair Very Poor Fair Fair Fair Very Poor Fair Fair Fair 229.23 --- --- --- --- --- --- --- --- --- --- --- 6.00 32.72 585.00 --- --- --- --- --- Cost of Mtce 2007 $ --- --- --- --- 2,162.00 --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- Profit & (Loss) 2007 $ (229.23) --- --- --- (2,162.00) --- --- --- --- --- --- --- (6.00) (32.72) (585.00) --- Purchase Price $ Total Mtce Cost (Acc) 2007 11,000.00 35,928.00 67,000.00 118,379.60 118,379.60 200,000.00 42,657.00 46,177.00 46,177.00 46,177.00 88,072.00 88,072.00 36,105.89 45,845.00 232,531.52 120,176.00 160,681 135,382 312,320 191,449 148,069
 84,802 137,605 290,203 202,984 168,027 72,970 126,362 21,807 120,599 157,378 112,725 --- --- --- --- 144,992.00 81,900 115,000.00 64,860.00 49,638 144,614 102,372.00 82,566 Fair 282.00 216.00 (498.00) 154,131.00 273,852.00 Fair Fair Fair Fair Fair --- --- --- --- --- --- 6.00 --- (6.00) 102,304.00 40,720.00 34,772.00 69,362.00 --- --- --- --- --- --- 47,661.00 107,257.00 68,027.00 84,912.00 122,109.00 62,719.00 Section 26: Page 41 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 REG NO.
Type Plant of Age Roller Bomag Roller Pile Drive Hammer Pile Hammer Gemco Rig Drive 13 - - - GM037 G41 G42 GM033 Total 3rd Qtr Total Hrs (Acc) 2007 11,295 0 0 0 Condition of Plants 3rd Qtr (Km) 2007 Cost of Fuel & Oil $ Cost of Mtce 2007 $ Profit & (Loss) 2007 $ Purchase Price $ Total Mtce Cost (Acc) 2007 Good - - - --- --- --- --- --- --- --- 1,134.95 --- 2,384.00 --- --- --- --- (3,518.95) 101,260.00 11,237.00 11,237.00 20,660.00 --- --- 90,000.00 562.00 Appendix 26.4: Idle Vehicle that were not in Operation REG NO.
Type of Vehicle Age Gl 379 GK813 GK 775 GK 777 GL201 GL 202 GK 784 GK 789 GL199 GL 518 GL 444 GL 429 GL 683 GL 684 GL 714 GL 715 GL 791 GK 887 Gk 888 GM 051 GL 055 GL 303 GL 346 GM 187 GM 865 GM 174 GL 176 GM 240 17 21 19 19 19 19 15 14 19 18 18 17 17 19 19 18 17 Toyota Liteace Mitusbish Pajero Toyota Utility Toyota Utility Nissan Utility Nissan Utility Toyota Hilux Toyota Hilux Nissan Twin Cab Nissan Twin Cab Mitsubishi L200 M/Bus Mitsubishi F/Top Daihatsu F/Top Daihatsu F/Top Daihatsu T/Cab Daihatsu T/Cab Daihatsu F/Top Mitsubishi H/Truck Mitsubishi H/Truck Isuzu Hoist Truck Mazda Hoist Truck 18 18 Isuzu Tip Truck 18 Mazda Tip Truck Mazda Tip Truck 12 Mitsubishi T/Truck 19 18 Nissan Tip Truck 18 Nissan Tip Truck 12 Isuzu Tip Truck 19 12 19 Total Mileage (ACC) (Km) 2007 205550 6255621 549902 139034 648178 593564 30110 455,603 574188 314,407 49844 88,891 399377 58914 667,390 498,023 112559 334 136441 244190 391093 515943 251036 165086 160177 251146 342963 103935 Condition Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Poor Fair Poor Poor Fair Poor Poor Poor Fair Poor Poor Poor Fair Cost of Fuel & Oil $ 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 6.00 6.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Cost of Maintenance $ (6.00) (6.00) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 12.00 0.00 6.00 0.00 Profit & (Loss) 2007 $ (6.00) (6.00) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 (6.00) (6.00) 0.00 0.00 (12.00) 0.00 (6.00) 0.00 Purchase Price
 $ Total Mtce Cost (Acc) $ 15,665.00 19,053.00 12,170.18 12,170.18 11,241.12 11,241.12 16,230.00 16,230.00 15,322.24 F.M.F Veh (12.00) 72,959.87 97,573.59 47,364.00 33,747.00 0.00 0.00 0.00 0.00 0.00 0.00 6.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 28,500.00 48,959.00 21,229.00 73,725.00 56,042.00 $58,528.00 $58,528.00 $73,275.90 67,339.00 44,465.00 35,696.00 4042.00 102,532.00 57,809.00 93,119.00 27,553.00 Ministry of Transport, Works & Energy Section 26: Page 42 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 REG NO.
Type of Vehicle Age GM 241 GK 830 GM 221 GM 222 GM 223 GM 224 GO Total 12 Isuzu Tip Truck Hino Tip Truck 19 Mitsubishi T/Truck 12 Mitsubishi T/Truck 12 Mitsubishi T/Truck 12 Mitsubishi T/Truck 12 Bedford Tow Truck 30 Condition Total Mileage (ACC) (Km) 2007 239684 360275 166270 250283 209863 233282 94362 Fair Fair Fair Poor Fair Fair Poor Cost of Fuel & Oil $ 0.00 0.00 0.00 6.00 0.00 0.00 0.00 301.52 Cost of Maintenance $ 733.00 0.00 0.00 3,883.00 0.00 0.00 0.00 4,905.00 Profit & (Loss) 2007 $ (733.00) 0.00 0.00 (3,889.0 0) 0.00 0.00 Purchase Price $ Total Mtce Cost (Acc) $ 73275.90 78,956.00 94,518.06 94,518.06 94,518.06 94,518.06 54,933.00 96,476.00 78,292.00 47,542.00 27,884.00 36,874.00 0.00 44,425.00 71,678.00 Ministry of Transport, Works & Energy Section 26: Page 43