Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697778478492.pdf (Fiji)
REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF FIJI 2017-2018 Financial Statements of Government & 2017-2018 Agency Financial Statements of Ministry of Economy PARLIAMENT OF FIJI PARLIAMENTARY PAPER NO.
186 OF 2020 LOCATION : Level 8, Ratu Sukuna House 2-10 MacArthur Street Suva, Fiji PO BOX : 2214, Government Buildings Suva, Fiji TELEPHONE : (679) 330 9032 EMAIL WEBSITE : info@auditorgeneral.gov.fj : www.oag.gov.fj CONTENTS Part A: Part B: Part C: 2017-2018 Government Financial Statements of Report on the Financial Statements of Government 2017-2018 Agency Financial Statement of Ministry of Economy Part A: 2017-2018 Government Financial Statements of Financial Statements Government of the Republic of Fiji for the period ending 31 July 2018 Schedules Description Page No.
Table of Contents Primary Financial Statement according to Cash Basis IPSAS Schedule 1 Schedule 2 Statement of Cash Receipts and Payments……………………...………………………… Statement of Comparison of Budget and Actual Amounts by Budget Funding Programme……………………………………………………………………...………..
Schedule 2A Statement of Comparison of Budget and Actual Amounts by Expenditure Economic classifications……………………………………………………………………………….. 1 2 3 Notes to and forming parts of the Financial Statements (Note 1 - 23)…………………… 4-21 Other Financial Statement required by law Schedule 3 Schedule 4 Schedule 5 Statement of Assets and Liabilities………………………………..……………...………..

Statement of Revenue and Expenses……………………………………………..………..

Statement of Contingent Liabilities ……………………………………………..………….
22 23 24 Notes to and forming parts of Other Financial Statements (Note 24 - 50)………..……….

25-46 Schedule 6 Segmentation Report by Fund Classification……………………………………...……….
47-48 Schedule 7 Summary of Revenue……………………………………………………………………… 49 Schedule 8 Detailed Revenue Comparison…………………………………………………………….. 50-56 Schedule 9 Statement of Expenditure against Appropriation Heads……………….………………….. 57-59 Schedule 10 Details of Expenditure Reportable Authorizations………………………………………… Schedule 11 Budget Result, Estimates & Projections…………………………………………………… 60 61 Schedule 12 Disaggregation of Actual Revenue and Expenditure by Economic Type………………….. 62-64 Schedule 13 Estimate and Actual Budget Result………………………………………………………… 65 STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS BY BUDGET FUNDING PROGRAMME FOR THE PERIOD ENDING 31 JULY 2018 Schedule 2 Expenditure Operating (Standard Expenditure Groups [SEG] 1-7) Operating (Pensions-SEG 11) Operating (Public Debt - SEG 12, 14, 15) Capital (SEGs 8-10) Value Added Tax (SEG 13) Total Expenditure Revenue Operating Receipts Investing Receipts Total Revenue Net Deficit 2018 Debt Repayments 2018 Gross Deficit 2018 Original 2018 ($) Revised 2018 ($) Actual 2018 ($) Variance 2018 % Net Deficit as a Percent of GDP Nominal GDP 4.5% 10,980,141,000 4.4% 11,348,969,414 Gross Deficit To be Financed From: Overseas Loans Domestic Loans 184,105,851 532,762,256 184,105,850 532,762,257 74,178,384 531,796,000 60% 0.2% 716,868,107 716,868,107 605,974,384 15.5% 2 STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS BY EXPENDITURE - ECONOMIC CLASSIFICATIONS FOR THE PERIOD ENDING 31 JULY 2018 Schedule 2A
 Original Revised Actual Variance 2018 ($) 2018 ($) 2018 ($) % 1.
Established Staff 2.

Government Wage Earners 3.

Travel and Communications 4.

Maintenance and Operations 5.

Purchase of Goods and Services 6.

Operating Grants and Transfers 7.


Special Expenditures Total Departmental Operating Expenditures Unallocable Operating Expenditures 11.

Pensions, Gratuities & Compassionate Allowances 12.
Charges on Account of Public Debt Total Unallocable Operating Expenditures 46,221,100 46,221,100 36,956,687 20% 308,070,269 308,070,269 291,503,011 5% 7% 354,291,369 354,291,369 328,459,698 Total Operating Expenditures 2,515,357,422 2,544,450,098 2,321,374,464 9% 8.

Capital Construction 9.

Capital Purchase 10.


Capital Grants and Transfers Total Capital Expenditures 195,588,180 104,079,505 1,479,314,949 158,649,943 95,881,526 1,497,850,459 102,877,892 75,674,702 1,201,859,721 1,778,982,634 1,752,381,928 1,380,412,315 13.
Value Added Tax 62,490,760 59,998,790 37,476,706 35% 21% 20% 21% 38% Total Expenditures 4,356,830,816 4,356,830,816 3,739,263,485 14% 3 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS FOR THE PERIOD ENDING 31 JULY 2018 1.

General Information The Republic of Fiji is a sovereign democratic state.
The principal activities of the Government are: (i) The administration of public financial affairs; (ii) The provision of goods and services required by its citizens; and (iii) The collection, management and use of public resources.

2.
2.

Significant accounting policies 2.1 Basis of Preparation The financial statements namely, the Statement of Cash Receipts and Payments (Schedule 1) and the two Statements of Budget and Actual Comparisons (Schedules 2 and 2A) are prepared on cash basis as per the requirement of Cash Basis IPSAS, Financial Reporting Under the Cash Basis of Accounting and the Cabinet decision 277 of 2010.
The notes to the financial statements form an integral part to understanding the statements and shall be read in conjunction with the primary statements.

Further to complying with Cash Basis IPSAS reporting, additional presentations and disclosures are also being made in line with the Financial Management Act 2004.

The Government has early adopted the Cash Basis IPSAS, Financial Reporting under the Cash Basis of Accounting issued in 2017 from 1 August 2017.
The accounting policies have been applied consistently throughout the period.

2.2 Reporting Entity The financial statements are for the General Government Sector of the Government of Fiji.

The financial statements encompass the reporting entity, Whole of Government ("WOG"), as specified in the Financial Management Act 2004.

The reporting entity includes all budget sector agencies and excludes Off-budget state entities, Government commercial companies and commercial statutory authorities.
The revenue and expenditure of these controlled entities have been excluded from the consolidated accounts in accordance with Cash Basis IPSAS, Financial Reporting under the Cash Basis of Accounting, in order to facilitate timely financial reporting.

A list of significant entities encompassed in the financial statements and the sectors in which they operate is shown in Note 16 to the financial statements.
The Constitution of the Republic of Fiji provides the framework for the conduct of the Government of Fiji.

The principal activities of the Government of Fiji are the administration of public financial affairs, the provision of health, education, defense, social protection, housing, recreational and cultural and general public services and economic management.
4 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS FOR THE PERIOD ENDING 31 JULY 2018 Significant Accounting Policies (continued…) 2.2 The legal form of the Republic of Fiji is a sovereign democratic State.

Authority for Government's raising of taxation, revenue or moneys is provided by Section 139 of the Constitution of the Republic of Fiji ("Constitution") and relevant specific law.
Authority for spending is provided in Section 141 of the Constitution and Appropriation made by law.

2.3 Presentation currency The presentation currency is Fiji dollars, the currency of the Government of Fiji and all values are rounded to the nearest dollar except when otherwise indicated.

Cash flows are converted to Fiji dollars using the monthly average exchange rate by the Reserve Bank of Fiji.

Amounts held in foreign currencies are converted using the spot rate on the reporting date.
2.4 Basis of Consolidation The financial statements are for the National Government of Fiji comprising of ministries and departments that are part of the Central Government budget including financial operations of these ministries that are outside the budget, such as Trade and Manufacturing Accounts and Trust Accounts as Intra-economic entity transactions, receipts and expenditures are eliminated on consolidation.
2.5 Comparatives Where necessary, amounts relating to prior years have been reclassified to facilitate comparison and achieve consistency in disclosure with current year amounts.

The prior year comparatives were initially reported under the superseded Cash Basis IPSAS framework.

The transition to the updated framework did not result in any restatements.

However, there were some reconfiguration of disclosures to comply with the requirements of the framework.
5 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 3.

Cash and cash equivalents Cash comprises cash at bank, short term demand deposits in overseas banks and cash on hand and other cash equivalents.

Demand deposits and cash equivalents consist of balances with banks and investments in short-term money market instruments.

Cash is mainly kept in the Reserve Bank of Fiji, commercial banks and cash registers.
All Government ministries and departments use overdraft accounts (drawings) for their operations and these are cleared on a daily basis to the Consolidated Fund Account of Government.

In addition, several ministries and departments operate and maintain their own bank accounts for monies held as trust and for those that operate quasi-commercial activities.

Funds held by overseas banks are for various Fiji embassies, Trade Missions, Overseas Pension Funds and JP Morgan accounts.
The balance of the Domestic Account is offset by the unpresented cheques outstanding for ministries and departments as of 31 July 2018.
Cash included in the Statement of Cash Receipts and Payments comprise the following amounts: Overseas bank accounts Domestic bank accounts Trust fund accounts Trading and Manufacturing Activities accounts Cash on hand and balances with banks 31 Jul 2018 ($) 19,537,799 92,434,840 161,050,199 13,630,893 286,653,731 31 Jul 2017 ($) 18,546,563 87,966,550 169,295,442 13,944,586 289,753,141 Included in cash and cash equivalents above are the Trust Fund Accounts totaling $161.1 million (2017: $169.3 million) which is set aside for a specific purpose.
The Trust Fund Account includes deposits, retention monies and Main Trust account that ministries and departments hold in trust.

4 Donations, Grants and Other Aid Cash receipts during the period included donations, grants and other aid provided by individual multilateral donor agencies donor agencies and non-Governmental organizations.

The amount of donations, grants and other aid does not include aid received during the reporting period in the form of proceeds from loans.
The proceeds of any aid received during the period in the form of loans are included in the amount of borrowings presented as a separate line item in the Statement of Receipts and Payments.

6 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 5.

Borrowings Borrowings comprise cash inflows from financial development partners.

institutions, bilateral, multilateral and 6.


Term Loans Term loan payments are loans made to state owned enterprises and students (scholarships) as part of Government on lending program.

Term loan receipts are the repayments received from the recipients of the loans and scholarships.

7.

Trust Fund Trust fund receipts comprises of funds which Government receives and holds on behalf of its designated beneficiaries.

8.
8.

Advance Receipts Income received in advance consists of cash deposits that Government has collected, but not recognized as revenue.

9.

Value Added Tax These are VAT payment made by Ministries/ Departments to Fiji Revenue & Customs Services during the year.

10 Interest Payments and Other Charges on Loans These are payments made during the year for interest on overseas and domestic loans as well as interest on Treasury bills.

11.
11.

Investment Receipts Government has a number of investments and the receipts from investing are mainly from dividends and interest on bank balances.

12.

Capital Payments These are payments made for capital construction, purchase of fixed assets and capital grants and transfers.

7 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PEROD ENDING 31 JULY 2018 13.
Special Expenditure Special Expenditure (SEG 7) relate to one off or unique projects of Government.

In 2018, there were altogether 351 special expenditure activities, listed below are the top 14 activities.
31 Jul 2018 31 Jul 2017 Activity Head of Appropriation ($) ($) Analogue to Digital Civil Service Reform Management Unit National Export Strategy Consul-General - Sydney Govt Contribution-Global Fund Global Fund Assistance Consul-General - Shanghai Volunteer Service Economy Population Census Attorney General Office Digital Government Transformation General Reserves (OPR & CAP) Miscellaneous Services 2018 General Election Expenses FJ Police Miscellaneous Services Peacekeeping Missions Military Tech Employment, Productivity and Workmens Compensation Industrial Relation Communication Miscellaneous Services Industry, Trade and Tourism Industry, Trade and Tourism Health and Medical Services Health and Medical Services Industry, Trade and Tourism Employment, Productivity and Industrial Relation Women, Children and Poverty Alleviation Communication Peacekeeping Missions Education, Heritage and Arts Miscellaneous Services Health and Medical Services Industry, Trade and Tourism Consultancy Payments Winter Clothing Other Setuup & Implementation Establishment of a Flight Simulator Outsourcing Micro and Small Business Grant Facility Child Protection Prog 13,306,160 7,718,924 4,746,907 3,397,060 2,854,949 2,000,000 2,000,000 1,906,604 1,593,661 1,500,152 1,429,514 1,334,859 1,251,916 1,174,129 4,143,881 --- 5,665,937 --- --- 2,581,690 2,008,448 --- --- 1,091,666 --- 1,702,719 1,188,748 --- --- 946,668 --- --- --- --- --- --- 46,214,835 1,217,069 924,560 2,763,596 917,431 3,292,520 4,055,753 32,500,686 Others (comprises of 337 activities across various Ministries in 2018) 42,031,611 35,362,528 88,246,446 67,863,214 8 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (Cont...) FOR THE PERIOD ENDING 31 JULY 2018 Undrawn Borrowing Facilities 14.
The total undrawn loan balance from current loan facilities with the World Bank - International Bank for Reconstruction and Development ('IBRD'), International Fund for Agricultural Development ('IFAD'), European Investment Bank ('EIB') and the Asian Development Bank ('ADB') was approximately $551.8 million as at 31 July 2018 compared to $310.5 million in the same period last year.

Loans undrawn from the World Bank amounted to $103.5million ($105.6 million - 31 July 2017).
IFAD amounted to $5.4 million ($5.2 million - 31 July 2017), EIB at $157.6 million while undrawn loans from ADB equal $285.3million ($199.7 million - 31 July 2017).
The loan amounts were converted to the Fiji dollar using the end of year exchange rate: USD/FJD=0.4759 and EUR/FJD=0.4066 Loan Account Total Loan as per Agreement Drawdown Capitalised Charges Loan Proceeds received Loans cancelled Undrawn balance available for future years Restricted Cash Fiji dollar equivalent as at 31/07/2018 A. Multi-lateral (USD millions) (USD millions) (USD millions) (USD millions) (USD millions) (FJD millions) (FJD millions) 2014 ADB - Transport Infrastructure Investment Project 2016 IBRD - Transport Infrastructure Investment Project 2016 IBRD - Pacific Regional Connectivity Program 2017 ADB-Urban Water & Sewerage Project LN 3512 2017 EIB - Urban Water & Wastewater Management Project 2018 IBRD- Fiscal Sustainability Climate Resilient DPL 2018 ADB - Sustained Private Sector-Led Growth Reform Program Total B. Multi-lateral 2015 IFAD - Fiji Agricultural Partnership Project Total TOTAL (EUR millions) (EUR millions) (EUR millions) (EUR millions) (EUR millions) (FJD millions) 3.1 3.1 0.00 0.00 0.0 0.0 0.00 0.00 2.20 2.20 1.1 1.1 5.41 5.41 551.82 9 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 15.
Undrawn Grant Facilities Donor Institution/Project Name Currency Total amount of approved grant 2018 Total grants received as at 31 July 2017 FJD (millions) FJD (millions) Total grants received as at 31 July 2018 FJD (millions) Undrawn balance as at 31 July 2018 FJD (millions) General Budget Support Direct Project Support FJD FJD 35.63 5.00 6.97 7.70 25.10 12.20 0.37 1.86 Notes: ■ General budget support - These are cash grants as provided in the Budget Estimates.
■ Direct budget support - This represent ad-hoc cash grant received and released directly for the project to the recipient agencies.

Undrawn balance - Balance of funds which are returned to Head 50 on 31 July 2018.

During this period, Government had complied with all the significant terms and conditions of external assistance loan and grant agreements.

16 Government Budgetary Sector All budget sector agencies are included in the consolidated financial statements.
The significant controlled entities are identified below: General Administration Office of the President Office of the Prime Minister Office of the Attorney General Ministry of Economy Ministry of iTaukei Affairs Ministry of Defence and National Security Ministry of Employment, Productivity and Industrial Relations Ministry of Foreign Affairs Independent Bodies Independent Commissions Ministry of Disaster Management and Meteorological Services Ministry of Justice Fiji Corrections Service Ministry of Communication Ministry of Civil Service Ministry of Rural and Maritime Development Republic of Fiji Military Forces Fiji Police Force Peacekeeping Missions Social Services Ministry of Education, Heritage and Arts Ministry of Health and Medical Services Department of Housing Ministry of Women, Children and Poverty Alleviation Ministry of Youth and Sports Higher Education Institutions 10 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 16 Government Budgetary Sector (Cont…) Economic Services Ministry of Agriculture Ministry of Fisheries Ministry of Forests Ministry of Lands and Mineral Resources Ministry of Industry, Trade and Tourism Ministry of Sugar Ministry of Public Enterprise Ministry of Local Government and Housing Ministry of Environment Infrastructure Ministry of Infrastructure and Transport Water Authority of Fiji Ministry of Waterways Fiji Roads Authority There were no acquisitions or disposals of controlled entities during the financial year.
11 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PEROD ENDING 31 JULY 2018 17.

Assets, Liabilities, Revenues and Expenses a) Revenue and Expenses The Government builds data on revenues and expenses of the reporting period on a modified cash basis.

The modified cash basis used by Government is further explained in Note 18 Original and Revised Approved Budget and Comparison of Actual and Budget Amounts in the Basis Differences section.
Accrued expenses comprise amounts due and payable for wages, salaries and rental and other costs.
Payables at reporting date are as follows: b) Accounts Receivable Tax receivables - IRD and Customs Accounts receivable - Trade Miscellaneous receivables c) Accounts Payable TMA Trade and sundry creditors Withholding tax Litigation claims VAT and Income Tax Refunds outstanding d) Borrowings The borrowings of the Government are listed below: Proceeds Domestic commercial banks Domestic insurance companies Domestic - Fiji National Provident Fund Domestic - Private Overseas development banks and similar lending agencies Total proceeds Repayments Domestic commercial institutions Overseas development banks and similar lending agencies Total repayments Treasury Bills Treasury Bills issued Treasury Bills redeemed Net proceeds from Treasury Bills 31 Jul 2018 ($) 31 Jul 2017 ($) 151,016,717 1,662,218 874,815 153,553,750 111,036,031 2,527,108 843,807 114,406,946 --- 688,789 --- 164,249,266 164,938,055 (115,020) 196,225 466,490 94,467,190 95,014,885 40,609,140 60,295,507 405,464,797 29,244,147 68,223,377 603,836,968 2,000,000 34,262,000 172,635,000 15,356,397 211,440,261 435,693,658 (160,729,000) (44,811,307) (205,540,307) (99,643,000) (49,336,100) (148,979,100) 266,499,499 (177,900,000) 241,600,000 (310,560,477) 88,599,499 (68,960,477) 12 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 18.
Original and Revised Approved Budget and Comparison of Actual and Budget Amounts The budget is approved on a cash basis by functional classification.

The approved budget covers the fiscal period from 1 August 2017 to 31 July 2018 and includes all entities within the general Government sector.

The budget deals only with the general Government sector which excludes other extra budgetary activities.
The general Government sector includes all Government departments - significant departments are included in the list of entities in Note 16.

The 2017 -2018 Appropriation Act 2017 was passed by the Parliament of the Republic of Fiji on the 13th day, of July 2017.

There was no supplementary budget issued during the year.
A number of changes occurred due to a Redeployment Exercise which was endorsed by Cabinet via Cabinet Decision 111 on 18th May 2018 and approved for the redeployment of funds in the 2017-2018 Budget to fund the different Cyclone Assistance Relief Effort (CARE) for Fiji’s initiative in this financial year.

Comparison of Actual and Budget Amounts Investing revenue shortfall The anticipated sale of Government assets did not take place for the financial year 2017-2018.
Government budgeted $371.8 million from sale of Government assets as investing receipts in the 2017- 2018 Budget, which was largely anticipated from the planned divestment of Energy Fiji Limited (EFL).
SEG 1: Established staff The cost savings for SEG 1 is mainly attributable to the following: i) During the 2017-2018FY, only 683 doctors were employed which led to 285 vacant positions resulting in a savings of $17,481,936; and ii) Due to vacant positions at the WoG level, which resulted in the low utilisation of funds for SEG 1.
SEG 2: Government wage earners i) The underspending is due to the vacant positions at WoG level which has resulted in the low utilisation of funds for SEG 2. ii) Ministry of Education significant savings were a strategic decision as there was anticipated over expenditure in SEG 1 and SEG 2 and to ensure that the Ministry was able to cushion the difference as much internally as it can.
SEG 3: Travel and communications The cost savings for SEG 3 were driven by lower than expected staff travels and control measures undertaken during the year.

SEG 4: Maintenance and operations This was a result of fuel consumptions fluctuations which was dependent on usage, breakdown, receipt of new vehicles resulting in reduced maintenance cost, number of requests for purchase of cooking gas cylinders and refrigeration, delay in payment of biomedical equipment service fees and incomplete services.
13 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 18.

Original and Revised Approved Budget and Comparison of Actual and Budget Amounts (Cont…) SEG 5: Purchase of goods and services i) As a result of lower than projected purchase of goods and services during the year.
ii) The reduced number of patients that were transported by ambulance, the low number of training courses for ambulance staff due to tight schedule of trainers, orders for kitchen equipment not processed due to non-availability of items from supplier and lack of storage space in kitchen, payments for appliances and dressings could not be made as the goods were not received in the current financial year, the tender for female shoes and uniform was re-advertised due to numerous complaints on specifications and additional funds of $7.2m vired into vaccines allocation to urgently accommodate the payments for the meningococcal vaccines.
Following the vaccination campaign, the allocation had unutilised funds.

SEG 6: Operating grants and transfers i) Judicial Department had savings of $16,434,945 in operating grant & transfer due to savings in established staff, special expenditure and capital construction.
The reason for established staff savings was due to 18 vacant posts for Judicial Officers that were not filled as at 31 July 2018, Special expenditure savings due to vacant Chief Tribunal, Legal Tribunal and Non-Legal Tribunal posts under employment Relations Tribunal, and Savings in Capital Constructions was mainly attributed to the low utilization rate of on-going projects and non-implementation of projects earmarked for the 2017/2018 financial year.
ii) Ministry of Economy Head 4 had savings of $10,413,143, in operating grant & transfer as a result of grants for Fiji Revenue and Customs Service was released on a need for funding.
SEG 7: Special expenditures The cost savings in this SEG were attributable to the delayed implementation of disaster reconstruction projects and General Election Expense-Fiji Election Office, General Election -Fiji Police, ADB Meeting and Financial Assistance towards TC Winston SEG 8: Capital construction The cost savings in SEG 8 were mainly attributable to construction works that were hindered by Tropical Cyclone (TC) Josie, TC Keni and TC Gita.
In addition, the budget released were based on the funding requirements to implement the programmes for the period reported.

Furthermore, the delay in the tender process for maintenance of Fiji Pharmaceutical and Biomedical Services property; and the delay in implementation of projects by the Department of ITC.
SEG 9: Capital purchase The significant cost savings in SEG 9 was mainly attributable to a number of purchases that were re- prioritized and delay in tender process for biomedical suppliers for urban hospitals and dental equipment and LMIS FPBS project was on hold as advised by higher authorities.
SEG 10: Capital grants and transfers Funding from these allocations are released as and when required; and due to redeployment of funds for different programmes under the CARE for Fiji Initiatives which includes Homes-Care, Farms Care, Sugarcane -Care, Leaseholder-Care, Welfare-Care and E-Transport-Care.

14 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 18.
Original and Revised Approved Budget and Comparison of Actual and Budget Amounts (Cont…) SEG 11: Pensions, gratuities and compassionate allowances The overall savings under SEG 11 was mainly attributed to deletion of pensioners due to death, non- submission of life certificates and expiry of contract of contracted officers.

SEG 13: Value Added Tax There was significant cost savings in this SEG as a result of a decrease in expenses incurred during the year as noted above for the individual SEGs.
There were no other material differences between the final approved budget and the actual amounts.

Basic Differences The budget and the accounting basis differ.

The financial statements for the government are prepared on the cash basis using a classification based on the nature of expenses.

The financial statements include all budget sector agencies and excludes off-budget state entities, government commercial companies and commercial statutory authorities from 1 August 2017 to 31 July 2018.
The budget is approved on cash basis by functional classification and deals only with the general government sector which excludes other extra budgetary activities.

The Statement of Cash Receipts and Payments includes the same entities as the budget and other extra budgetary activities such as TMAs and Trust.

The government's accounting system is kept on a modified cash basis.
Some expenditures are modified because some cash outflows such as accountable advances to employees for business travel are not reported when the payment is made but at the time of acquittal.

Likewise, some cash inflows such as trust money are not reported as revenues.

The Statement of Cash Receipts and Payments are prepared on the cash basis.

The general ledger amounts were adjusted to make them consistent with the cash basis to be included in the Statement of Cash Receipts and Payments.
In addition to the above, the basis for budgeting of Treasury bills is different from the basis used in accounting or reporting of Treasury bills.

The Annual Appropriation Act appropriates the interest portion of Treasury Bills whereas the Statement of Cash Receipts and Payments records net of total issuance and redemptions.
Treasury Bills is considered by government as a liquidity instrument and its sole purpose is to manage short term cash flow and support the development of the Government securities market.

Entity Differences ■ The approved budget includes all entities within the central government sector.

■ The budget deals only with the central government sector which excludes other extra budgetary activities.
The Statement of Cash Receipts and Payments includes the same entities as the budget and other extra budgetary activities such as TMAs and Trust.

There is an entity difference: the budget is prepared for the government budgetary sector and the Statement of Cash Receipts and Payment includes both budgetary and extra budgetary entities.

The entity differences are considered material.


15 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PERIOD ENDING 31 JULY 2018 Basic Differences (Cont…) Timing Difference The budget and financial statements are prepared for the same period.
A reconciliation between the actual inflows and outflows are presented in the statement of comparison of the budget and actual amounts and the amounts of total cash receipts and total cash payments reported in the statement of cash receipts and payments for the year ended 31 July 2018 is presented below: Actual amount on comparable basis as presented in the Budget and Actual Comparative Statement Entity differences Cost of goods sold (TMA) Other expenses (TMA) Net advance payments (TMA) Third party payments (Note 19) Total Cash Receipts Total Cash Payments 19.
Payment by Third Parties Total inflows 3,244,439,632 3,244,439,632 3,244,439,632 Total outflows 3,737,464,104 3,737,464,104 451,429 17,519,139 (122,419) (5,955,007) 3,749,357,246 The Government benefits from payments made by third parties to purchase goods and services on its behalf during the period.

These payments do not constitute cash receipts of payments by the government.

They include payments for goods and services made by multilateral aid agencies and non- governmental organizations.
They form part of the support for government programs provided by way of external and other assistance - additional information about external assistance and other assistance is provided by Note 19 below.
The government has verified that the following payments have been made by third parties for capital works: Capital payments Total third party payments 31 Jul 2018 ($) 5,955,007 5,955,007 31 Jul 2017 ($) 11,602,187 11,602,187 The Government benefits from goods and services purchased on its behalf as a result of cash payments made by third parties (donors) during the period by way of loans and grants.
The payments made by the third parties do not constitute cash receipts or payments by the Government but do benefit the Government.

They are disclosed in the payments by third parties column in the Statement of Cash Receipts and Payments.

These third parties (donors) are not part of the Government of Fiji (economic entity).
Such disclosures are only made when the government has been formally advised by the third party (the donor) or the recipient that such payment has been made or the government has otherwise verified the payment.

16 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PEROD ENDING 31 JULY 2018 20.
External Assistance and Other Assistance Assistance was received in the form of cash transfers and deposits to current and term deposit accounts and trust fund accounts controlled by the Government.

It also encompasses amounts drawn by the Government from accounts of donors consistent with external assistance and other assistance agreements and authorizations.

Assistance was also received in the form of third party payments.
External assistance comprises loans and grants from multilateral donor agencies under agreements specifying the purposes for which the assistance will be utilised.

Other assistance was provided for specified purposes by NGOs, private corporations and other donors.
The amounts, class of provider and purposes for which external assistance was provided during the period is outlined below: External assistance Total cash receipts Total external assistance Multilateral aid agencies Cash receipts Total multilateral aid agencies Bilateral aid agencies Cash receipts Total bilateral aid agencies Other Assistance Total cash receipts Total other assistance Non-Governmental Organizations Cash receipts Total NGOs Private Corporations and Other Donors Cash receipts Total private corporations and other donors Loan Funds External assistance Total loan funds Grants and Donations External assistance Total grants and donations 31 Jul 2018 31 Jul 2017 ($) ($) l u J 1 3 8 1 0 2 l u J 1 3 7 1 0 2 l u J $ $ $ $ 0 0 0 , 0 0 8 , 1 0 0 0 , 0 3 2 , 2 0 0 0 , 0 0 8 , 1 0 0 0 , 0 3 2 2 , 0 0 0 , 0 7 9 , 3 5 1 0 0 0 , 0 3 2 , 2 6 2 0 0 0 , 0 7 9 , 3 5 1 0 0 0 , 0 3 2 2 6 2 , : s e s o p r u p g n i w o l l o f e h t r o f ) … .
t n o c ( : ) … t n o C ( .
, 2 5 0 , 5 1 8 4 4 , 2 4 0 , 3 2 2 8 1 2 , 5 9 0 , 8 3 2 $ 4 8 3 , 8 7 1 , 4 7 2 1 8 , 5 4 8 , 8 4 6 9 1 , 4 2 0 , 3 2 1 $ 4 1 5 , 7 5 0 , 5 1 3 6 8 , 0 5 5 1 1 , 4 3 9 , 4 8 9 7 0 2 , - - - - - - - - - 4 1 5 , 7 5 0 , 5 1 3 6 8 , 0 5 5 1 1 , 4 3 9 , 4 8 9 7 0 2 , $ $ $ $ - - - - - - - - - 0 7 7 , 2 5 0 , 5 1 0 7 7 , 2 5 0 , 5 1 $ - - - $ 1 2 5 , 7 2 6 , 2 6 2 1 8 , 5 4 8 , 8 4 3 3 3 , 3 7 4 , , s n o i t a z i n a g r o l a t n e m n r e v o G - : , 8 1 7 , 3 $ 2 6 3 , 5 1 6 $ $ - - - $ - - - $ - - - $ - - - $ $ 2 3 6 , 8 1 7 , 3 2 6 3 , , e c n a t s i s s a l a n r e t x e n w a r d n U .
, $ - - - - - - 8 1 $ - - - - - - $ - - - - - - $ - - - - - - s n a o L - e c n a l a b g n i s o l C s t n a r G - e c n a l a b g n i s o l C GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PEROD ENDING 31 JULY 2018 20.
External Assistance and Other Assistance (Cont…): In regards to the drawdown of fund, these should be within the grace period, or else the borrower is required to seek extension or cancellation of the loan.

Funds drawn must be within the approved limit as per the respective loan agreements.

21.

Goods and Services Received The Government of Fiji has received goods and services in 2017-2018 from donors.
These assistance include goods such as computers and medical equipment, and services such as technical Summary of goods and services received in-kind donors Donor Agency Department of Foreign Affairs and Trade (DFAT) European Union China New Zealand Ministry of Foreign Affairs and Trade (NZMFAT) Japan Interantional Cooperation Agency (JICA) The United Childrens Fund (UNICEF) The United Development Programme (UNDP) Taiwan The Global Green Growth Institute (GGGI) Kuwait Fund Total value of goods & services received in kind Summary of goods and services received in-kind by activity Project Australian Development Scholarships (ADS)(DFAT) Australian Regional Development Scholarship (DFAT) Training in Japan (JICA) Pacific Leaders Educational Assistance for Development of State (Pacific LEADS)(JICA) Short Term Training Attachment (NZMFAT) NZ Development Scholarships - Public (NZMFAT) Pacific Islands Leadership Program (Taiwan) Human Resource Development Projects (Taiwan) 200 Vehicles Donation (China) Child Protection Program (UNICEF) Public Administration Reform and Governance (EU) Good Governance, Democracy, Health & Gender (EU) Assistance for Child Protection Program - Prosecution (UNICEF) Assistance for Child Protection Program - Prosecution (UNICEF) TC Winston Recovery Support (NZMFAT) Disaster Risk Reduction Advisor (JICA) Governance (DFAT) Access to Quality Education Program (DFAT) Australia-Pacific Technical College (DFAT) Aid-in-Kind 31 July 2018 ($) 59,925,737 32,474,290 30,778,567 8,525,583 15,985,597 2,315,360 212,253 3,327,800 438,871 1,023,919 155,007,977 Aid-in-Kind 31 July 2018 ($) 6,344,731 315,507 2,430,000 3,346,434 583,771 1,459,428 175,000 275,000 16,687,906 59,000 4,651,163 2,665,520 30,000 18,000 1,459,428 231,517 6,310,144 7,887,679 12,778,041 19 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PEROD ENDING 31 JULY 2018 Goods and Services Received (cont…) 21 Aid-in-Kind 31 July 2018 ($) Child Protection Program (UNICEF) Education Program
 (UNICEF) Technical Assistance (JICA) Project for System (JICA) Support for Fiji Higher Education Commission (FHEC) (NZMFAT) Fiji Health Sector Improvement Programme/Support Programme (DFAT) NZ Medical Treatment Scheme 2017-2021 Fiji (NZMFAT) Child Protection Programme (UNICEF) Health, Nutrition and HIV & AIDS Programme (UNICEF) Water, sanitation and hygiene programme (UNICEF) Filiarsis Elimination Program (JICA) Project for Improvement of Health Services through 5S-KAIZEN -TQM(JICA) Project for Elimination of Filarisis in the Pacific (JICA) Volunteer Scheme (JICA) Navua Hospital - Technical Cooperation (China) Mental Health Care System Enhancement Project (Personal Training) (Taiwan) Mobile Medical Teams (Taiwan) Mental Health Enhancement Project (Capacity Support for Informal Settlements - Fiji Koroipita Rotahomes Project-Phase II & Phase III (NZMFAT) Child Protection Programme (UNICEF) Policy Evidence and Social Protection (UNICEF) Volunteer Scheme (JICA) Pacific Women Shaping Pacific Development (DFAT) Engaging Youths in Organic Project (UNDP) Second Phase of Technical Assistance for China-Aid Juncao Technology Demonstration (China) Volunteer Scheme (JICA) Pacific Horticultural and Agricultural Market Access (DFAT) Fiji Dairy Industry Development Initiative (NZMFAT) NWC Capacity Building (NZMFAT) Sustainable Rural Livelihood (EU) Vegetable Production, Marketing Extension and Capacity Building Project (Taiwan) Volunteer Scheme (JICA) Scholarship Program (Taiwan) Financial Inclusion (DFAT) Fiji Community Development Program (DFAT) Market Development Facility (DFAT) Supporting Private Sector Development in Fiji (DFAT) Social Mitigation Programme -EDF 11 & Related Programs (EU) Volunteer Scheme (JICA) Project for Promotion of Regional Initiative on Solid Waste Management (J- PRISM Phase II) (JICA) Technical Assistance - Advisor for PS Infrastructure Planning and Maintenance (JICA) Technical Assistance (JICA) 8,000 110,000 652,597 66,862 2,135,037 7,887,679 364,857
GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF THE FINANCIAL STATEMENTS (cont…) FOR THE PEROD ENDING 31 JULY 2018 Goods and Services Received (cont…) 21 Reinforcing Meteorological Training Functions of Fiji Meteorological Services (FMS) (JICA) Follow up Training on Himawari Satellite, Fiji Meteorological Services (JICA) Technical Assistance (GGGI) Clean and Renewable Energy Project (Taiwan) Project for Strengthening Capacity of Dept.
Water, Sewerage to improve Rural Water Supply by Ecological Purification System Technology (JICA) Project to support reducing unaccounted water through effective control on Nadi/Ltka (JICA) Volunteer Scheme (JICA) Financing the Preparation of a Feasibility Study and Preliminary Engineering Design for Savusavu Water Supply and Sewerage System Project (Kuwait Fund for Arab Economic Development) Stinson Parade Bridge and Vatuwaqa Bridge Reconstruction Projects (China) Total value of goods & services received in-kind Aid-in-kind 31 July 2018 ($) 1,139,384 185,913 438,871 800,000 80,054 83,848 262,032 1,023,919 10,206,930 155,007,977 22.
Authorisation Date These IPSAS Financial Statements for the year ended 31 July 2018 were authorised for issue by the Permanent Secretary for Ministry of Economy on 30 November, 2020.

23.

Commitments & Contingencies Contingent liabilities of the Government at year end are disclosed in the statement of contingent liabilities in Schedule 5.
21 Financial Statements Government of the Republic of Fiji for the period ending 31 July 2018 (Other Financial Statements required by Law) GOVERNMENT OF THE REPUBLIC OF FIJI STATEMENT OF REVENUE & EXPENSES FOR THE PERIOD ENDING 31 JULY 2018 Schedule 4 Notes 31 Jul 2018 31 Jul 2017 ($) ($) REVENUE Operating Revenue Investing Revenue Trade and Manufacturing Operations TOTAL REVENUE 35 36 44(a) 3,079,416,368 165,023,264 17,970,568 3,262,410,200 2,800,944,648 36,497,041 21,655,615 2,859,097,304 EXPENSES Operating Expenses Capital Expenses Value Added Tax Interest Payments on Loans Trading and Manufacturing Operations 44(b) TOTAL EXPENSES 38 39 40 41 2,029,871,453 1,382,283,665 37,476,706 291,503,012 13,368,156 3,754,502,992 1,722,012,740 1,025,601,795 35,913,968 276,746,093 16,566,320 3,076,840,916 Deficit for the year (492,092,792) (217,743,612) 23 ) $ ( ) $ ( ) $ ( s t n e m y a p e R ) $ ( ) $ ( ) $ ( ) y l u J - g u A ( : A n o i t c e S e m a N .
o N 3 1 4 , 6 7 4 , 4 9 1 5 6 , 7 9 9 , 9 9 1 2 2 9 , 5 8 1 , 5 2 8 8 , 8 1 8 , 1 0 0 0 , 0 0 7 , 9 5 0 6 3 , 4 4 6 , 2 1 1 0 9 , 9 6 6 , 2 7 6 6 , 6 4 2 , 0 1 2 6 9 7 , 9 3 7 , 6 8 5 t a s a y t i l i b a i L 8 1 0 2 y l u J 1 3 ) $ ( 3 8 2 , 4 3 0 , 3 0 3 9 0 7 , 8 8 1 , 2 0 2 2 9 9 , 2 2 2 , 5 0 5 1 7 4 , 7 2 4 , 2 3 6 1 , 1 4 4 , 1 5 6 5 , 9 7 7 , 3 2 0 5 4 , 2 8 4 , 5 3 9 4 6 , 0 3 1 , 3 6 - - - - - - - - - - - - - - - - - - - - - 7 1 6 , 7 2 8 , 1 5 6 7 , 2 1 8 - - - 3 6 8 , 7 1 8 1 4 , 9 9 4 - - - - - - - - - - - - ) 1 8 0 , 9 7 3 ( ) 6 8 4 , 5 0 7 ( ) 6 8 3 , 3 3 7 , 4 ( ) 0 0 0 , 0 0 7 , 8 8 ( - - - - - - - - - 0 0 0 , 0 0 3 , 7 9 5 8 5 , 5 6 0 , 5 5 0 5 , 6 0 5 , 2 9 9 7 , 9 0 2 , 9 9 6 8 8 , 4 8 5 , 0 9 1 ) 0 0 0 , 0 0 7 , 9 ( ) 2 0 6 , 6 9 9 , 1 ( ) 5 5 9 , 1 8 7 , 2 ( - - - - - - 0 8 2 , 7 4 8 , 2 0 0 0 , 0 0 4 , 9 6 2 6 9 , 0 4 6 , 4 1 6 7 5 , 4 0 6 , 2 ) 2 9 6 , 1 0 8 , 0 2 1 ( 0 4 4 , 3 5 0 , 1 5 1 2 0 3 , 7 6 1 , 8 7 1 - , 7 2 8 , 1 6 4 0 , 0 3 3 , 1 ) 2 0 2 , 8 9 7 , 9 2 2 ( 0 2 7 , 0 0 2 , 1 5 2 5 1 6 , 9 7 1 , .
o N t c A ; 1 7 / 3 / - : ) D R B I ( : & - I 4 3 l a t o T d e s i a R s n a o L - s l i c n u o C l a i c n i v o r P d e s i a R s n a o L - ) k n a b e h t t s n i a g a 6 9 9 1 f o 4 1 .
o N t c A s m i a l c l a g e L ( i j i F f o k n a B l a n o i t a N 1 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2018 24 Scope of Other Financial Statements This section on other Financial Statements contains the following as required by law (Financial Management Act 2004): ■ Statement of Assets and Liabilities ■ Statement of Revenue and Expenses ■ Statement of Contingent Liabilities It also includes as part of the notes, a Segmentation Report and other budgetary execution reports as required by law.
25 Significant Accounting Policies relating to Other Financial Statements 25.1 25.2 25.3 25.4 Accounts Receivable Accounts Receivable represents money owed by third parties to Government on the sale of products receivable balance mainly comprises of unrecouped TMA or services on credit.

Account receivables as well as state revenue owed to Government by third parties.
Prepayments Prepayments comprise of unrecouped accountable advances paid to civil servants to facilitate official trips and accommodation for both domestic and overseas trips.

Inventory Inventories are stated at lower of cost and net realizable value.

Cost is assigned to inventory on a consistent basis year to year using either the specific identifications; first in first out or weighted average cost.
The cost of inventories shall comprise all costs of purchase, costs of conversion, and other costs incurred in bringing the inventories to their present location and condition.

Investments Valuation of Investments is at market value if available.

If market value is not available, investments are recorded at cost.

Fair value is especially used by entities that are listed on the South Pacific Stock Exchange namely Unit Trust of Fiji Limited (UTOF) and Amalgamated Telecommunications Holdings (ATH).
25.5 Investment in Sinking Fund Purpose of the Sinking Fund is to build cash reserves that would be sufficient to redeem the Global Bond when it matures.

This account was established mainly for the purpose of redemption of the Offshore bond as well as debt repayments for Government.

As at the end of July 2018, Sinking fund balance was $12.3m compared to $11.6m as at July 2017.

Movements within the year were a result from dividends earned (FJD183,586) and exchange rate adjustments made.
25.6 Accounts Payable Accounts Payable are amounts payable to suppliers or other creditors for the supply of goods, services or works.

25 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2018 Significant Accounting Policies relating to Other Financial Statements (Cont…) 25.7 Deferred Income Liabilities also include amounts received in advance for future services.
Since the amount received (recorded as the asset Cash) has not yet been earned, Government defers the reporting of revenues and instead reports a liability such as Unearned Revenues.

25.8 Treasury Bills Payable Treasury Bills Payable are recorded at discounted value.

25.9 Government Bonds Starting in 2015, the bond premium and discounts are being amortized over the maturity period of the bond.

However, the effect had not been applied retrospectively as it was impractible to do so.
25.10 Trust Fund Accounts Trust Fund Accounts comprises of funds which Government holds on behalf of its designated beneficiaries.

The Trust Fund Accounts comprises of operating trust and main trust monies.

25.11 Term Loans Payable Government borrow funds from either External or Domestic sources to finance its Capital Programs.

External loans are recorded to the amount of disbursement made for each loan and converted to FJD using end of year exchange rates prescribed by the Reserve Bank of Fiji.
Domestic loans are financial instruments raised locally that includes Government Bonds (Viti Bonds and Fiji Infrastructure Bonds) and Treasury Bills.

Viti Bonds are recorded at Face Value while other domestic instruments are disclosed separately in the Financial Statements 25.12 Operating Income Operating Income is recognized in the statement of receipts and payments using both accrual and cash basis system.

Where AR (accounts receivable) Modules are available, revenue is accounted on an accrual basis.
However, those Ministries whom have yet to adopt AR module are still accounting for their revenue on a pure cash basis system.

25.13 Investing Revenue Investing Revenue is recorded in the statement of receipts and payments on cash basis system.

25.14 Loans Drawn Viti Bonds are recorded at Face Value.

External Loans are recorded to the amount of disbursement made for each loan and converted to FJD using end of year exchange rates prescribed by the RBF.
25.15 Expenditure Expenditure is recorded in the statement of revenue and expenses on a cash basis except for carry- over and accountable advance.

26 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 26 Cash and Cash Equivalents The cash flow also includes other extra budgetary cash flows such as Trade and Manufacturing Account and Trust.
31 Jul 2018 ($) 31 Jul 2017 ($) Cash flows from Consolidated Fund Account of Budgetary cash flows: Net cash flows from operating activities (excluding TMA and Trust) Net cash flows from investing activities Net cash flows from financing activities Total net cash flows from Consolidated Fund Account 725,934,039 (1,215,632,867) 486,896,160 (2,802,668) Cash Flows from TMA (included in operating activities): TMA cash inflows Less TMA cash outflows Net cash flows from TMA Account 12,204,774 (13,344,785) (1,140,011) Cash Flows from Trust Funds (included in operating activities): Net Trust cash flows Net cash flows from Trust Accounts 255,925 255,925 767,069,112 (966,282,216) 217,754,081 18,540,977 18,056,598 (16,566,320) 1,490,278 50,745,573 50,745,573 Net (decrease)/increase in cash and cash equivalents 27 Prepayments Prepayments as at year end were as follows: Prepayments Advances (3,686,754) 70,776,828 75 1,081,402 1,081,477 11,739 1,192,158 1,203,897 Advances paid to staffs are recorded as prepayments, they are cleared to relevant expenditures upon retirement.
27 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 28 Inventory Inventory comprises of raw materials; work in progress and finished goods of the Government Trading and Manufacturing Activities (TMAs).

Inventories are valued at cost using the periodic inventory method.
Inventory as at year end are as follows: Raw Materials Work-in-Progress Finished Goods for Sales 29 Term-Loans Receivable 31 Jul 2018 31 Jul 2017 ($) 895,900 378,073 1,855,813 3,129,786 ($) 938,425 182,190 2,320,687 3,441,302 Term loans receivables are funds lent to state owned enterprises and students (scholarships) as part of Government on lending program.
Term-Loans Receivable Term-Loans Receivable for Social Services Term-Loans Receivable for Economic Services Total Term-Loans Receivable 29(a) 29(b) 321,705,443 250,493,863 572,199,306 Loans provided by the Government to third parties are represented as follows: (a) Term-Loans Receivable for Social Services Public Officers and Ministers I Taukei Affairs Board PSC Scholarship Lending Tertiary Education Loan Scheme Loans to Fiji Sports Council (b) Term-Loans Receivable for Economic Services Fiji Pine Commission Fiji Sugar Corporation Limited Viti Corporation Company Ltd National Trading Corporation Rewa Rice Limited Pacific Fishing Company Limited South Pacific Fertilizer Housing Authority Public Rental Board 28 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 30 Equity Investments Section 55 of the Financial Management Act 2004 provides the authority for the investment of Government moneys through fixed deposit with any bank, in any securities in which trustees are authorized to invest under the Trustee Act, in any security issued by any statutory body in Fiji and as advances authorized by Finance Act and any other Act or by resolution of the Parliament.
Investments as at year end were as follows: Shareholding 31 Jul 2018 31 Jul 2017 Investments Investments in Social Services Investments in Economic Services Investments in Infrastructure Services Total Investments (a) Investments in Social Services Post Fiji Limited Unit Trust of Fiji (Trustee) Ltd Unit Trust of Fiji (Management) Ltd Fiji Broadcasting Corporation Ltd. Walesi Ltd Fiji Public Trustee Corporation Ltd (b) Investments in Economic Services Air Pacific Ltd Fiji Hardwood Corporation Pacific Fishing Company Ltd Assets Fiji Ltd Fiji Pine Ltd Fiji Sugar Corporation Ltd Rewa Rice Ltd Viti Corps Company Ltd Yaqara Pastoral Company Ltd Food Processors Fiji Ltd Air Terminal Services ($) ($) 30(a) 30(b) 30(c) 100% 49% 100% 100% 100% 100% 51% 100% 100% 100% 100% 68% 100% 100% 100% 100% 51% 29 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 30 Equity Investments (Cont…) Shareholding 31 Jul 2018 31 Jul 2017 International Finance Corporation International Bank for Reconstruction and Development Copra Millers Fiji Ltd Asian Infrastructure Investment Bank Asia Development Bank Subscription 98% ($) 603,068 14,079,364 6,429,183 1,050,641 10,644,615 237,115,297 ($) 577,349 9,634,905 6,429,183 --- 10,207,208 231,157,071 Investments in Asian Development Bank (ADB), International Finance Corporation (IFC) and the International Bank for Reconstruction and Development (IBRD) reflect Paid-in subscriptions in the respective financial institution's capital stock that are subscribed by the government.
These are not intended as income earning investments, but only to fulfil a requirement of these institutions to be entitled to borrowing and member privileges.
(c) Investments in Infrastructure Services Airports (Fiji) Limited Amalgamated Telecom Holdings Limited Fiji Ports Corporation Limited Energy Fiji Limited (d) Reconciliation of Equity Investments The reconciliation of changes in investments are as follows: 100% 17% 41% 100% 92,300,180 219,627,976 29,993,490 749,952,450 1,091,874,096 92,300,180 80,262,716 29,993,490 --- 202,556,386 Increase/ (decrease) in fair value of shares Post Fiji Limited Unit Trust of Fiji (Trustee) Limited Unit Trust of Fiji (Management) Limited Daily Post Fiji Broadcasting Corporation Ltd Walesi Limited Fiji Public Trustee Corporation Limited Air Pacific Ltd (Fiji Airways Ltd) Fiji Hardwood Corporation Pacific Fishing Company Ltd Air Fiji Ltd Assets Fiji Limited Fiji Pine Ltd --- 287,724 --- --- --- --- --- --- --- --- --- --- --- --- --- --- (951,620) 200,000 100 2 --- --- --- (171,804) 2 --- 30 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 30 Equity Investments (Cont…) Fiji Sugar Corporation Ltd National Trading Corp. Ltd Rewa Rice Ltd Viti Corps Company Ltd Yaqara Pastoral Company Ltd Food Processors Ltd Air Terminal Services Copra Millers Fiji Ltd Yaqara Group Ltd Airports (Fiji) Ltd Amalgamated Telecommunications Holdings Fiji Ports Corporation Ltd Energy Fiji Ltd Exchange Rate adjustments International Finance Corporation International Bank for Reconstruction and Development Asian Development Bank Asian Infrastructure Investment Bank 31 Jul 2018 31 Jul 2017 ($) ($) --- --- --- --- --- --- --- --- --- --- 139,365,260 --- 749,952,450 --- (3,358,186) --- --- --- (1) --- --- (91,567) --- --- --- --- 25,719 4,444,459 437,407 1,050,641 895,563,660 (19,201) (320,429) (248,218) --- (4,960,922) The variations noted in Equity Investments are due to the recognition of Government interests in Energy Fiji Limited (475,000,000 ordinary shares of which 25,000,000 are non voting shares); increase in share price per unit (as at 31/07/17 and 31/07/18) for ATH
 and UTOF (Trustee) shares ; exchange rate adjustments for foreign investments with additional shares (264 shares) subscribed for IBRD.
31 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 31 Defferred Income 31 Jul 2018 31 Jul 2017 ($) ($) 6,061,580 5,115,009 Deferred revenues are received cash deposits that government has collected, but not yet reported as revenue on the income statement.

As they are reported as revenue in subsequent periods, (i.e.

"amortized"), the amounts are deducted from the deferred revenue account.
32 Trust Fund Account Section 25(1) of the Financial Management Act 2004 makes provision for the establishment of a Consolidated Trust Account to record all monies received by the government in trust except for monies received and administered by the Public Trustee or the Official Receiver.
The Act further stipulates that all monies which do not belong to but received and administered by Government shall be accounted for in the Consolidated Trust Fund, which shall not constitute a part of the Consolidated Fund.

The authority to open and operate a trust fund is vested with the Chief Accountant.

The Consolidated Trust Fund Account records monies received by the Government which do not belong to it and is therefore considered a liability of Government.
Closing balances in this account comprised the following: Deposits, Deductions and Retention Money Consolidated Trust Fund Total Trust Fund Account 33 Term-Loans Payable 31 Jul 2018 31 Jul 2017 ($) 36,459,911 161,241,215 197,701,126 ($) 28,368,369 168,831,120 197,199,489 Government borrows monies either domestically or from overseas to finance its Capital Programs.
Total debt of Government outstanding as at 31/07/18 are as follows: (a) Current Liabilities Term-Loans Payable - Treasury Bills Term Loans Payable - Overseas Loans Term Loans Payable - Domestic Loans Total Current Liabilities (b) Non-Current Liabilities Term-Loans Payable - Overseas Loans Term-Loans Payable - Domestic Loans Total Non-Current Liabilities 33 (c) 33(d) 33(e) 33(d) 33(e) 185,283,183 59,057,667 235,277,000 479,617,850 94,884,303 56,630,835 160,729,000 312,244,138 1,396,235,176 3,340,875,161 4,737,110,337 1,311,330,048 3,044,033,346 4,355,363,394 Total Government Debt 5,216,728,187 4,667,607,532 32 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 33 Term-Loans Payable (Cont…) Term loans payable for overseas and domestic loans have been re-classified to represent current and non-current liabilities.
(c) Treasury bills Term-Loans Payable - Treasury Bills The Government through the Reserve Bank of Fiji floats Treasury Bills to raise funds from the domestic market on a short term basis.

Treasury Bills are sold at a discount from their face value of which the investor will receive the face value upon maturity.
31 Jul 2018 31 Jul 2017 Opening Balance Treasury Bills Issued during the year less unamortized amount Treasury Bills Redemptions during the year Non-Cash unamortised discount Outstanding 31 July (d) Overseas loans Outstanding 1 August Redemptions during the year Capitalized interest Add unamortized discount Cash Borrowings Non-cash borrowing-direct disbursement Exemption - External Debt Increase in public debt due to revaluation Other adjustments Outstanding 31 July ($) 94,884,303 269,000,000 (2,500,501) (177,900,000) 1,799,381 185,283,183 1,367,960,883 (44,811,307) 943,109 850,649 68,223,377 5,955,007 --- 56,093,533 77,592 1,455,292,843 ($) 163,844,780 241,600,000 (1,883,410) (308,677,067) --- 94,884,303 1,258,728,392 (49,336,100) 579,315 859,989 211,440,261 11,602,187 (11,943,653) (54,259,170) 289,662 1,367,960,883 The Cash Borrowings amounting to $68,223,377 was utilised for general budget support.
33 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 33 Term-Loans Payable (Cont…) Non Cash borrowings - By source: Bilateral Export Import Bank of China Multilateral Asian Development Bank World Bank Non-Cash Borrowings - overseas 31 Jul 2018 ($) 31 Jul 2017 ($) --- --- 5,404,957 550,050 5,955,007 5,337,339 6,264,848 11,602,187 Overseas loans amounting to $5.95 million were drawn in financial year 01 August 2017 - 31 July 2018 from Government's loan facilities with Asian Development Bank and World Bank.
These loans drawn by Government are directly disbursed to the contractors by lenders.

Amount disbursed directly by Lenders to Water Authority of Fiji and Fiji Roads Authority was $0.91 million and $5.05 million respectively for the financial year 2017/2018.
(e) Domestic loans Outstanding 1 August Borrowings raised during the year Add: Unamortized premium Add: Accrued interests earned Reversal of previous years accrued interest Redemptions during the year Outstanding 31 July Domestic Borrowings - By Source Public Commercial Banks Insurance companies FNPF Private Others Total Domestic Borrowings raised in 2018 3,204,762,346 531,796,000 (24,714) 648,865 (301,336) (160,729,000) 3,576,152,161 76,673,000 30,267,000 402,363,000 22,493,000 531,796,000 3,079,850,613 224,223,000 30,397 301,336 --- (99,643,000) 3,204,762,346 2,000,000 34,262,000 172,635,000 15,326,000 224,223,000 Government bonds were raised locally during the year in the form of Fiji Infrastructure Bonds, Viti Bonds and Fiji Green Bonds.
Accrued interest in 2016/17 fiscal year is reversed in this fiscal year.
34 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 34 Contingent Liabilities Explicit Contingent Liabilities Government Guarantees 31 Jul 2018 ($) 31 Jul 2017 ($) 586,739,796 562,179,615 The Financial Management Act 2004 section(62) stipulates that Government may guarantee the financial liability of an entity in respect of a loan or otherwise, but only if the giving of the guarantee is authorized by the House of Representatives.
Schedule 5 Statement of Contingent Liabilities provide in detail the various agencies (8 altogether) where government undertakes giving of guarantees by end of 31 July 2018.
Other Explicit Contingent Liabilities International Bank for Reconstruction and Development (IBRD) Asian Development Bank 303,034,283 229,887,817 202,188,709 505,222,992 193,880,399 423,768,216 In addition, the subscriptions for membership with International Agencies such as the International Bank for Reconstruction and Development (IBRD) and the Asian Development Bank are also treated as contingent liabilities as the subscriptions represent callable capital and should government fail to honour the article of agreement, the agencies would call on the callable capital.
The amounts are sourced from the certificate of balances provided by ADB and IBRD.
Implicit Contingent Liabilities National Bank of Fiji - Legal claims against the bank Provincial Councils - Loans Raised Municipal Councils - Loans Raised Fiji Revenue & Customs Services - litigation claims in relation to tax and customs matters 2,427,471 1,441,163 23,779,565 35,482,450 63,130,649 6,346,718 1,873,561 25,651,122 41,818,802 75,690,203 35 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 34 Contingent Liabilities (Cont…) 31 July 2018 ($) 31 July 2017 (Re-stated) ($) Government Contingent Assets 13,640,969 11,212,893 Contingent Asset and Liability figures for Fiji Revenue and Customs Services (FRCS) has been restated for 2016- 2017FY.
The reason for the restatement is due to errors and omissions.

Errors relates to the classification of assets and liabilities whilst omissions relates to criminal cases not included in the listings.

The National Bank of Fiji comprises of legal claims against National Bank of Fiji - Asset Management Bank (NBF- AMB).
This is sourced from the certificate of balances provided by the National Bank of Fiji - Asset Management Bank whereas loans raised by provincial councils and municipal councils represent a key component in the consolidation of general Government debt.

Loans raised by Municipal Councils are deemed implicit and represent a key component in the consolidation of general government debt.

This is sourced from certificate of balances provided by the Ministry of Local Government.
The FRCS as an agent of Government has a number of litigation claims made against it in relation to tax and customs matters.

These matters are resolved through various means not wholly within the control of the FRCS and may or may not give rise to an obligation.

This is sourced from FRCSs audited Financial Statements for the year ended 31 July 2018.

From year 2015, only the explicit contingent liabilities with a reliable basis for the estimated amount are included in Schedule 5.
The government recognizes a contingency to advance to FNPF on the basis of the provision of FNPF Act 2011 section 140 (1) that says “If the board is unable to satisfy a liability of the Board referable to a fund (the “relevant fund”) out of the relevant fund, the Minister must, on written request by the Board, advance to the Board the amount needed to enable the Board to satisfy the liability”.
35 Operating Revenue Operating Revenue consists of Direct Taxes, Indirect Taxes, Fees Fines & Charges, Grant Aid, Interest & Dividends and Other Receipts.
Direct Taxes Indirect Taxes Fees, Charges, Fines and Penalties Operating Revenue - Surpluses Other Revenues and Surpluses Reimbursements and Recoveries Grants in Aid (overseas) Total Operating Revenue 31 Jul 2018 ($) 825,724,215 2,005,911,627 142,973,799 1,630 34,401,166 20,942,757 49,461,174 3,079,416,368 31 Jul 2017 ($) 766,055,195 1,813,120,249 127,840,431 220 44,298,661 30,858,490 18,771,402 2,800,944,648 36 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 36 Investing Revenue Interest received on Term-Loans Receivable Sales of Government Assets Dividend from Investments Interest from Bank Balances Return of TMA excess cash to consolidated fund account Recovery of Fijian Affairs Loans Total Investing Revenue 37 Revenue from Non Exchange Transactions 31 Jul 2018 ($) 31 Jul 2017 ($) 6,011,984 1,397,889 149,766,928 1,862,994 5,961,851 21,618 165,023,264 1,398,587 2,470,837 25,308,640 1,156,531 6,162,446 --- 36,497,041 The primary objective of this disclosure is to differentiate between revenue from non-exchange transactions and revenue from exchange transactions in accordance with IPSAS 23 Revenue from Non Exchange Transactions.
In a non-exchange transaction, government receives value from another entity without directly giving approximately equal value in exchange.

Revenue from exchange transactions on the other hand arise whereby government collected revenues and directly gives approximately equal value to another entity in exchange.
Revenue from non exchange transactions Direct Taxes (Gross) Direct Taxes Refunds Indirect Taxes Value Added Tax (Gross) Value Added Tax Refunds Fiscal Duty Excise Duty Export Duty Import Excise Duty Service Turnover Tax Water Resource Tax Departure Tax Fish Levy Stamp Duty Luxury Vehicle Duty Environmental Levy Miscellaneous indirect taxes Third Party Insurance Levy Telecommunication Levy Other non-exchange revenues Grants in Aid 31 Jul 2018 ($) 890,782,497 (65,058,282) 31 Jul 2017 ($) 825,886,787 (59,831,592) 1,044,540,672 (256,054,059) 430,241,959 166,441,553 9,720,193 59,962,329 97,871,902 64,289,698 147,494,943 85,687 85,266,235 2,063,000 150,497,950 1,528,220 953,444 1,007,902 942,908,016 (240,500,205) 399,992,227 144,708,176 9,798,921 51,043,682 133,742,799 62,565,152 145,091,598 123,042 81,024,453 1,752,157 79,105,522 1,764,709 --- --- 49,461,174 2,881,097,017 18,771,402 2,597,946,846 37 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 37 Revenue from Non Exchange Transactions (Cont…) 31 Jul 2018 ($) 31 Jul 2017 ($) Revenue from exchange transactions Fees, Charges, Fines and Penalties Trading and Manufacturing Accounts - Sales Revenue Other Revenues and Surpluses Reimbursements and Recoveries Repayment of Term-Loans Receivable Sales of Government Assets Dividend from Investments Interest from Bank Balances Return of Surplus Capital from Investments Recovery of Fijian Affairs Scholarships Total Revenue 38 Operating Expenses Operating expenditure includes the following: Established Staff Government Wage Earners Travel and Communications Maintenance and Operations Purchase of Goods and Services Operating Grants and Transfers Special Expenditure Pensions, Gratuities and Compassionate Allowances 142,973,799 17,970,568 34,402,796 20,942,757 6,011,984 1,397,889 149,766,928 1,862,994 5,961,851 21,618 381,313,184 127,840,431 21,655,615 44,298,881 30,858,490 1,398,587 2,470,837 25,308,640 1,156,531
 6,162,446 --- 261,150,458 3,262,410,201 2,859,097,304 900,309,981 58,949,182 38,444,765 75,434,699 151,359,100 680,170,593 88,246,446 36,956,687 800,546,116 53,462,154 36,571,471 69,927,885 140,315,711 518,445,776 67,863,214 34,880,413 Total Operating Expenditure 2,029,871,453 1,722,012,740 39 Capital Expenses Capital Expenditure includes the following: Capital Construction Capital Purchases Capital Grants and Transfers Total Capital Expenditure 102,877,892 75,674,702 1,203,731,071 1,382,283,665 83,016,151 48,526,290 894,059,354 1,025,601,795 38 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 40 Value Added Expense 31 Jul 2018 31 Jul 2017 ($) 37,476,706 ($) 35,913,968 These are the VAT payments made by Ministries/Departments to FRCS (Fiji Revenue & Customs Service) during the year.
41 Interest Payments and Other Charges on Loans Charges on Account of Public Debt is provided for in the Budget Estimates for the payment of interest on domestic and overseas loans.
Interest Payments Overseas Loans Domestic Loans Treasury Bills Total Interest Paid 48,864,351 240,702,829 1,799,381 291,366,561 45,538,172 229,340,752 1,722,933 276,601,857 Other charges on Public Debt - Miscellaneous Payments 136,451 144,236 Total Interest Paid and Miscellaneous Payments 291,503,012 276,746,093 Interest Payment on overseas loans 1994 Asian Development Bank 2nd Fiji Road Upgrading Project 1997 Asian Development Bank Third Road Upgrading project 1998 Japan International Corporation Agency Nadi Lautoka Water Supply and Sewerage Project 2004 Asian Development Bank Suva Nausori Water Supply and Sewerage Project 2006 Export Import Bank of China E-Government Project 2009 Asian Development Bank Emergency Flood Recovery Project 2010 Export Import Bank of China Fiji Low Cost Housing Project 2010 Export Import Bank of China Fiji Public Rental Housing Project 2010 Export Import Bank of Malaysia Queens Highway Rehabilitation Project 2010 Asian Development Bank Supplementary Third Road Upgrading project --- 915,304 319,074 22,156 891,557 389,554 1,450,176 1,228,536 631,990 611,781 764,925 204,984 --- 707,650 679,905 435,949 796,473 213,438 288,576 554,212 39 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 Interest Payments and Other Charges on Loans (Cont…) 2010 Asian Development Bank Supplementary Suva/Nausori Water Supply Project 2011 Export Import Bank of China Sigatoka Valley and Sawani Serea Road Project 2011 Export Import Bank of China Buca Bay and Moto Road Project 2011 Fiji 2nd Government Global Borrowing 2012 Export Import Bank of China Nabouwalu and Dreketi Road Upgrading Project 2014 ADB Transport and Infrastructure Project 2016 IBRD Post Cyclone Winston Emergency LN8632 2015 Global Bond 2016-2017 ADB Emergency Assistance LN3403 2016 IBRD Transport Infrastructure LN8482 2016 IFAD Agricultural Loan EUR3.1m 2016-17 WB Fiji Cable Connection to Vanua Levu LN8666 3rd Global Bond Amortisation LN8482 World Bank TIIP
 End Fee LN8666 WB Fiji Connectivity Project Front End 2017 ADB UWSWMIP LN 3512 Capitalised Interest LN8840 IBRB FSCRDPL Front End Fee Interest Payment on domestic loans Viti Bond 2012 Viti Bond 2013 Viti Bond 2014 Viti Bond 2015 Viti Bond 2016 Viti Bond 2016/17 Viti Bond 2017/18 Fiji Development Loan 2001 Fiji Development Loan 2002 Fiji Development Loan 2003 Fiji Development Loan 2004 Fiji Development Loan 2005 Fiji Development Loan 2006 Fiji Development Loan 2007 Fiji Development Loan 2008 Fiji Development Loan 2009 31 Jul 2018 ($) 660,774 31 Jul 2017 ($) 509,984 1,856,179 1,932,732 2,082,453 --- 5,128,889 448,889 2,408,998 27,016,053 2,122,529 396,945 21,063 90,180 850,649 --- --- 97,275 77,591 48,864,351 97,710 315,200 265,960 336,660 231,765 460,221 169,042 --- 805,850 5,133,720 8,032,970 6,031,018 25,155,879 7,505,350 20,371,851 40,207,875 2,169,890 --- 4,887,910 332,754 1,370,939 27,312,687 105,113 246,561 6,600 12,995 859,989 258,425 31,237 --- --- 45,538,172 131,430 315,200 265,960 336,660 231,415 205,444 --- 795,050 3,776,100 5,133,720 8,032,970 6,031,018 25,519,525 8,076,525 20,374,381 40,207,875 40 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 41 Interest Payments and Other Charges on Loans (Cont…) Fiji Development Loan 2010 Fiji Development Loan 2011 Fiji Development Loan 2012 Fiji Development Loan 2013 Fiji Development Loan 2014 Fiji Development Loan 2015 Fiji Development Loan 2016 Fiji Development Loan 2017 Fiji Development Loan 2018 Fiji Green Bonds Unamortised discount 42 Repayment of Loans Principal Repayments: Overseas Loans Domestic Loans Total Principal Repayments 31 Jul 2018 ($) 31 Jul 2017 ($) 41,056,500 6,556,590 11,449,310 8,055,020 8,802,500 11,497,089 16,790,527 13,673,547 6,040,706 1,659,969 --- 240,702,829 41,119,000 7,055,135 11,775,030 8,097,120 9,137,500 11,916,474 16,790,920 4,017,850 --- --- (1,550) 229,340,752
 44,811,307 160,729,000 205,540,307 49,336,100 99,643,000 148,979,100 Principal Repayments Overseas Loans 1994 Asian Development Bank 2nd Fiji Road Upgrading Project 1997 Asian Development Bank Third Road Upgrading project 1998 Japan International Corporation Agency Nadi Lautoka Water Supply and Sewerage Project 2004 Asian Development Bank Suva Nausori Water Supply and Sewerage Project 2005 Asian Development Bank Suva Supplementary Nausori Water Supply and Sewerage Project 2006 Export Import Bank of China E-Government Project 2009 Asian Development Bank Emergency Flood Recovery 2010 Asian Development Bank Supplementary Third Road Upgrading project 2010 Export Import Bank of Malaysia Queens Highway Rehabilitation Project 2010 EXIM Bank of China/ Fiji Low Cost Housing --- 5,939,113 2,271,693 3,752,441 981,494 3,370,497 386,964 2,210,424 --- 2,744,177 3,855,142 5,497,409 2,350,617 3,465,247 905,942 3,269,292 --- 2,043,014 10,863,562 2,661,778 41 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 42 Repayment of Loans(Cont…) 2010 EXIM Bank of China/ Public Rental Housing 2010 EXIM Bank of China/ Sigatoka Valley & Sawani Serea 2010 EXIM Bank of China/ Buca Bay and Moto roads 2011 Global bond 2012 EXIM Bank of China Road Upgrading Project Total Principal Repayments Overseas Loans 31 Jul 2018 ($) 31 Jul 2017 ($) 735,381 6,659,062 7,470,961 --- 8,289,100 44,811,307 713,300 6,459,112 7,251,685 --- --- 49,336,100 Principal repayments for external loans will commence at the end of their grace periods.
These loans were signed in 2014/2015 to 2016/2017 financial year with grace period ranging from 3 to 5 years from the signing date.

Aside from the global bonds that is due in October 2020, the principal repayments for other external loans will commence in financial year 2019 and 2021 respectively.
Principal Repayment Domestic Loans Fiji Development Loan 2001 Fiji Development Loan 2002 Fiji Development Loan 2003 Fiji Development Loan 2006 Fiji Development Loan 2007 Fiji Development Loan 2008 Fiji Development Loan 2010 Fiji Development Loan 2011 Fiji Development Loan 2012 Fiji Development Loan 2013 Fiji Development Loan 2014 Fiji Development Loan 2015 Fiji Development Loan 2016 Viti Bonds 2012 (4%) Total Principal Repayments Domestic Loans 43 Ways and Means --- 26,000,000 28,000,000 --- 10,300,000 29,870,000 --- 17,200,000 1,300,000 --- --- 45,100,000 370,000 2,589,000 160,729,000 25,000,000 33,000,000 --- 7,300,000 2,500,000 --- 2,000,000 --- --- 3,700,000 15,200,000 10,100,000 --- 843,000 99,643,000 The Ways and Means is a short term advance facility provided by the RBF for Government where advances are given to Government for a day to meet cash deficits.
The Ways and Means are replenished the day after the advances were made.
Ways and Means Receipts Ways and Means Repayments 26,800,000 (26,800,000) --- 107,500,000 (107,500,000) --- 42 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 31 Jul 2018 ($) 31 Jul 2017 ($) 44 Revenue and Expense from Trading & Manufacturing Accounts Trading and Manufacturing Accounts - Sales Revenue Trading and Manufacturing Accounts - Other Revenue and Surplus (a) Total Revenue from TMA's Cost of Goods sold Other TMA Expenditures (b) Total Expenses from TMA's 45 Arrears of Revenue 13,884,882 4,085,686 17,970,568 451,429 12,916,727 13,368,156 31 Jul 2018 ($) The Arrears of Revenue position of Government as at 31/07/2018 are as follows: Ministry of Agriculture Office of the Auditor-General Ministry of Communications Ministry of Education, Heritage and Arts Ministry of Economy (Pensions Office) Ministry of Economy (Surcharge) Ministry of Fisheries & Forests Government Printing and Stationery Department Ministry of Health and Medical Services Information Technology & Computing Services Ministry of Industry, Trade and Tourism Judiciary Ministry of Employment, Productivity and Industrial Relation Department of Lands Ministry of Infrastructure and Transport Land Transport Authority Department of Fiji Meterological Services Overseas Peacekeeping Missions Fiji Police Force Public Utilities (Water Authority of Fiji) Ministry of Rural & Maritime Development Solicitor General`s Office 806,817 24,335 8,412,697 131,265 146,141 665,804 23,036 643,597 484,381 --- --- 13,337,274 52,418 23,500,411 626,205 17,616,921 1,894,106 915,883 3,015 35,827,196 2,243,139 3,543 17,796,382 3,859,233 21,655,615 530,580 16,035,740 16,566,320 31 Jul 2017 ($) Re-stated 805,187 51,532 7,599,780 12,656 149,639 711,546 --- 479,367 404,452 289 --- 13,450,691 15,620 21,820,630 1,303,781 6,652,801 1,894,106 881,360 3,781 33,006,642 983,674 575 Total Arrears of Revenue 90,228,109 Fiji Revenue and Customs Service IRD and Customs
 arrears have been excluded from Note 45 and recognised in Statement of Assets and Liabilities.
(Note 17b) 107,358,184 43 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 31 Jul 2018 ($) 31 Jul 2017 ($) 46 Equity Movements Opening Balance 1 August Deficit for the year - consolidated fund account Surplus for the year - trade and manufacturing account Revaluation of External Debt due to foreign currency conversions Investment Equity Adjustment Adjustments of underlying account balances and Equity Previous years adjustments of term loans receivables Effects of exchange rate movements Cash remitted to Consolidated Fund Account (3,633,860,643) (496,695,204) 4,602,412 (56,093,534) 895,563,662 (32,952,120) 91,905,096 587,344 (5,961,851) (3,599,484,240) (222,832,904) 5,089,295 66,202,823 (4,960,923) (75,355,685) 204,122,853 (479,416) (6,162,446) Closing balance as at 31 July (3,232,904,838) (3,633,860,643) 47 For the year ended 31 July 2018, total amount of $121,793,317 in penalties was waived by the Fiji Revenue & Customs Services and total amount of $583,822 in interest was waived by Ministry of Lands and Mineral 48 Total income tax refunds for the year 2016/2017 has been restated from $106,865,387 to $18,694,678 to reflect the correct treatment for all refunds.
The reason for the restatement is to exclude taxes received progressively during the year.

The $18,694,678 includes only individual income tax refunds as at 31st July 2017.

49 50 Tertiary Education Loans Scheme ("Scheme") is a fund intended to provide financing to Fijian students that qualify for higher education in approved institutions but are unable to support themselves financially.
The scheme provides loans to access higher education at affordable rates of interest (free or low-interest rate of loans) for equitable access to higher education in the country in support of the Fijian Government vision of "Building a Smarter Fiji".

The scheme is addition to tuition fees covers for accommodation transport costs, pocket allowances, books and study materials and other associated costs.

The Environment and Climate Adaptation Levy (ECAL) is a tax on prescribed services, items and income.
ECAL is a broader version of the Environmental Levy introduced in 2015.

According to the Environmental Levy (Budget Amendment) Act 2017, ECAL in 2017-2018, was made up of the following: 10% tax on importation of luxury vehicles; Miscellaneous - inclusive of 10% charge on super yacht charters and docking fees; 10% income tax on individual earnings of more than FJ $270,000; 10 cents levy on plastic bags; and 10% ECAL on prescribed services.
ECAL proceeds are collected by the Fiji Revenue & Customs Services (FRCS) and administered by the Ministry of Economy in accordance with the Finance Management Act 2004 and Finance Instructions 2010.

This innovative fiscal tool helps fund critical work across Fiji to protect our natural environment, reduce our carbon footprint, and adapt our economy, our communities and our infrastructure to the worsening impacts of climate change.
44 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 51 In October 2017, Fiji made history by becoming the first emerging economy to offer a sovereign green bond.

The Fiji Sovereign Green Bond (‘FSGB’) is worth FJ $100 million and supports environmentally sustainable and climate change-related projects administered by the Fijian Government.
It has helped encourage unprecedented private-sector climate finance, expedite climate action at the national and local levels and ensure fiscal stability.

It is a unique capital market mechanism as it is largely adaptation-focused, with over 90% of spending on adaptation- centric projects and just under 10% spending on mitigation-centric projects - a true reflection of our national priorities.
The FSGB focuses on climate change and environmental conservation that stems from national policies that focus on mainstreaming holistic sustainable development.

The FSGB received overwhelming support from local and international investors alike, with more than FJ $162.4 million worth of bids received for the FJ $100 million green bonds issued.

The issuances were split into two tenors, i.e., 5 years at 4% coupon rate and 13 years at 6.3% coupon rate.
The projects selected for the FSGB were done in accordance to the Fiji Green Bond Framework, assessed by technical experts from IFC and endorsed by the FSGB Steering Committee.

52 Events After Reporting Date (i) The COVID-19 pandemic has developed rapidly in 2020 and has dismantle the way world does business and in doing so, it has upended the very fundamentals of the global economy.
The world economy including major markets, is rapidly approaching recession territory, propelled by historic growth across Asia and Europe.

Measures taken by various governments to contain the virus have affected economic activity.
Government of Fiji announced a COVID-19 Response Budget on 26 March 2020 with a $1 billion dollar Stimulus Package which incorporates a collective mobilization of various measures via the FNPF, RBF, Commercial Banks and Other Finance Companies, EFL, WAF and others to monitor and mitigate the effects of COVID-19.
Some of the measures and initiatives rolled out to stimulate the economy are government salary cuts, health facilities boost, hotel investment incentive package, capital expenditure incentive, business assistance, SME assistance, employers and individual assistance, student assistance, elderly care, other support initiatives to all, Government institutional strengthening, and direct and indirect tax measures.
(ii) On 16 April 2018, the corporatisation of Fiji Electricity Authority to a limited liability company called Energy Fiji Limited (“EFL”) was announced.

As part of the corporatisation of EFL, the following capital structure was adopted as per Legal Notice 24: Shareholder Ordinary Shares Non-Voting Shares The Permanent Secretary Responsible for Finance 475,000,000 25,000,000 The initial shareholding for the permanent secretary responsible for finance for Energy Fiji Ltd was $500,000,000.
Out of the 500,000,000 shares, 95% (475,000,000 shares) was approved to be retained by Government and 5% (25,000,000 shares) to be issued to the Non-Voting Shareholders (domestic customers) of EFL.

The Fijian Government offered the 5% non-voting shares in EFL to eligible domestic electricity customers for nil consideration.
On 23 August 2019, the Government of the Republic of Fiji announced that it had entered into an agreement to divest 20% of the shares (100,000,000 ordinary shares) in Energy Fiji Limited to the Fiji National Provident Fund (“FNPF”).

The sale was concluded on 11 October for a sum of $206,109,989.13.

Following the divestment, Government of the Republic of Fiji will retain 75% of the shares in EFL, with the remaining shares held by FNPF (20%) and the eligible domestic account holders (5%).
45 GOVERNMENT OF THE REPUBLIC OF FIJI NOTES TO AND FORMING PARTS OF OTHER FINANCIAL STATEMENTS (cont...) FOR THE PERIOD ENDING 31 JULY 2018 (iii) The US$200 million Bond will mature on 2 October 2020 and will be refinanced through funding already secured under policy – based budget support (Programme) loans with multilateral partners.
The main focus of the Programme has been the improvement in fiscal management, enhanced policy, legal and institutional framework for SOEs and public-private partnerships with improvement in business and investment climate.

No audjustment has been made to the financial statements as at 31 July 2018 to this effect.
46 GOVERNMENT OF THE REPUBLIC OF FIJI SEGMENTATION REPORT BY FUND CLASSIFICATION FOR THE PERIOD ENDING 31 JULY 2018 Segment Information (IPSAS 18.12-15) The Government Account is made up of three funds as follows: Schedule 6 ■ ■ The Consolidated Fund Account, which consists of all items funded under the Consolidated Fund Accounts (CFAs).

The operating fund is where the National Government Budget comes from.

Trading and Manufacturing Accounts (TMAs).


TMAs were established under the 1981 Finance Act to enable Government ministries and departments to undertake quasi-commercial operations for the purpose of trading or production of goods and services for sale to other departments, statutory bodies, or individuals.
Funding was provided by Government at the time of establishment and any surplus from activities in excess of the ceiling set when the original funding was allocated must be returned to the Consolidated Fund.

The monies returned are recorded as revenue in the accounts of budgetary central Government.

■ The Main Trust Fund Account consists of Trust Funds which Government are managing (as Trustees) on behalf of designated signatories.
For the purpose of this report, we are only focusing on two primary reportable segments i.e.

the segmentation of Trade and Manufacturing Account from Fund 1 (Operating) and Fund 9 (Main Trust) combined.
Primary Reportable Segments 2018 Segment revenue Non exchange revenue - taxes, grants and transfers Exchange revenue - sale of goods and services Exchange revenue - investments Segment expenses Operating Expenditure Capital Expenditure VAT Interest Payments on Loans CFA ($) TMA ($) Consolidated Total Government ($) (2,881,097,017) --- (2,881,097,017) (198,319,352) (17,970,568) (216,289,920) (165,023,264) --- (165,023,264) 2,029,871,453 1,382,283,665 37,476,707 291,503,012 13,368,156 --- --- --- - 2,043,239,609 1,382,283,665 37,476,707 291,503,012 Reconciled to aggregate net income 496,695,204 (4,602,412) 492,092,792 47 GOVERNMENT OF THE REPUBLIC OF FIJI SEGMENTATION REPORT BY FUND CLASSIFICATION FOR THE PERIOD ENDING 31 JULY 2018 Primary Reportable Segments 2018 Schedule 6 Segment Assets Cash at Bank Accounts Receivable Prepayments Inventory Investments Term-Loans Receivable Segment Liabilities Accounts Payable Deferred Income Operating Trust fund Consolidated Trust Fund Term Loans Payable - Treasury Bills Term-loans Payable Overseas Loans Term-loans Payable Domestic Loans CFA ($) TMA ($) Consolidated Total Government ($) 273,022,838 152,580,066 1,081,477 --- 1,335,906,060 572,199,306 (164,937,844) (2,899,512) (36,281,812) (162,270,743) (185,283,183) (1,455,292,843) (3,576,152,161) 13,630,893 973,684 --- 3,129,786 --- --- (211) (3,162,068) (178,099) --- --- --- --- 286,653,731 153,553,750 1,081,477 3,129,786 1,335,906,060 572,199,306 (164,938,055) (6,061,580) (36,459,911) (162,270,743) (185,283,183) (1,455,292,843) (3,576,152,161) Reconciled to net liability (3,248,328,351) 14,393,985 (3,233,934,366) ` 48 GOVERNMENT OF THE REPUBLIC OF FIJI SUMMARY OF REVENUE FOR THE PERIOD ENDING 31 JULY 2018 Heads of Revenue Operating Revenue 21 Direct Taxes……………………….. 22 Indirect Taxes……………………….
23 Fees, Fines & Charges…………….. 24 Operating Revenue Sales………….. 27 Other Receipts…………………….. 28 Reimbursements & Recoveries……….
29 Grant Aid…………………………….. Estimate 2018 ($) 790,384,046 2,306,878,986 129,206,458 605 35,938,162 34,260,648 35,630,246 Actual Revenue 2018 ($) 825,724,215 2,005,911,627 142,973,799 1,630 34,401,166 20,942,757 49,461,174 Operating Revenue Total 3,332,299,151 3,079,416,368 Schedule 7 Increase Decrease ($) ($) 35,340,169 --- 13,767,341 1,025 --- --- 13,830,928 62,939,463 --- 300,967,359 --- --- 1,536,996 13,317,891 --- 315,822,246 Investing Revenue Repayments of Term Loans Receivable………………………….
31 32 Sales of Government Assets……….

33 Dividends from Investments……….. 34 Interest from Bank Balances………… Return of Surplus Capital from Investment………………………….
35 405,110 371,874,475 148,018,527 898 6,011,984 1,397,889 149,766,928 1,862,994 5,606,874 --- 1,748,401 1,862,096 --- 370,476,586 --- --- 4,724,347 5,961,851 1,237,504 --- --- 370,476,586 686,298,832 39 Term Loan Receivable……………….. --- 21,618 Investing Revenue Total 525,023,357 165,023,264 Total Revenue 3,857,322,508 3,244,439,632 21,618 10,476,493 73,415,956 49 GOVERNMENT OF THE REPUBLIC OF FIJI DETAILED REVENUE COMPARISON FOR THE PERIOD ENDING 31 JULY 2018 Heads and Subheads of Revenue Estimate for 2018 ($) Actual Revenue 2018 ($) Increase Decrease ($) ($) Schedule 8 Actual Revenue 2017 ($) --- --- 112,832,859 112,832,859 - 734,616,839 31,438,356 --- 766,055,195 218,394,612 702,407,811 64,490,631 8,560,423 2,710,945 --- --- 399,992,227 144,708,176 9,798,921 51,043,682 133,742,799 5,608,990 62,565,152 139,524,583 145,091,598 59,023 123,042 12,548,719 81,024,453 700,312 1,752,157 476,273 --- 979,806 3,857,240 --- --- --- --- 132,899,486 15,273,542 --- 148,173,028 35,340,169 --- 825,724,215 780,618,435 45,105,780 OPERATING REVENUE 21 - DIRECT TAXES 1.
Income Tax 647,718,949 01.

Income Tax..................................…………………………………………………………….

02.

Capital Gains Tax…………………………………..……….. 29,832,238 03.

Withholding & Dividend Taxes………....… 112,832,859 Total..................................……………………………….. 790,384,046 Net Increase............................................................. 22 - INDIRECT TAXES 1.

Value Added Tax 01.

Value Added Tax..................................……1,006,881,224 2.

Custom Taxes 01.
Custom Taxes 01.

Fiscal Duty..................................………….. 494,732,590 02.

Excise Duty...........................……………… 175,001,976 03.

Export Duty............................…………… 12,431,138 58,552,409 04.

Import Duty................................................ 6.

Service Turnover Tax 01.

Hotel Turnover Tax.................................… 7.

Water Resource Tax 01.

Water Resource Tax………………………… 69,898,688 9.

Departure Tax 01.

Departure Tax………..……………………… 287,019,526 10.


Fish Levy Tax 01.

Fish Levy…………………………………….. 12.

Stamp Duty 430,241,959 166,441,553 9,720,193 59,962,329 788,486,612 147,494,943 64,289,698 97,871,902 --- --- --- 144,710 85,687 --- --- --- --- --- 97,871,902 1,409,920 01.

Stamp Duty…………………………………… 97,814,954 13.

Luxury Vehicle Levy 01.

Luxury Vehicle Levy………………………….. 2,763,312 14.

Telecommunication Levy 01.


Telecommunication levy……………………… 1,484,175 15. Credit Card Levy 01. Credit Card Levy……………………………… --- 16.

Third Party Insurance Levy 01.

3rd Party Insurance Levy…………………….

19.

Health and Environment Levy 01.


Health Levy…………………………….. 3,857,240 1,933,250 85,266,235 2,063,000 1,007,902 --- 953,444 --- --- --- --- --- --- --- 50 GOVERNMENT OF THE REPUBLIC OF FIJI DETAILED REVENUE COMPARISON FOR THE PERIOD ENDING 31 JULY 2018 Heads and Subheads of Revenue Estimate for 2018 ($) Actual Revenue 2018 ($) Schedule 8 Actual Revenue 2017 ($) 79,105,522 Increase Decrease ($) ($) --- 02.

Environmental Levy…………………….

99.

Miscellaneous Fees and Receipts 01.


Miscellaneous Fees and Receipts............. Total..................................…………………………………………… Net Decrease..................................……… 23,952 2,306,878,986 94,339,842 150,497,950 56,158,108 1,528,220 2,005,911,627 1,504,268 156,944,198 --- 457,911,557 300,967,359 1,764,709 1,813,120,249 23 - FEES, FINES & CHARGES 01.

Dues 01.

Light Due - Port & Harbor..................................…………………………………………………………….

02.

Duty 01.
02.

Duty 01.

Stamp Duty..................................…………………………………………………………….

03.

Fees 3,648,183 57,699 1,375 --- --- --- 3,590,484 1,375 --- 1,494 01.

Agricultural Produce and Inspection......................……………………………………… 1,704,262 02.

Native Timber Measurement.......…………………………….

532,306 03.

Land and Survey Fees...……………………………………………………………………………….. 646,232 04.
Mining Fees.......…………………………………………………………………………………………………………….. --- --- 540,512 --- 286,381 1,072,818 494,434 11,091 1,417,881 --- 151,798 308,802 332,913 604,491 499,064 12,569 1,478 13,916,616 12,640,060 06.

Passports....…………………………………………………………………………………………………………………………….

07.

Town Planning Fees............…………………………………………………………………… 08.

Examination Fees..........…………………………………………………………………………………… 09.

Government Day Schools-Fees.....…………………………………………….. 10.

Government Boarding Schools-Fees.………………………………….

11.
11.

Health Fumigation and Quarantine........……………………………………………………… 12.

Hospital........………………………………………………………………………………………………………………………….. 13.

Fiji School of Nursing..........…………………………………………………………………….

13,490,542 256,537 59,695 30,409 387,927 1,537,992 2,153,874 --- 472,514 48,666 26,630 431,378 1,490,901 1,838,901 282,961 34,847 38,307 474,138 1,971,388 2,742,991 11,677 42,760 480,487 904,090 --- 189,553 13,819 --- --- --- --- 1,276,556 --- --- 39 39 --- --- 60,680 14.
Cemetery Fees.......………………………………………………………………………………………………… 442,297 450,776 17.

Audit Fees........………………………………………………………………………………………………………………… 1,575,272 1,614,070 18.

Court Fees..........…………………………………………………………………………………………………………… 1,510,793 1,378,823 19.

Registration......……………………………………………………………………………………………………………….. --- 20.

Management Fee......……………………………………………………………………………………………………………….. 331,877 1,195,854 3,135,651 110,420 379,418 1,624,858 --- --- --- --- --- --- --- --- 124,407 60,166 64,241 30,926,205 21.
LTA Fees and Fines......……………………………………………………………………………………………………………….. 14,974,941 23.

LTA Road User Levy…………………………………….

27.

Offshore Fisheries Management Fees…………………… 31.

MSAF Fees………………………………………….. - 75.

Civil Aviation……………………………………………….

76.

Land Sales Revenue Fees……………………………………………….

99.
99.

Miscellaneous Fees....……………………………………………………………………………………….. --- 4,570,560 5,500 20,604 4,154,399 1,838,671 4,284,726 2,360 33,488,670 16,536,982 27,829,234 11,949,971 2,562,465 1,562,041 127,005 4,284,726 1,653,606 --- 4,570,560 1,711,666 --- --- --- --- --- --- --- --- 1,164 3,524 --- --- 51 GOVERNMENT OF THE REPUBLIC OF FIJI DETAILED REVENUE COMPARISON FOR THE PERIOD ENDING 31 JULY 2018 Heads and Subheads of Revenue Estimate for 2018 ($) Actual Revenue 2018 ($) Increase Decrease ($) ($) 04.
Licenses 01.

Arms..................................…………………………………………………………….

--- --- 02.

Banks……………………………………………………… --- 03.

Coasting..................................…………………………………………………………….

35,735 55,906 7,077 --- --- --- 05.

Liquor..................................…………………………………………………………….

161,106 06.

Trading..................................…………………………………………………………….

510,173 349,067 1,098,647 --- 07.

Dogs..................................…………………………………………………………….
20,171 --- 7,077 252,943 --- 3,559 - 845,704 17,903 46,982 21,462 96,730 Schedule 8 Actual Revenue 2017 ($) 45,688 --- 2,264 834,985 412,118 23,269 09.

Money Lenders..................................…………………………………………………………….

212,972 10.

Hotels and Guest Houses..................................…………………………………………………………….

11.

License Insurance, Agents and Brokers..................................…………………………………………………………….

1,167 6,000,000 12.
1,167 6,000,000 12.

Telecommunications and Television..................................…………………………………………………………….

--- 14.

Fishing..................................…………………………………………………………….

17,400 70,733 160,624 49,411 7,468,409 9,471 25,992 17.

License- Security Industry..................................…………………………………………………………….

1,427,236 99.

Other..................................……………………………… 05.
Rates - Public Works 48,244 1,468,409 --- 689,204 49,748 52,348 2,116,440 44,741 --- --- --- --- 7,929 --- 69,708 162,361 --- 7,819,787 23,922 16,631 1,747,350 01.

Water Charges…………………………………………… 39,186,795 06.

Fees Royalties 01.

Royalties Timber…………………...…… --- 03.

Royalties - Sand, Coral, Metal, etc.........……………….. 64,493 07.

Fines 3,297,570 01.

Court Fines………………..…………………………….. 08.


Administrative Fines and Penalty 45,242,787 6,055,992 --- --- 296,213 231,720 --- --- --- 44,260,283 --- 76,258 1,814,480 --- 1,483,090 3,549,216 02.

Administrative Fines and Forfeitures..................................…………………………………………………………….
23,921 Total..................................…………………………………….129,206,456 Net Increase.......................................……… 2,138 24,132,391 13,767,343 26,059 142,973,799 10,365,048 --- 15,188 127,840,431 24 - OPERATING REVENUE - SALES 02.

Sales - Cash............................................... Total..................................………………….………………….. 605 605 1,630 1,630 Net Increase.......................................……………….

1,025 1,025 1,025 --- --- 27 - OTHER REVENUE AND SURPLUSES 01.
Surplus/Deficit from Agency 2,000,000 01.

RBF Revaluation Reserve Account..................................…………………………………………………………….

3,485 06.

Sales of items from Technical..................... 2,090,262 11,583 90,262 8,098 --- --- 220 220 3,016,262 15,108 52 GOVERNMENT OF THE REPUBLIC OF FIJI DETAILED REVENUE COMPARISON FOR THE PERIOD ENDING 31 JULY 2018 Heads and Subheads of Revenue Estimate for 2018 ($) Actual Revenue 2018 ($) Increase Decrease ($) ($) 02.
Rent and Hire of Government Property 11,937,321 01.

Rental for Land..................................…………………………………………………………….

88,337 02.

Rental for Official Quarters..................................…………………………………………………………….

301 03.

Rental for Buildings..................................…… 1,777 04.

Hire of Plant and Vehicles.............……………………………………………….. 05.

Hire of Vessels and Punts…………………………..8,100 9,479 06.

Revenue from Rest Houses.........…………………………………………………… 03.

Commission Revenue 01.


Commission..................................…………………………………………………………….

1,141,084 99.

Other Revenue 01.

Sale of Photographs……………………….. 14,386,719 67,217 2,828,906 3,969,990 2,449,398 16,239 14,462 --- --- --- --- 4,598 101 --- --- --- --- --- --- --- 21,120 301 8,100 4,881 101 Schedule 8 Actual Revenue 2017 ($) 13,419,599 76,346 --- --- --- 9,234 3,147,001 21 02.

Sales of Publications................……………………………………………………………… 03.
Revenue from Production of Films............................……………………………………………………………………………………………… 04.

Survey & Sales of Navigation Publications......……………………… 05.

Meat Inspection.....................…………………………………………………………………….

06.

Veterinary and Animal Quarantine.........…………………………… 417,513 15,427 27,961 240,237 34,465 18,160 306,999 19,280 12,327 177,276 --- 61,198 147 68,478 413 11,532 2,189 72,730 2,336 19,038 --- --- 9,801 --- --- 07.
Freight and Charter Receipts..................................…………………………………………………………….

210,807 612 08.

Chemical Analysis...........………………………………………………………………………………………… 3,925 15,375 09.

Valuation Fees....………………………………………………………………………………………………………….. 30,461 11,415 53,677 10.

Sale of Farm Product………………….. 2,241,852 3,313 15,086 42,262 2,031,045 --- --- --- --- 971,775 1,807 18,153 31,835 62,390 389,814 30,126 1,923 --- 85,411 --- --- 22,614,359 44,298,661 65,869 475,869 19,708 52,896 266,028 8,385 11.
Sale of Surplus Farm Produce......……………………………………………….

13.

Sale of Fish and Ice.................................……………………………… 14.

Sale of Sheep and Wool.............................…………………….. 17.

Agricultural Landlord and Tenant Tribunal…………………… 19.

Drying and Storage Facilities…………………………….. 20.

Board Members Fees ……………….…...….. 24.

Pound Keeping ……………….…...….. 25.

Sale of Animals by Auction ……………….…...….. 17,736,693 99.

Other Revenue..................................…………………………………………………………….
Total..................................……………………………………35,938,162 Net Decrease............................………………….

--- 201,908 4,239 850 10,492,853 34,401,166 --- --- 110,494 4,239 850 6,037,009 --- --- --- 91,414 --- --- 4,004 2,640 --- --- 12,973 209,841 11,323 1,364 --- --- --- --- 7,243,840 7,574,005 1,536,996 28 - REIMBURSEMENT AND RECOVERIES 11.

Reimbursement of Services 01.


Reimbursement for Meteorological Services………………………………….. 477,593 500,459 22,866 --- 540,886 53 GOVERNMENT OF THE REPUBLIC OF FIJI DETAILED REVENUE COMPARISON FOR THE PERIOD ENDING 31 JULY 2018 Heads and Subheads of Revenue Estimate for 2018 ($) Actual Revenue 2018 ($) 06.

Reimbursement-HA Low Cost Housing……….……… 1,072,583 07.

Reimbursement-PRB Housing Project……… 570,360 99.

Reimbursement of WALESI Digital Television….

12.


Refund of Payments 14,385,294 Increase Decrease ($) 3,509,103 1,313,000 2,436,520 742,640 ($) --- --- --- --- 14,385,294 --- 03.

Recoveries of Overpayments in Previous Years……………………… 22.

Contributions for Capital Projects 1,655,357 996,174 --- 659,183 832,872 287 718 343 630 02.

Rural Electrifications..................................…………………………………………………………….

23.

Contributions for Overseas Peace-Keeping 01.


United Nations Peace- keeping 7,351,575 force...……………………………….. 2,563,097 02.

Multinational Force and Observers...…………………………………… 03.

UN International Peacekeeping - ….....…………………………………… --- --- --- 04.

UN Mission -IRAQ ……………………………….

4,709,006 31.


MoE Technical College Recovery 1,098,832 Total..................................…………………………………….34,260,649 20,942,757 Net Decrease...................................……………… 3,600,000 7,200,000 4,200,000 3,610,174 10,563,775 3,751,575 --- --- --- --- --- --- --- 4,636,903 4,200,000 23,881,667 13,317,892 --- --- 29 - GRANTS IN AID 02.

NZ Government Grants.................................... 03.

United Nations Development Programme…….....…………………….

04.
04.

European Union..................................…………………………………………………………….

05.

China Government Grants..................................…………………………………………………………….

06.

Japan Government Grants..................................…………………………………………………………….

--- 08.

India Government Grants --- 2,858,051 99.

Other Grant Aid..................................…………………………………………………………….
Total..................................……………………………… 35,630,246 Net Increase.............………………………………… --- --- 2,240,406 24,676,484 49,461,174 1,078,806 27,445,446 1,710,859 2,537,084 2,240,406 21,818,433 24,058,839 13,830,928 --- --- --- --- 22,544,284 --- --- --- - 1,078,806 4,901,162 1,710,859 2,537,084 10,227,911 Schedule 8 Actual Revenue 2017 ($) 3,108,842 1,789,845 12,334,958 4,562,959 --- 2,740,399 4,947,011 30,858,490 --- --- --- --- --- --- 18,771,402 18,771,402 Total Operating Revenue........................…………….3,332,299,150 Net Decrease.................................………………… 3,079,416,368 369,910,265 622,793,047 252,882,782 2,800,944,648 54 GOVERNMENT OF THE REPUBLIC OF FIJI DETAILED REVENUE COMPARISON FOR THE PERIOD ENDING 31 JULY 2018 Heads and Subheads of Revenue INVESTING REVENUE 31 - REPAYMENTS OF TERM LOANS RECEIVABLE 11.
Interest for Social Services Term Loans Estimate for 2018 ($) Actual Revenue 2018 ($) Increase Decrease ($) ($) Schedule 8 Actual Revenue 2017 ($) 01.

Interest Public Officers & Ministers ............... 184,260 02.

Interest Economic Service Term Loan...................................................... --- --- --- --- --- 184,260 30 --- --- 12.

Interest Economic Service Term Loan ..................................................... 13.
Interest Fiji Sports Council ..................................…………………………………………………………….

220,849 --- --- 100,139 --- 100,139 220,849 --- 14.

Interest PAFCO Loan...................................... --- 360,000 360,000 --- 16.

Interest Term Loan & Advances 12.

Principal Social Services Term Loans 08.

Principal- PSC Tertiary Education…………….

--- 11.

Principal - Students Scheme………… --- 22.

Principal Term Loans Economic Service 02.


Principal - Copra Industry………… Total..................................………………………………….

Net Increase....................……………………….. --- 405,109 339 339 5,450,428 --- 5,450,428 --- 101,078 6,011,984 101,078 6,011,984 5,606,875 --- --- --- --- --- --- 155,771 432,438 --- --- 617,912 --- 405,109 192,436 1,398,587 32 - SALES OF GOVERNMENT ASSETS 31.

Sales Proceeds in Infrastructure Services…………….

91.
91.

Proceed from sales of Fixed Assets Total..................................………………………………….371,874,475 Net Decrease....................……………………… 371,874,475 --- 704,215 693,674 1,397,889 --- 693,674 693,674 - 371,170,260 --- 371,170,260 370,476,586 106,313 2,364,524 2,470,837 33 - DIVIDENDS FROM INVESTMENTS 01.

Investments in Social Services.........……….

1,730,252 02.

Investments in Economic Services..................................…………………………………………………………….

31,180,648 03.
31,180,648 03.

Investments in Infrastructure Services..................................…………………………………………………………….

115,107,627 Total..................................…………………………….….

148,018,527 Net Increase....................……………………… 27,458,074 122,308,854 149,766,928 7,201,227 7,201,227 1,748,401 1,730,252 3,722,574 5,452,826 --- --- --- --- 367,383 17,497,835 7,443,422 25,308,640 34 - INTEREST FROM BANK BALANCES 02.

Interest from Domestic Bank…………… 03.


Interest from Term Deposits Local Banks………………………………….

898 --- 787,872 1,075,122 786,974 1,075,122 Total..................................…………………………………………………………….

Net Increase.........................…………………….….


898 1,862,994 1,862,096 1,862,096 --- --- --- 712,865 443,666 1,156,531 55 GOVERNMENT OF THE REPUBLIC OF FIJI DETAILED REVENUE COMPARISON FOR THE PERIOD ENDING 31 JULY 2018 Heads and Subheads of Revenue Estimate for 2018 ($) Actual Revenue 2018 ($) Increase Decrease ($) ($) 35 - RETURN OF SURPLUS CAPITAL FROM INVESTMENTS 74.

Return of Surplus Capital from TMA Operations……………………………….

Total..................................…………………………………………………………….
Net Increase........................………………………… 39 - SCHOLARSHIP BOND RECOVERY 01.

Payment Term Loan FAB………………….

Total..................................………………………………….

Net Increase...................…………………………….

4,724,347 4,724,347 --- --- 5,961,851 5,961,851 21,618 21,618 1,237,504 1,237,504 1,237,504 21,618 21,618 21,618 --- --- --- --- Schedule 8 Actual Revenue 2017 ($) 6,162,446 6,162,446 --- --- Total Investing Revenue...................…………….
Net Decrease.................……………………………… 525,023,356 165,023,264 17,028,103 377,028,195 360,000,092 36,497,041 SUMMARY OF REVENUE Operating Revenue..................................……………….3,332,299,150 Investing Revenue …………………………………… 525,023,356 3,079,416,368 165,023,264 369,910,265 17,028,103 622,793,047 377,028,195 2,800,944,648 36,497,041 Grand Totals..................................………………….…….3,857,322,506 3,244,439,632 386,938,368 999,821,242 2,837,441,689 56 GOVERNMENT OF THE REPUBLIC OF FIJI Schedule 9 STATEMENT OF EXPENDITURE AGAINST APPROPRIATION HEADS FOR THE YEAR ENDED 31 JULY 2018 Heads of Appropriation Original Budget 2018 Redeployment Revised Estimate 2018 ($) ($) ($) Actual Expenses 2018 ($) (Over) / Under Expenditure ($) GENERAL ADMINISTRATION Office of the President Office of the Prime Minister Office of the Attorney General Ministry of Economy Ministry of iTaukei Affairs Ministry of Defence and National Security Ministry of Employment, Productivity and Industrial Relations Ministry of Foreign Affairs Office of the Auditor General Fijian Elections Office Judiciary Parliament Office of the Director of Public Prosecutions Independent Commission Ministry of Disaster Management and Meteorological Services Ministry of Justice Fiji Corrections Service Ministry of Communication Ministry of Civil Services Ministry of Rural and Maritime Development Republic of Fiji Military Forces 2,144,646 23,979,967 22,314,501 117,275,376 13,214,425 5,236,688 16,486,999 43,884,988 4,612,843 22,081,169 54,463,543 10,997,878 6,292,166 27,040,535 15,178,563 7,971,408 38,750,531 55,363,660 69,032,666 20,480,286 --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- (1,808,000) 38,750,531
27,040,535 15,178,563 7,971,408 38,750,531 55,363,660 69,032,666 18,672,286 40,396,600 4,380,933 22,081,169 38,028,598 10,893,457 5,628,012 25,428,175 10,200,539 5,898,078 31,555,619 40,597,147 50,868,904 16,589,916 3,488,388 231,910 - 16,434,945 104,421 664,154 1,612,360 4,978,024 2,073,330 7,194,912 14,766,513 18,163,762 2,082,370 96,688,507 (545,000) 96,143,507 92,049,469 4,094,038 Fiji Police Force Peacekeeping Missions Total for General Administration 148,798,968 79,207,702 901,498,015 (1,907,500) --- (4,260,500) 146,891,468 79,207,702 897,237,515 143,085,756 75,824,535 778,546,169 3,805,712 3,383,167 118,691,346 57 GOVERNMENT OF THE REPUBLIC OF FIJI Schedule 9 STATEMENT OF EXPENDITURE AGAINST APPROPRIATION HEADS FOR THE YEAR ENDED 31 JULY 2018 Heads of Appropriation Original Budget 2018 Redeployment Revised Estimate 2018 ($) ($) ($) Actual Expenses 2018 ($) (Over) / Under Expenditure ($) SOCIAL SERVICES Ministry of Education, Heritage and Ministry of Health and Medical Services Department of Housing Ministry of Women, Children and Poverty Alleviation Ministry of Youth and Sports Higher Education Institutions Total for Social Services ECONOMIC SERVICES Ministry of Agriculture Ministry of Fisheries Ministry of Forests Ministry of Lands and Mineral Resources Ministry of Industry, Trade and Tourism Ministry of Sugar Ministry of Public Enterprise Ministry of Local Government and Housing Ministry of Environment Total for Economic Services INFRASTRUCTURE SERVICES Ministry of Infrastructure and Transport Water Authority of Fiji Ministry of Waterways Fiji Roads Authority Total for Infrastructure 490,115,675 321,245,594 (8,258,950) --- 481,856,725 321,245,594 460,081,244 253,932,368 21,775,481 67,313,226 34,637,160 113,354,139 (12,682,662) --- 21,954,498 113,354,139 18,853,826 106,879,217 3,100,672 6,474,922 23,096,693 106,499,610 1,088,948,871 (400,000) (3,000,000) (24,341,612) 22,696,693 103,499,610 1,064,607,259 19,885,453 99,961,415 959,593,523 2,811,240 3,538,195 105,013,736 86,339,030 18,809,218 16,020,890
 42,329,865 13,000,000 --- --- (6,950,000) 99,339,030 18,809,218 16,020,890 35,379,865 87,501,626 15,134,297 13,300,906 32,672,474 11,837,404 3,674,921 2,719,984 2,707,391 108,382,773 (3,000,000) 105,382,773 99,174,827 6,207,946 60,021,026 17,939,825 33,927,785 20,909,373 --- (2,000,000) 80,930,399 17,939,825 31,927,785 80,678,086 14,967,959 22,320,054 252,313 2,971,866 9,607,731 7,336,136 391,106,548 --- 21,959,373 7,336,136 413,065,921 6,436,903 372,187,132 899,233 40,878,789 134,177,887 --- 134,177,887 115,633,476 18,544,411 306,942,653 (16,177,888) 290,764,765 24,200,036 (3,270,000) 20,930,036 527,548,636 (50,000,000) 477,548,636 992,869,212 (69,447,888) 923,421,324 34,961,197 255,803,568 8,631,679 12,298,357 94,833,867 382,714,769 766,450,170 156,971,154 58 GOVERNMENT OF THE REPUBLIC OF FIJI Schedule 9 STATEMENT OF EXPENDITURE AGAINST APPROPRIATION HEADS FOR THE YEAR ENDED 31 JULY 2018 Heads of Appropriation Original Budget 2018 Redeployment Revised Estimate 2018 ($) ($) ($) Actual Expenses 2018 ($) (Over) / Under Expenditure ($) UNALLOCABLE Miscellaneous Services Pensions, Gratuities and Compassionate Allowances Charges on Account of Public Debt Total for Unallocable Services 628,116,801 76,090,627 704,207,428 535,898,143 46,221,100 308,070,269 982,408,170 --- --- 46,221,100 36,956,687 76,090,627 308,070,269 1,058,498,797 291,503,012 864,357,842 168,309,285 9,264,413 16,567,257 194,140,955 Grand Total 4,356,830,816 --- 4,356,830,816 3,741,134,836 615,695,980 59 , - ) $ ( 0 2 0 2 ) $ ( 9 1 0 2 ) $ ( 8 1 0 2 ) $ ( 8 1 0 2 ) $ ( 7 1 0 2 l a u t c A 6 1 0 2 ) $ ( ) s h t n o m 7 ( 0 5 1 , 5 4 2 , 0 9 2 8 9 , 2 4 1 , 1 3 6 , 3 2 1 0 , 4 2 0 , 8 8 1 1 9 , 2 4 2 , 4 5 4 , 3 4 6 2 , 3 2 0 , 5 6 1 8 6 3 , 6 1 4 ,
 9 7 0 , 3 7 5 3 , 3 2 0 , 5 2 5 2 5 1 , 9 9 2 , 2 3 3 , 3 1 4 0 , 7 9 4 , 6 3 5 5 7 , 9 5 5 7 6 , 8 4 6 , 4 4 9 , 0 0 8 , 2 5 3 4 , 8 4 2 , 3 3 4 , , 8 8 3 , 1 2 7 , 3 3 2 9 , 6 6 2 , 2 4 5 , 3 2 3 6 , 9 3 4 , 4 4 2 , 3 9 0 5 , 2 2 3 , 7 5 8 , 3 9 8 6 , 1 4 4 , 7 3 8 , 2 0 9 1 , 8 0 8 , 0 0 5 , 1 E U N E V E R L A T O T 8 7 2 , 0 9 6 , 1 3 1 , 2 1 3 8 , 7 9 7 , 3 9 2 1 6 6 , 0 3 7 , 1 9 1 , 1 3 0 1 , 0 8 2 , 3 4 5 3 9 , 9 2 1 , 6 0 3 3 2 9 , 1 1 1 , 7 5 1 , 2 5 7 9 , 1 2 6 , 5 0 3 , 1 6 2 3 , 4 8 2 , 8 4 1 1 0 , 3 0 5 , 1 9 2 3 5 4 , 1 7 8 , 9 2 0 , 2 5 6 6 , 3 8 2 , 2 8 3 , 1 6 0 7 , 6 7 4 , 7 3 9 6 2 , 0 7 0 , 8 0 3 3 5 1 , 7 8 2 , 7 0 2 , 2 4 3 6 , 2 8 9 , 8 7 7 , 1 0 6 7 , 0 9 4 , 2 6 0 9 0 , 6 4 7 , 6 7 2 0 4 7 , 2 1 0 , 2 2 7 , 1 5 9 7 , 1 0 6 , 5 2 0 , 1 8 6 9 , 3 1 9 , 5 3 1 5 9 , 4 1 2 , 4 9 9 0 3 6 , 8 8 0 , 0 5 1 9 9 9 , 8 8 6 , 0 9 5 5 3 8 , 9 8 6 1 2 , , 8 9 4 , 0 6 6 , 3 9 5 1 , 8 4 1 , 7 1 8 , 3 5 3 8 , 4 3 1 , 1 4 7 , 3 6 1 8 , 0 3 8 , 6 5 3 , 4 3 9 5 , 4 7 2 , 0 6 0 , 3 5 1 4 , 2 8 6 , 6 5 7 , 1 E R U T I D N E P X E L A T O T 9 5 2 , 9 8 8 , 0 6 ) 6 3 2 , 1 8 8 , 4 7 2 ( ) 3 0 2 , 5 9 6 , 6 9 4 ( ) 7 0 3 , 8 0 5 , 9 9 4 ( ) 4 0 9 , 2 3 8 , 2 2 2 ( ) 5 2 2 , 4 7 8 , 5 5 2 ( , 5 3 3 , 4 8 8 7 5 9 , 0 4 0 , 6 3 8 5 1 2 , 4 2 7 , 5 2 8 6 4 0 , 4 8 3 , 0 9 7 5 9 1 , 5 5 0 , 6 6 7 5 6 0 , 9 6 6 , 6 3 4 1 1 0 , 0 8 8 , 5 1 8 8 3 1 , 9 3 4 , 8 2 1 1 9 3 , 7 0 2 , 8 7 9 6 7 , 7 9 6 , 2 9 1 2 1 9 , 1 6 1 2 0 0 , 2 4 4 , 9 0 1 - - - - - - 6 9 5 , 0 6 6 , 1 1 5 0 , 3 6 1 , 2 2 4
 7 , 5 1 3 , 4 2 1 8 , 3 5 5 , 5 0 1 - - - 2 3 4 , 0 4 8 , 8 7 7 7 6 9 , 4 2 4 , 1 2 1 9 1 4 , 6 3 9 , 3 7 9 7 3 , 4 7 1 , 2 8 1 0 7 0 , 3 5 1 1 8 2 , 5 6 4 , 3 0 1 - - - - - - - 9 0 9 , 9 6 5 , 1 5 2 9 , 4 4 0 , 2 5 5 0 , 0 8 0 , 4 8 2 4 , 9 8 7 , 9 9 7 7 6 3 2 1 , 1 9 5 , 5 3 0 0 9 , 6 2 3 , 9 1 0 0 0 , 0 0 0 , 5 0 4 6 1 8 6 , 0 6 7 , 5 3 6 2 8 , 4 9 0 , 9 1 0 0 0 , 0 0 0 , 5 4 5 4 , 9 5 2 , 1 4 1 2 7 4 , 0 8 0 , 5 3 1 2 4 1 , 8 0 1 , 7 0 1 , 1 0 7 4 , 6 8 7 , 5 5 0 , 1 2 1 6 , 6 8 4 , 8 8 7 4 3 0 , 6 6 3 , 6 6 6 2 0 9 , 1 7 8 , 7 9 8 9 6 , 9 8 2 , 4 6 3 4 9 , 4 9 4 , 7 4 1 7 8 6 , 5 8 0 0 0 , 3 6 0 , 2 2 0 9 , 7 0 0 , 1 5 3 2 , 6 6 2 , 5 8 - - - - - - 4 4 4 , 3 5 9 0 5 9 , 7 9 4 , 0 5 1 0 2 2 , 8 2 5 , 1 9 9 7 , 3 7 9 , 2 4 1 0 3 6 , 1 6 6 1 , 1 0 4 , 4 3 7 5 7 , 2 4 9 , 0 2 4 7 1 , 1 6 4 , 9 4 7 7 3 , 5 0 5 , 3 4 7 6 4 8 , 3 9 7 , 4 1 1 8 8 6 , 8 9 8 , 9 6 1 8 6 , 5 2 2 , 2 7 1 0 1 7 , 4 4 1 4 5 9 , 4 1 8 , 7 9 - - - - - - - - - 5 7 1 , 4 8 4 , 1 0 5 2 , 3 3 9 , 1 0 4 2 , 7 5 8 , 3 2 4 8 , 9 3 3 , 4 9 5 0 6 2 6 1 , 8 3 9 , 5 3 8 4 6 , 0 6 2 , 4 3 6 4 2 , 0 3 6 , 5 3 8 5 4 , 6 0 2 , 9 2 1 4 2 2 , 1 8 8 , 6 0 0 , 1 1 1 8 , 7 0 4 , 2 0 7 6 0 0 , 3 4 5 , 5 0 6 9 9 7 , 2 4 7 , 3 3 1 2 5 1 , 5 6 5 , 2 6 8 9 5 , 1 9 0 , 5 4 1 2 4 0 , 3 2 1 7 5 1 , 2 5 7 , 1 3 5 4 , 4 2 0 , 1 8 - - - - - - - - - - - - 2 2 5 , 5 0 1 , 9 7 9 0 7 , 4 6 7 , 1 1 3 4 , 0 4 8 , 7 2 1 0 2 2 1 6 6 , 8 9 2 , 4 4 0 9 4 , 8 5 8 , 0 3 2 0 4 , 1 7 7 , 8 1 9 8 7 , 6 9 3 , 5 5 3 3 2 7 , 4 2 0 , 0 2 3 0 1 5 , 2 4 4 , 9 5 5 0 9 , 1 7 0 , 3 2 4 1 8 , 3 3 5 , 5 7 4 7 4 , 2 5 7 3 7 , 5 7 3 , 1 5 2 9 , 4 7 6 , 2 4 - - - - - - - - - - - - - - - - - - 6 2 0 , 8 7 2 3 2 8 , 9 6 7 , 5 6 5 7 6 , 4 6 5 , 1 2 2 1 3 , 3 2 3 , 4 1 7 5 6 , 0 7 0 , 7 1 d e t c e j o r P 0 2 0 2 d e t c e j o r P 9 1 0 2 ) $ ( ) $ ( l a u t c A 8 1 0 2 ) $ ( l a n i g i r O 8 1 0 2 ) $ ( l a u t c A 7 1 0 2 ) $ ( l a u t c A 6 1 0 2 ) $ ( ) s h t n o m 7 ( 0 2 0 2 - &
E H T R O F n o i t p i r c s e D l a t i p a C & x a T e m o c n I ( , s e n i F , s e e F s t p i e c e R & ) , 2 4 1 , 1 3 6 , 3 1 1 9 , 2 4 2 , 4 5 4 , 3 8 6 3 , 6 1 4 , 9 7 0 , 3 2 5 1 , 9 9 2 , 2 3 3 , 3 8 4 6 , 4 4 9 , 0 0 8 , 2 5 3 4 , 8 4 2 , 3 3 4 , , 4 0 2 , 0 1 1 0 3 , 7 9 2 , 7 - - - 4 0 0 , 1 4 6 2 , 3 5 4 0 0 0 , 0 0 3 , 4 7 - - - 0 2 9 , 5 8 2 , 5 - - - 9 4 9 1 1 5 , 8 2 4 0 0 0 , 0 0 3 , 5 7 - - - 1 5 2 , 7 9 9 , 4 d e t c e j o r P 0 2 0 2 d e t c e j o r P 9 1 0 2 ) $ ( ) $ ( - - - 4 8 9 , 1 1 0 , 6 9 8 8 , 7 9 3 , 1 4 9 9 , 2 6 8 , 1 8 2 9 , 6 6 7 , 9 4 1 8 1 6 , 1 2 1 5 8 , 1 6 9 , 5 l a u t c A 8 1 0 2 ) $ ( l a n i g i r O 8 1 0 2 ) $ ( l a u t c A 7 1 0 2 ) $ ( l a u t c A 6 1 0 2 ) $ ( ) s h t n o m 7 ( 0 2 0 2 - 6 1 0 2 D O I R E P E H T R O F n o i t p i r c s e D - - - 8 9 8 0 1 1 , 5 0 4 5 7 4 , 4 7 8 , 1 7 3 7 2 5 , 8 1 0 , 8 4 1 - - - 7 4 3 , 4 2 7 , 4 - - - 7 8 5 , 8 9 3 , 1 7 3 8 , 0 7 4 , 2 1 3 5 , 6 5 1 , 1 0 4 6 , 8 0 3 , 5 2 - - - 6 4 4 , 2 6 1 , 6 - - - 2 1 3 - - - 8 8 0 , 5 8 3 7 2 7 , 3 1 2 , 4 6 2 4 8 , 5 1 6 8 7 , 4 4 9 , 2 e l b a v i e
, 4 6 2 4 8 , 5 1 6 8 7 , 4 4 9 , , 5 4 2 , 0 9 2 1 0 , 4 2 0 , 8 8 4 6 2 , 3 2 0 , 5 6 1 7 5 3 , 3 2 0 , 5 2 5 1 4 0 , 7 9 4 , 6 3 5 5 7 , 9 5 5 , 7 6 e u n e v e R g n i t s e v n I l a t o T 2 3 1 , 8 8 3 , 1 2 7 , 3 3 2 9 , 6 6 2 , 2 4 5 , 3 2 3 6 , 9 3 4 , 4 4 2 , 3 9 0 5 , 2 2 3 , 7 5 8 , 3 9 8 6 , 1 4 4 , 7 3 8 , 2 0 9 1 , 8 0 8 , 0 0 5 , 1 E U N E V E R L A T O T 2 6 4 , 2 7 7 , 2 5 4 9 2 , 2 2 6 , 7 6 7 6 5 7 , 4 9 3 , 0 2 8 9 1 7 , 7 6 6 , 4 5 2 3 0 , 4 7 9 , 2 3 9 1 5 7 , 1 4 6 , 7 8 9 2 9 6 , 1 4 9 , 0 6 9 3 7 , 5 1 8 , 8 6 7 6 1 6 , 7 5 8 , 9 6 8 5 5 , 4 4 9 , 4 9 6 0 5 5 , 9 8 3 , 2 9 8 2 0 , 9 5 2 , 1 9 7 1 6 4 , 0 4 3 , 0 6 3 3 7 , 2 4 1 , 3 9 5 7 6 8 , 7 5 0 , 3 2 1 1 3 , 6 1 9 , , 7 5 7 , 9 2 8 4 7 1 , 2 0 8 , 4 6 7 8 7 5 , 8 4 6 , 3 8 8 4 9 1 , 3 8 4 , 3 5 6 8 7 1 , 4 7 9 , , 1 0 5 , 4 8 9 2 0 , 4 7 9 , 2 3 9 1 1 7 , 0 9 5 , 0 6 1 1 4 , 6 7 4 , 0 9 8 5 8 8 , 7 8 4 , 7 3 9 9 3 9 , 7 5 5 , 3 3 1 7 2 0 , 2 1 8 , 5 5 5 5 2 , 4 4 3 , 3 6 7 8 4 7 , 5 7 4 , 7 1 0 , 1 2 2 1 , 7 6 0 , 1 5 9 4 2 8 , 5 4 0 , 1 7 0 , 1 2 8 2 , 6 5 1 , 9 1 8 5 2 8 , 7 2 5 , 4 3 1 3 1 , 4 1 8 , 3 6 4 6 5 9 , 1 4 3 , A
) $ ( ) $ ( l a u t c A 8 1 0 2 ) $ ( l a n i g i r O 8 1 0 2 ) $ ( l a u t c A 7 1 0 2 ) $ ( l a u t c A 6 1 0 2 ) $ ( ) s h t n o m 7 ( 4 3 7 , 0 2 9 , 5 3 1 5 3 5 , 5 8 8 , 6 9 1 9 6 2 , 6 0 8 , 2 3 3 3 8 4 , 5 8 1 , 3 8 1 8 9 7 , 0 3 5 , 1 4 6 1 8 2 , 6 1 7 , 4 2 8 4 3 7 , 0 2 7 , 5 3 1 9 1 6 , 3 4 8 , 0 9 1 3 5 3 , 4 6 5 , 6 2 3 2 9 2 , 6 8 9 , 5 2 1 1 9 9 , 3 6 7 , 0 4 2 7 5 8 , 2 6 9 , 0 4 1 8 5 7 , 5 1 4 , 0 4 2 4 5 8 , 1 8 2 , 8 0 1 6 3 3 , 6 9 4 , 0 1 1 4 4 8 , 4 8 2 , 4 6 5 5 4 , 3 3 4 , 4 8 3 8 2 , 0 5 7 , 6 6 3 5 1 6 , 8 7 3 , 1 8 3 0 9 1 , 8 7 7 , 8 1 2 9 9 2 , 8 1 7 , 8 4 1 s e c i v r e S c i m o n o c E l a t o T 3 8 4 , 5 8 1 , 3 8 1 8 9 7 , 0 6 9 , 2 1 7 2 2 3 , 3 7 9 , 3 7 1 1 6 1 , 5 3 3 , 9 8 5 4 4 4 , 7 5 8 , 1 8 1 8 9 0 , 6 4 5 , 6 0 8 9 0 3 , 5 7 0 , 0 6 1 0 2 2 , 3 7 3 , 4 8 4 0 1 8 , 3 8 4 , 7 7 3 0 5 , 3 1 0 , , 6 4 1 , 6 9 8 3 8 4 , 8 0 3 , 3 6 7 2 4 5 , 3 0 4 , 8 8 9 9 2 5 , 8 4 4 , 4 4 6 3 1 3 , 7 9 4 , , 6 6 7 , 5 6 7 4 1 , 4 7 8 , 5 4 2 2 8 8 , 4 9 1 , 0 9 7 4 1 , 4 7 3 , 6 5 2 0 6 5 , 2 3 9 , 7 0 1 0 1 8 , 7 3 3 , 1 2 4 0 4 8 , 8 9 4 , 9 0 1 7 8 2 , 3 7 0 , 6 0 5 7 7 1 , 8 8 2 , 2 6 0 5 7 , 9 7 5 , 4 1 3 8 8 7 , 1 6 9 , 1 3 9 4 3 , 6 5 6 , , 0 4 6 , 1 1 3 9 2 0 , 9 6 5 , 6 4 3 0 7 3 , 0 7 2 , 9 2 5 7 2 1 , 2 7 5 , 5 1 6 7 2 9 , 7 6 8 , 6 7 3 7 3 1 , 8 1 6 , , 1 2 2 , 6 4 3 0 1 , 0 8 2 , 3 4 1 3 8 , 7 9 7 , 3 9 2 6 5 0 , 1 2 2 , 6 4 6 2 3 , 4 8 2 , 8 4 5 3 9 , 9 2 1 , 6 0 3 7 8 6 , 6 5 9 , 6 3 6 0 7 , 6 7 4 , 7 3 1 1 0 , 3 0 5 , 1 9
 2 0 0 1 , 1 2 2 , 6 4 0 6 7 , 0 9 4 , 2 6 9 6 2 , 0 7 0 , 8 0 3 3 1 4 , 0 8 8 , 4 3 8 6 9 , 3 1 9 , 5 3 0 9 0 , 6 4 7 , 6 7 2 7 6 0 , 4 5 7 , 0 2 5 3 8 , 9 8 6 , 1 2 0 3 6 , 8 8 0 , 0 5 1 2 7 8 , 8 9 4 , 0 6 6 , 3 9 5 1 , 8 4 1 , 7 1 8 , 3 6 3 8 , 4 3 1 , 1 4 7 , 3 5 1 8 , 0 3 8 , 6 5 3 , 4 3 9 5 , 4 7 2 , 0 6 0 , 3 5 1 4 , 2 8 6 , 6 5 7 , 1 e t a n o i s s a p m o C d n a s e i t i u t a r G , , 9 8 8 , 0 6 ) 6 3 2 , 1 8 8 , 4 7 2 ( ) 4 0 2 , 5 9 6 , 6 9 4 ( ) 6 0 3 , 8 0 5 , 9 9 4 ( ) 4 0 9 , 2 3 8 , 2 2 2 ( ) 5 2 2 , 4 7 8 , 5 5 2 ( r a e y e h t r o f l s u p r u S / ) t i c i f e D ( 4 6 0 2 0 2 - GOVERNMENT OF THE REPUBLIC OF FIJI ESTIMATE AND ACTUAL BUDGET RESULT FOR THE PERIOD 2016- 2018 Schedule 13 Actual 2016 Actual 2017 Estimate 2018 (7 months) ($) ($) ($) Actual 2018 ($) 1,433,248,435 67,559,755 2,800,944,648 36,497,041 3,332,299,152 525,023,357 3,079,416,368 165,023,264 1,500,808,190 2,837,441,689 3,857,322,509 3,244,439,632 994,214,951 150,088,630 590,688,999 21,689,835 1,722,012,740 276,746,090 1,025,601,795 35,913,968 2,207,287,153 308,070,269 1,778,982,634 62,490,760 2,029,871,453 291,503,011 1,382,283,665 37,476,706 REVENUE Operating Revenue Investing Revenue TOTAL REVENUE EXPENDITURE Operating Expenditure Interest Payments on Loans Capital Expenditure Value Added Tax TOTAL EXPENDITURE 1,756,682,415 3,060,274,593 4,356,830,816 3,741,134,835 BUDGET RESULT (255,874,225) (222,832,904) (499,508,307) (496,695,203) 65 Part B: Report on the Financial Statements of Government REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI The Office of the Auditor-General – Republic of Fiji The Office of the Auditor-General is established as
 an Independent Office by the Constitution of the Republic of Fiji.
Its roles and responsibilities include audit of the accounts of the Consolidated Fund and Financial Statements of Government and Annual Appropriation Statement required to be included in the Whole of Government annual report for a financial year under the Financial Management Act 2004.

The audit extends to audit of the accounts of all money received or held by a State entity, whether or not for purposes of Government.

These audits are carried out by the Auditor-General on behalf of Parliament.
At least once every year, the Auditor-General must report to Parliament on the audits conducted and on other significant matters the Auditor-General wishes to bring to the attention of Parliament.

This report satisfies these requirements.

As a result of its mandate, the Office of the Auditor-General has a distinctive view of the entire public sector of matters affecting financial and non-financial performance.
We use this perspective to achieve our vision of promoting public sector accountability and sustainability through our audits by providing comprehensive analysis and value-adding recommendations.

The Office of the Auditor-General notes the impact of its reports to Parliament on the ordinary citizens and strives for accuracy and high quality reporting including recommendations which are not only value-adding to the entity subject to audit but its customers , taxpayers and the general public as well.
_________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Acronyms Term ACCF ACF ADB AFS AMMU CA CE COP 23 COSO CP ECAL EDF EU FBOS FCCC FCS FDB FI FICAC FMA FMIS FNCDP FNPF FNU FPO FRCS FRA FSG FX FY GDP GWE IBRD IC IFAD IHRDP IPSAS IPSASB IRD ISA ISSAI ITC JEE LTA NAMF NDP NFAMF OAG PFTAC PR RA SARUP SEG SLG Definition Accident Compensation Commission of Fiji Accident Compensation Fund Asian Development Bank Agency Financial Statement Asset Management and Monitoring Unit Control Activities Control Environment Conference of the Parties 23 Committee of the Sponsoring Organisations of the Treadway Commission Cabinet Paper Environment & Climate Adaptation Levy European Development Fund European Union Fiji Bureau of Statistics Fijian Competition & Consumer Commission Fiji Corrections Service Fiji Development Bank Finance Instructions Fiji Independent Commission Against Corruption Financial Management Act Financial Management Information System Fiji National Council for Disabled Persons Fiji National Provident Fund Fiji National University Fiji Procurement Office Fiji Revenue and Customs Service Fiji Roads Authority Financial Statements of Government Foreign Exchange Financial Year Gross Domestic Product Government Wage Earner International Bank for Reconstruction and Development Information and Communication Control International Fund for Agricultural Development Integrated Human Resource Development Programme International Public Sector Accounting Standards International Public Sector Accounting Standards Board Inland Revenue Department International Standards on Auditing International Standards for Supreme Audit Institutions Information Technology and Computing Services Job Evaluation Exercise Land Transport Authority National Asset Management Framework National Development Plan National Fixed Asset Management Framework Office of
 the Auditor General Pacific Financial Technical Assistance Public Relations Risk Assessment Suva Ariel Roads Upgrading Project Standard Expenditure Group Standard Liability Group _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Term SPO TELS TMA TSF UNESCAP WOG Definition Strategic Planning Office Tertiary Education Loans Scheme Trading and Manufacturing Account/Activity Tuna Stabilisation Fund United Nations Economic and Social Commission for Asia and the Pacific Whole of Government _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI TABLE OF CONTENTS 1.0 SUMMARY ................................................................................................................................ 10 1.1 Introduction ............................................................................................................................. 10 1.2 1.3 1.4 1.5 1.6 Results of Our Audits .......................................................................................................... 11 Financial Performance, Position and Sustainability ......................................................... 12 Understanding Internal Controls ....................................................................................... 18 Reference to Comments ..................................................................................................... 20 Report Structure .................................................................................................................. 20 2.0 CONTEXT
20 2.0 CONTEXT .................................................................................................................................. 21 2.1 2.2 2.3 2.4 2.5 2.6 Legislative Framework ........................................................................................................ 21 Annual Financial Statements of Ministries and Departments ......................................... 21 Consolidation Process ......................................................................................................... 22 Role of the Auditor-General................................................................................................ 22 Reporting to Parliament ..................................................................................................... 24 Types of Audit Opinion ....................................................................................................... 24 3.0 RESULTS OF OUR AUDITS – MINISTRIES & DEPARTMENT ................................................... 26 3.1 3.2 3.3 3.4 Key Findings and Audit Conclusion .................................................................................... 26 Quality of Draft Agency Financial Statements .................................................................. 30 Timeliness of Financial Reporting ...................................................................................... 31 Year-End Closing Process .................................................................................................... 32 4.0 FINANCIAL STATEMENTS OF GOVERNMENT ........................................................................ 34 4.1 4.2 4.3 Introduction ......................................................................................................................... 34 Submission of Draft Financial Statements of Government ............................................. 35 Result of Our Audit .............................................................................................................. 36 5.0
36 5.0 FINANCIAL POSITION, PERFORMANCE AND SUSTAINABILITY ............................................ 38 5.1 5.2 Introduction ......................................................................................................................... 38 Assessing Position and Performance ................................................................................. 38 5.2.1 Net Operating Balance .................................................................................................... 39 5.2.2 Equity ................................................................................................................................ 40 5.2.3 Contingent Liabilities ....................................................................................................... 41 5.3 Understanding Financial Performance .............................................................................. 43 5.3.1 Revenue ............................................................................................................................ 44 5.3.2 Expenditure ...................................................................................................................... 47 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 5.3.3 Results from operation of Trading & Manufacturing Accounts .................................... 50 5.3.4 Trust Fund Accounts ........................................................................................................ 50 5.3.5 Investments ...................................................................................................................... 50 5.3.6 Term Loan Receivable...................................................................................................... 52 5.3.7 Arrears of revenue
 ........................................................................................................... 53 5.3.8 Accounts Payable ............................................................................................................. 54 5.3.9 Term Loans Payable ......................................................................................................... 54 5.3.10 Public Debt Sustainability ................................................................................................ 56 5.4 Appropriation Statement ................................................................................................... 56 6.0 ASSESSMENT OF INTERNAL CONTROLS ................................................................................ 58 6.1 6.2 Introduction ......................................................................................................................... 58 Internal Control Framework.
.............................................................................................. 58 7.0 SIGNIFICANT AUDIT MATTERS ............................................................................................... 64 7.1 Key Findings ......................................................................................................................... 64 APPENDIX A: AUDIT OPINION RESULTS ....................................................................................... 66 APPENDIX B: ANALYSIS OF FINANCIAL STATEMENTS OF GOVERNMENT ................................. 68 Cash and Cash Equivalents .............................................................................................................. 68 Borrowing Fund Account ................................................................................................................ 69 Financial Flexibility .......................................................................................................................... 82 Financial Vulnerability .................................................................................................................... 83 Investments ..................................................................................................................................... 91 APPENDIX C: ASSESSMENT OF FINANCIAL GOVERNANCE ......................................................... 96 APPENDIX D: MODIFIED AUDIT OPINION - QUALIFICATION ....................................................... 99 APPENDIX E: GLOSSARY ................................................................................................................... 107 HEAD 4 MINISTRY OF ECONOMY .............................................................................................. 109 PART A: FINANCIAL STATEMENTS ................................................................................................... 111 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 Audit Opinion
 ..................................................................................................................... 111 Statement of Receipts and Expenditure – Head 4 .......................................................... 111 Statement of Receipts and Expenditure – Head 50 ........................................................ 112 Statement of Receipts and Expenditure – Head 51 ........................................................ 113 Statement of Receipts and Expenditure – Head 52 ........................................................ 113 Statement of Receipts and Expenditure – Head 13 ......................................................... 113 Appropriation Statement – Head 4 .................................................................................. 114 Appropriation Statement – Head 50 ................................................................................ 114 Appropriation Statement – Head 51 ................................................................................. 114 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 4.10 Appropriation Statement – Head 52 ................................................................................ 116 4.11 Appropriation Statement – Head 13 ................................................................................ 116 4.12 Statement of Losses .......................................................................................................... 117 4.13 Fiji Procurement Office TMA – Profit & Loss Statement ................................................ 117 4.14 Fiji Procurement Office TMA – Balance Sheet ................................................................ 117 4.15 Office Accommodation TMA – Profit & Loss Statement ................................................ 118
118 4.16 Office Accommodation TMA – Balance Sheet ................................................................ 119 4.17 Consolidated Trust Fund Account Statement ................................................................. 119 PART B: ASSESSMENT OF FINANCIAL GOVERNANCE ..................................................................... 122 4.18 Internal Control ................................................................................................................. 122 4.19 Submission of 2017 - 2018 Draft Agency Financial Statements ...................................... 124 4.20 Quality of Draft Financial Statements ............................................................................. 124 4.21 Timeliness of Draft Financial Statements ........................................................................ 125 4.22 Timeliness of Provision of Management Comments and Signing of Financial Statements ..................................................................................................................................... 125 PART C: OTHER SIGNIFICANT MATTERS .......................................................................................... 127 4.23 Trading and Manufacturing Account - Receivables Not Recorded ................................ 127 4.24 Variance in LTA Revenue ................................................................................................... 128 4.25 Absence of Risk Management Policy, Strategic Plan and Operational Plan ................. 129 4.26 Arrears of Revenue Not Recorded ................................................................................... 130 4.27 Administration of Environmental and Climate Adaption Levy ...................................... 130 4.28 Presentation of Main Trust Fund Account - Recurring Issue ......................................... 131 4.29 Delay in Finalisation of Financial Statements - Recurring Issue .................................... 132 FINANCIAL STATEMENTS OF GOVERNMENT
 .................................................................................. 134 4.30 Internal Control Weaknesses for Ministries and Departments ..................................... 134 4.31 Variance in Payroll ............................................................................................................. 135 4.32 Annual Report on Whole of Government ........................................................................ 136 4.33 Ageing Reports not maintained for VAT & Income Tax Refunds Outstanding ............ 137 4.34 Implementation of Activities proposed in the PFTAC Report ....................................... 138 4.35 Delay in finalization of the Financial Statements of Government................................. 138 4.36 Main Trust Fund Account .................................................................................................. 140 4.37 Detailed Listing not maintained for Main Trust Fund Account ..................................... 141 4.38 Variances in Main Trust Accounts .................................................................................... 142 4.39 4.40 4.41 Reconciliations not prepared for Main Trust Fund Account – Judicial ..................... 143 Significant Outstanding Operating Trust Fund Balance ............................................. 144 Variances between FMIS General Ledger and Bank Reconciliations ........................ 146 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 4.42 4.43 4.44 4.45 Overseas bank accounts not reported at Closing Rate .............................................. 148 Debt Unit Internal Control Assessment ....................................................................... 149 Undrawn Borrowing Facilities
 ...................................................................................... 149 Accounting for Green Bond Fund ................................................................................. 151 APPENDIX 1: MINISTRY OF ECONOMY FINANCIAL STATEMENT AMENDMENTS ......................... 153 APPENDIX 2: INTERNAL CONTROL WEAKNESSES ACROSS MINISTRIES ...................................... 154 APPENDIX 3: PFTAC ACTIVITIES YET TO BE IMPLEMENTED........................................................... 156 APPENDIX 4: CAUSE OF DELAY IN FINALISATION OF FINANCIAL STATEMENTS ......................... 157 APPENDIX 5: AUDIT ADJUSTMENTS FOR FINANCIAL YEAR 2017/2018 .......................................... 161 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 1.0 SUMMARY 1.1 Introduction All Ministries and Departments prepare annual agency financial statements.
Permanent Secretaries and management of these agencies are responsible for the preparation and fair presentation of the financial statements in accordance with requirements of the Financial Management Act (FMA) 2004 and other applicable laws and regulations.
This responsibility includes designing, implementing and maintaining internal controls relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error, selecting appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

The Permanent Secretary for Economy is responsible for consolidating the financial data of all Ministries and Departments into the Financial Statements of Government (FSG).
These financial statements separately disclose expenditures against Appropriation Heads for sectors which include General Administration, Social Services, Economic Services and Infrastructure Services.

Certain expenditures that cannot be allocated to any of these sectors are reflected as unallocable.

Unallocable expenditures include miscellaneous services, pensions, gratuities and compassionate allowances and finance charges on public debt.
The accounts of other public entities1 have not been consolidated with those of government based on the decision of the Ministry of Economy.
Budget sectors General Administration Sector •Office of the President, Office of the Prime Minister and Department of Immigration, Office of the Attorney-General, Ministry of Economy, Ministry of iTaukei Affairs, Ministry of Defence and National Security, Ministry of Employment, Productivity and Industrial Relations, Ministry of Foreign Affairs, Judiciary, Parliament, Office of the Director of Public Prosecutions, Ministry of Disaster Management and Meteorological Services, Ministry of Justice, Fiji Corrections Service, Ministry of Communication, Ministry of Civil Service, Ministry of Rural and Maritime Development, Republic of Fiji Military Forces, Fiji Police Force and Peacekeeping Missions Social Services Sector •Ministry of Education, Heritage and Arts, Ministry of Health and Medical Services, Department of Housing, Ministry of Women, Children and Poverty Alleviation, Ministry of Youth and Sports and Higher Education Institutions Economic Services Sector •Ministry of Agriculture, Ministry of Fisheries, Ministry of Forestry, Ministry of Lands and Mineral Resources, Ministry of Industry, Trade and Tourism, Ministry of Sugar, Ministry of Public Enterprise and Ministry of Local Government and Housing and Ministry of Environment Infrastructure Sector • Ministry of Infrastructure and Transport, Ministry of Waterways and grants paid to Water Authority of Fiji and Fiji Roads Authority.
1 Other public entities other than Ministries and Departments _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 2017 - 2018 Budget Government expenditures were guided by the following objectives2: • Maintain national security, the rule of law and improve access to justice; • Ensure civil servants are adequately remunerated for performance, risk and technical • expertise; Increase support for education and health to strengthen Fiji’s human capital and create the foundation for a knowledge-based society; • Ensure existing social protection programs provide sufficient resources to protect the disadvantaged against inflationary pressures in the economy; • Continue with the implementation of key infrastructure projects, particularly for roads, water and electricity; • Support key policy initiatives to protect the environment and mitigate or adapt to the effects of climate change; • Provide sufficient reserves for unforeseen events such as natural disasters, including funding for emergency response and recovery; • Place greater emphasis on on-going reform initiatives to revitalise the sugar industry and ensure its long term survival; • Support key initiatives to boost the performance of primary industries such as agriculture, fisheries and forestry, given their key contribution to poverty alleviation, rural development, food security and export growth; • Accelerate key structural reforms in the public sector, including civil service reforms, public enterprise reforms and financial management reforms; • Provide sufficient support for the development of micro, small and medium enterprises; and • Promote programmes that facilitate private sector development and employment creation.
The financial position and expenditure of Government against the approved budget, have been considered against these context in this report.

1.2 Results of Our Audits We issued 38 audit opinions which included one for the Financial Statements of Government and 37 on the agency financial statements of Ministries and Departments.

The details of the results of our audits are discussed in Chapter 3 and Appendix A.
Quality and Timeliness of Financial Statements Financial Statements of Government • A modified audit opinion with emphasis of matters and other matters was issued on 08 December 2020, which was after the legislative deadline of 30 April 2019.

• The Permanent Secretary for Economy signed the audited financial statements on 30 November 2020.
• We received the first complete draft financial statements for audit on 29 November 2019 with other amended draft financial statements received for audit on 26/06/20 and 12/08/20 respectively.
2 Economic and Fiscal Update Supplement to the 2017 – 2018 Budget _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Ministries and Departments • We issued unmodified opinions on 24 or 65% of the 37 agency financial statements compared to 21 unmodified opinions issued in 2017.
This reflects a slight improvement in the number of unmodified opinions issued for 2018.

The remaining financial statements for 13 Ministries were issued with modified audit opinions.

• The submission of draft financial statements for 14 or 38% of Ministries/Departments were timely while majority (23 or 62%) were significantly late and were received for audit after the set deadline of 31 October 2018.
However, 24 or 65% of the draft financial statements were of good quality while 11 or 30% of the draft financial statements required audit and accounting adjustments after submissions for our audit • Management comments on draft management letters for 14 or 38% of Ministries/Departments were received on time and audited accounts for 20 or 54% of Ministries/Departments were signed and returned on time.
The delays in submissions of draft financial statements and management comments contributed to delays in our audit.

Delays were also attributed to the following: • Correction of errors and omissions on the draft financial statements submitted for audit; • Various accounting adjustments passed; • Delays in the submissions of management comments for issues raised in draft management letters; and • Documents required during the audit were not provided on time.
1.3 Financial Performance, Position and Sustainability Each year, the Permanent Secretary for Economy prepares the Financial Statements of Government and Annual Appropriation Statement in accordance with the provisions of the FMA 2004, Financial Instructions (FI) 2010, Finance Amendment Instructions 2016 and Cash Basis International Public Sector Accounting Standards (IPSAS) 2017.
These statements provide a consolidated view of the revenues, expenses, assets and liabilities and cash flows of State-agencies excluding controlled entities.

The statements also reflect actual expenditure against approved and revised budget by sectors and appropriation heads and revenue collected by economic type.
Financial Snapshot The key financial statement items namely expenditure, revenue, cash and cash equivalents, term loans receivables, investments, trust fund accounts, terms loans payable and equity are explained below with detail discussions in Chapter 4 and in Appendix B.

The 2018 financial year was for 12 months from 01 August 2017 to 31 July 2018.

Understanding Financial Performance (Statement of Revenue and Expenses) Table 1.1 provides a snapshot of revenue and expenses for 2018 in comparison to 2017.
_________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Table 1.1: Revenue and Expenses Snapshot Description 31/07/18 31/12/17 Direct Taxes Indirect Taxes Fees, Fines and Charges Operating Revenue Sales Other Receipts Reimbursements and Recoveries Grant Aid Total Operating Revenue Repayments of Term Loan Receivable Sale of Government Assets Dividends from Investments Interest from Bank Balances Return of Surplus Capital from Investment Term Loan Receivable Total Investing Revenue ($) 825,724,215 2,005,911,627 142,973,799 1,630 34,401,166 20,942,757 49,461,174 3,079,416,368 6,011,984 1,397,889 149,766,928 1,862,994 5,961,851 ($) 766,055,195 1,813,120,249 127,840,431 220 44,298,661 30,858,490 18,771,402 2,800,944,648 1,398,587 2,470,837 25,308,640 1,156,531 6,162,446 Increase/ (Decrease) ($) 59,669,020 192,791,378 15,133,368 1,410 (9,897,495) (9,915,733) 30,689,772 278,471,720 4,613,397 (1,072,948) 124,458,288 706,463 (200,595) 21,618 165,023,264 --- 36,497,041 21,618 128,526,223 Total 3,244,439,632 2,837,441,689 406,997,943 Operating Expenditure Capital Expenditure Total General Administration Services Operating Expenditure Capital Expenditure Total Social Services Operating Expenditure Capital Expenditure Total Economic Services Operating Expenditure Capital Expenditure Total Infrastructure Services Operating Expenditure Capital Expenditure Total Miscellaneous Services Pensions, Gratuities and Compassionate Allowance Value Added Tax Interest Payments on Loans Total Unallocable 694,944,558 69,857,616 764,802,174 593,142,733 60,340,461 653,483,194 890,476,411 60,590,711 951,067,122 763,344,255 55,812,027 819,156,282 125,986,292 240,763,991 366,750,283 108,281,854 110,496,336 218,778,190 173,973,322 589,335,161 763,308,483 160,075,309 484,373,220 644,448,529 107,932,560 421,337,810 529,270,370 62,288,177 314,579,750 376,867,927
Total Expenditure 3,741,134,836 3,060,274,593 680,860,243 Key Financial Ratio Operating Margin3 1.52 1.63 0.11 Increase from previous year Decrease from previous year 3 Operating margin benchmark is > 1.0 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI There was an overall increase in revenue by $407.0 million or 14%, which was mostly driven by increases in taxation revenue, fees, fines and charges, grant aid, repayments of term loans receivable and dividends received from investments.
Expenditure for all sectors increased resulting in an overall increase of $680.8 million or 22% in 2018.

The net operating result with and without the inclusion of capital expenditures is shown in Figure 1.1 below.
Figure 1.1: Underlying Net Operating Result with and without Capital Expenses (Five Year Trend) s n o i l l i m $ 1,000 800 600 400 200 - (200) (400) (600) 869 582 340 904 808 31/12/2014 31/12/2015 (176) (348) 31/07/2016 (7 months) (250) 31/07/2017 31/07/2018 (218) (492) Years Net Operating Result with Capital Expense Net Operating Result without Capital Expenses Source: Financial Statements of Government for 2014 - 2018 Net operating balance (with capital expenditure) remained in deficit in 2018 as in the last four years.
The net operating deficit increased by 126% from $218 million in 2017 to $492 million in 2018.

With capital expenses excluded, Government’s net operating balance recorded a surplus of $904 million for the year ended 31 July 2018 (2017: $808 million).

Payroll Details Established staff and government wage earners include full-time employees on contractual basis and project officers employed for specific projects within Ministries/Departments.
The components of payroll expenditure included personal emoluments, superannuation contributions (FNPF), various allowances and overtime.

Payroll costs and the number of employees from 2014 to 2018 are shown in Table 1.2 below.
Table 1.2: Payroll Details Established Staff Actual Payroll Expenditure $719,735,060 $781,720,316 $458,175,830 $800,546,116 $900,309,981 2014 2015 2016 (7 months) 2017 2018 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 2014 2015 2016 (7 months) 2017 2018 Number of Employees Average Cost per employee 21,785 $33,038 23,126 $33,803 23,477 $19,516 23,932 $33,451 , 26,283 $34,254 Government Wage Earners Actual Payroll Expenditure Number of Employees Average Cost per employee $45,253,662 $45,089,205 4,351 $10,363 4,633 $9,768 $28,140,510 4,520 $6,226 $53,462,154 4,642 $11,517 $58,949,182 4,263 $13,828 Overall Total Actual Payroll Expenditure Number of Employees $764,988,722 $826,809,521 27,477 26,418 $486,316,340 $854,008,270 $959,259,163 30,546 28,574 27,997 1 Source: Number of employees were extracted from Payroll Reports of Government The payroll expenditure has been steadily increasing from 2014 to 2018 with concurrent increases in the total number of employees.
The notable decline in 2016 was due to financial period of 7 months only.

The total payroll expenditure in 2018 was $959.3 million for 30,546 employees.

The highest number of employees was recorded in 2018, an increase of 1,972 from 2017.

The overall average payroll cost per employee in 2018 was $31,404 compared to $29,887 for 2017, an increase by 5%.

Figure 1.2 below shows the budgeted and actual established staff with government wage earners and employee numbers from 2014 to 2018.
Figure 1.2: Payroll Trends _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Understanding Financial Position (Statement of Assets and Liabilities) Table 1.3 provides an overview of assets and liabilities for 2018 in comparison to 2017.
Table 1.3: Assets and Liabilities Snapshot Description 31/07/18 ($) 31/07/17 ($) Cash and Cash Equivalents Accounts Receivable Prepayments Inventory Term-Loans Receivable Equity Investments Total Assets Liabilities Accounts Payable Deferred Income Trust Fund Account Term Loans Payable - Treasury Bills Term Loans Payable - Overseas Loans Term Loans Payable - Domestic Loans Total Liabilities 286,653,731 153,553,750 1,081,477 3,129,786 572,199,306 1,335,906,060 2,352,524,110 289,753,141 114,406,946 1,203,897 3,441,302 481,928,586 440,342,400 1,331,076,272 164,938,055 6,061,580 197,701,126 185,283,183 1,455,292,843 3,576,152,161 5,585,428,948 95,014,885 5,115,009 197,199,489 94,884,303 1,367,960,883 3,204,762,346 4,964,936,915 55 Increase/ (Decrease) ($) (3,099,410) 39,146,804 (122,420) (311,516) 90,270,720 895,563,660 1,021,447,838 69,923,170 946,571 501,637 90,398,880 87,331,960 371,389,815 620,492,033 Net Liability Key Financial Ratios Current ratio4 (3,232,904,838) (3,633,860,643) 400,955,805 0.52 0.67 Increase from previous year Decrease from previous year Total assets increased by $1.02 billion or 77% due to increases in accounts receivable by $39.1 million, term loan receivable by $90.3 million and equity investments by $895.6 million.
The major increase in equity investments resulted from the corporatisation of Energy Fiji Limited with total Government investment of $749.9 million.

Liabilities increased by $620.5 million or 12% due to increases in accounts payable by $69.9 million and term loans payable by $549.1 million.

The increase in term loan payable was due to the increases in government borrowing, specifically through treasury bills and government bonds.
In addition, Government offered its first Green Bond in four tranches in October 2017 worth a total of $100 million.

Proceeds from the issue of Fiji’s Green Bond were used to fund identified eligible projects that fall under various sectors in accordance with the Fiji Green Bond Framework and have been approved in the budget.

Total assets was $2.4 billion against total liabilities of $5.6 billion resulting in a net assets deficiency of $3.2 billion as at 31 July 2018.
However, the overall net assets deficiency improved in 2018 by $401 million or 11% from 2017.
4 Current ratio benchmark is > 1.0 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Understanding Sustainability Financial sustainability is defined as the ability of Government to maintain existing programs and meet existing creditor requirements without increasing the burden on the economy.
It is measured by the ratio of Government debt to the Gross Domestic Product (GDP).

The total Government debt as a percentage of GDP is an indication of debt sustainability relative to the production of goods and services.

Table 1.4 below shows the debt sustainability of Government for the last five years.
Table 1.4: Movement in Debt Sustainability to GDP FY Ended 31/7/18 31/7/17 Total Debt GDP Debt to GDP Ratio 47% Source: Financial Statements of Government 2014 - 2018 $5.2 billion $4.7 billion $11.3 billion $9.9 billion 46% 31/7/16 (7 Months) 31/12/15 31/12/14 $4.5 billion $9.8 billion 46% $4.2 billion $9.2 billion 46% $4.1 billion $8.4 billion 48% A decrease in debt to GDP ratio indicates that there is slightly less burden of debt against the total production of goods and services by the Government.
Financial Flexibility A good debt indicator is financial flexibility which shows the increase in financial resources or revenue to respond to increasing financial commitments either by expanding revenue or increasing the debt burden.

This indicator shows the percentage of total debt repayments against the total revenue for the economy.
A lower percentage of debt to be repaid from total revenue is a good indicator for Government as this shows that a larger percentage of revenue is available to be used for other Government programs.

Figure 1.3 and Table 1.5 below shows the debt financial flexibility of Government for the last five years.
Figure 1.3: Movement in Debt Financial Flexibility FY Ended 31/7/18 31/7/17 Debt Repayment Revenue Debt Repayment to Revenue Source: Financial Statements of Government 2014 - 2018 $674million $664million $3.3 billion $2.9 billion 21% 23% 31/7/16 (7 Months) 31/12/15 31/12/14 $433million $1.5 billon 29% 1,286million $2.8 billion 46% $747million $2.4 billion 31% _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI s n o i l l i m ) $ ( t n u o m A 3500 3000 2500 2000 1500 1000 500 0 Movement in Debt Financial Flexibility 3,244 2,837 46% 2,794 21% 23% 29% 1,501 1,286 673 664 7/31/2018 7/31/2017 433 31/07/16 (7 months) Years 12/31/2015 12/31/2014 2,393 31% 747 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Debt Repayment Revenue Debt Repayment to Revenue Financial Vulnerability Financial vulnerability measures the total exposure of Government to exchange rates and other market risks through its dependence on external borrowings.
The lesser the proportion of total external borrowings in comparison to domestic debt, the better it is for the Government.

Table1.6 below shows the financial vulnerability measure of Government for the last five years.
Table 1.6: Movement in Financial Vulnerability Measure FY Ended 31/7/18 31/7/17 External Debt Total Debt External Debt Total Debt Source: Financial Statements of Government 2014 - 2018 $1.4 billion $1.4 billion $5.2 billion $4.7 billion 28% 29% to 31/7/16 (7 Months) 31/12/15 31/12/14 $1.3 billion $4.5 billion 28% $1.2 billion $4.2 billion 29% $1.3 billion $4.1 billion 31% Government has a debt mix of approximately 30% external borrowings against 70% domestic borrowings.
1.4 Understanding Internal Controls Good internal controls provide reasonable assurance that Ministries or Departments are achieving their objectives relating to operations, reporting and compliance.
We assess the controls used by the Ministries/Departments using the following five key elements: (i) Control environment – actions, attitudes and values that influence daily operations; _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI (ii) Risk assessment – processes for identifying, assessing and managing risk; (iii) Control activities – policies, procedures, and actions taken to prevent or detect errors; (iv) Information and communication – systems to inform staff about control responsibilities; and (v) Monitoring activities – oversight of internal controls for existence and effectiveness.
When we identify that internal controls in any of these elements are missing or are not operating as intended, we refer to them as control deficiencies (audit finding).

If we identify that a control deficiency, either alone or in combination with other deficiencies, may lead to a material misstatement in the entity’s financial statements, we refer to this as a significant audit finding.
If we identify a deficiency (audit finding) with any of these internal controls as part of our audits, we report the finding to the entity’s management.
The internal controls for the Ministries and Departments were assessed and categorized as either effective, generally effective or ineffective as follows: Rating Internal control assessment  Effective  Generally effective  Ineffective No deficiencies identified in internal controls Deficiencies identified in internal controls Significant deficiencies identified in internal controls Summary of control assessments across the whole of government and by Sectors are shown in Table 1.7 below: Information and Communication Control (IC) Table 1.7: Summary of Control Assessments Sector Control Environment No.
of Ministries/Departments Control Activities Risk Assessment (CE) (RA) (CA) General Administration Effective Generally Effective Ineffective Social Services Effective Generally Effective Ineffective Economic Services Effective Generally Effective Ineffective Infrastructure Services Effective Generally Effective Ineffective 13 6 3 - 2 3 1 3 5 - 2 - 9 10 3 - 2 3 2 3 4 - - 2 8 9 5 1 2 2 2 1 6 - 2 - 15 4 3 1 3 1 3 3 3 - 2 - Monitoring Activities (MA) 13 6 3 1 1 3 3 3 3 - - 2 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI It is noted that the internal controls for majority of Ministries and Departments are collectively effective.
Detailed discussions on internal controls and deficiencies noted have been reported in the following respective sector reports and in Chapter 6 and Appendix C of this report: 2018 Audit Report on Economic Services Sector (Parliamentary Paper No.

147 of 2019) 1.

2.

2018 Audit Report on General Administration Sector (Parliamentary Paper No.

148 of 2019) 3.

2018 Audit Report on Social Services Sector (Parliamentary Paper No.

149 of 2019) 4.
149 of 2019) 4.

2018 Audit Report on Infrastructure Sector (Parliamentary Paper No.

150 of 2019) 5.

Remaining 2018 Audit Report on General Administration, Social Services and Economic Services Sectors (Parliamentary Paper No.

187 of 2020) This report summarizes our analysis of the financial position, performance, sustainability and timeliness and quality of financial reporting of the whole of Government.
The report also includes the results of internal control reviews in respective Ministries and Departments.

It is important to note that the deficiencies detailed in this report were identified during our audit and may have been subsequently resolved by the agency.

These have been included in this report as they impacted on the overall system of control of the Ministries and Departments as at 31 July 2018.
1.5 Reference to Comments Responses provided by the Ministry of Economy have been incorporated in this report where applicable.

Responses from Ministries and Departments have been incorporated in the sector reports.
1.6 Report Structure Chapter Description Chapter 1 Chapter 2 Chapter 3 Chapters 4 & 5 Chapter 6 Chapter 7 Appendix Provides a summary of the report and types of audit opinions Provides context for audit findings and conclusions and types of audit opinions Evaluates the audit opinion results, timeliness and quality of reporting Provides the financial analysis of the FSG Assess the strength of internal controls in ministries & departments Discusses significant audit matters in the 2018 Financial Statements of Government.
Appendices containing Assessment, Audit Opinions, Glossary and Analysis on Financial Statements of Government _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 2.0 CONTEXT 2.1 Legislative Framework The following legislation establishes the financial accountability frameworks and legislative time frames to complete financial statements audits for Ministries and Department.
Refer to Table 2.1 below.
Table 2.1: Legislative Framework Entity Type Legislative Framework Financial Government Statements of • Financial Management Act 2004 • Finance Management (Amendment) • Act 2016 Sector International Accounting (IPSAS) financial reporting under cash basis of accounting Public Standards Legislative Timeframe 30th April Ministries & Departments • Financial Management Act 2004 • Finance Instructions 2010 30th April Financial Management Act 2004 (FMA 2004) states the following principles of responsible finance management: (a) (b) (c) (d) (e) to manage finance over a medium term on a responsible and transparent basis; to manage revenues and expenditure in such a way as to achieve prudent levels of debt; to ensure value for money in the use of money and resources; to manage contingent liabilities in a prudent manner; and to report transparently in accordance with relevant accounting and statistical standards.
The legislation further states that the Minister for Economy is responsible for managing the financial affairs of the Government as a whole in accordance with the requirements of the Constitution of Republic of Fiji and the FMA 2004 and with due regard to the principles of responsible for a In addition, Ministry/Department is responsible for managing the financial affairs of the entity in accordance with the requirements of the FMA 2004 and with due regards to the principles of responsible financial management.
responsible authority the 2.2 Annual Financial Statements of Ministries and Departments Each Ministry/Department must prepare the following statements as required by Section 71 (1) of the Finance Instructions 2010 (FI 2010) as part of annual financial statements: • Statement of receipts and expenditure; • Profit and loss statement for each trading and manufacturing activity(where applicable); • Appropriation statement; • Statement of assets and liabilities for each trading and manufacturing activity (where applicable); _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI • Notes to the statement of assets and liabilities for each trading and manufacturing activity (where applicable); • Statement of losses; • Trust account statement of receipts and payments (where applicable).
On 12 June 2018, the Ministry of Economy issued Circular No.

03/2018 – Closing of Accounts, Processes & Procedures to all State-agencies to submit the 2018 draft annual financial statements to the Auditor-General by 31 October 2018.

Except for Trading and Manufacturing Accounts (TMA) which are accounted for on accrual basis, State-agencies prepare their financial statements using FMA 2004, FI 2010 and Finance (Amendment) Instructions 2016.
Each year State-agencies must prepare and make publicly available, for each financial year, an annual report which must be tabled in Parliament by the responsible Minister.

The annual report must include the audited annual financial statements and audit report issued by the Auditor- General for the financial year.
The audited financial statements are used by a broad range of users such as parliamentarians, non- governmental organizations, donor agencies, employees, suppliers, lenders and the general public.

The Auditor-General’s audit opinion on these financial statements gives reasonable assurance to the users that the financial statements are accurate and can be relied upon.
2.3 Consolidation Process The accounts of Ministries and Departments are consolidated with those of Ministry of Economy using International Public Sector Accounting Standards (IPSAS): Financial Reporting under Cash Basis of Accounting reporting requirements, Cabinet Decision 277 of 2010 - Adoption of Cash Basis IPSAS and disclosures made as required by FMA 2004.

Additional statements are prepared in accordance with modified cash basis of accounting.
Consolidated financial statements include State-agencies which are part of the national budget estimates and financials of those agencies outside the budget, such as TMAs and Trust Accounts, as required by law.

Intra-economic entity transactions, receipts and expenditures are eliminated on consolidation.
2.4 Role of the Auditor-General The Constitution of Republic of Fiji states that at least once every year, the Auditor-General shall inspect, audit and report to Parliament on - (a) (b) (c) the public accounts of the State; the control of public money and public property of the State; and all transactions with or concerning the public money or public property of the State.
In the report, the Auditor-General must state whether, in his or her opinion – (a) transactions with or concerning the public money or public property of the State have been authorized by or pursuant to the Constitution or any written law; and _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI (b) expenditures have been applied for the purpose for it was authorized.
In addition to the above, the Auditor-General is responsible on behalf of Parliament, to audit – (a) the accounts of the Consolidated Fund; (b) the Financial Statements of Government and annual appropriation statement required to be included in the Whole of Government Annual Report for a financial year under the FMA 2004; and (c) the accounts/financial statements of all state entities required to be included in the annual report for a financial year.
The Auditor-General must satisfy himself or herself that - (a) the accounts have been faithfully and properly kept; (b) expenditure has been properly authorized, properly applied and otherwise properly accounted for: (c) where applicable, all reasonable precautions have been taken to safeguard the collection of public money and trust money and other money and that the laws, directions and/or instructions relating to its collection have been duly observed; (d) where applicable, expenditure of money appropriate by Parliament has been applied to the purposes for which the money was appropriated; and (e) provisions of the Constitution of the Republic of Fiji and of the FMA 2004, and of any other law relating to money or property subject to his or her audit, have been complied with in all material respects.
The Auditor-General may conduct audits in the manner considered appropriate but must ensure that they are conducted in a competent manner having regard to assessment of effectiveness of any relevant internal control system.

The Auditor-General must carry out the audit in accordance with the relevant provisions of the standards on auditing issued by the Fiji Institute of Accountants or other relevant standards considered appropriate.
Following the completion of an audit, the Auditor-General must give an opinion on each set of financial statements audited.

In addition, a management letter should be issued to the responsible authority for each entity audited.

The Auditor-General’s responsibility is to express an opinion on these financial statements based on his or her audit in accordance with the International Standards on Auditing (ISA).
The public sector equivalent standard is International Standards for Supreme Audit Institutions (ISSAI).Those standards require the Auditor-General to comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditor’s judgment including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
In making those risk assessments, the auditor considers internal controls relevant to the entities preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
2.5 Reporting to Parliament At least once every year, the Auditor-General must report to Parliament on audits completed under the Audit Act 1969.

In addition, a report of the Auditor-General to Parliament about an audit must be submitted to the Speaker to Parliament within 9 months after the financial year in which the audit relates or within a longer period appointed by resolution of Parliament.
The Act also requires that the Auditor-General must report on other significant matters which the Auditor-General wishes to bring to the attention of Parliament.

Other significant matters highlighted in this report, include control weaknesses which could cause or is causing severe disruption to the process or on the ability of an auditee to achieve process objectives and comply with relevant legislation.
It is likely that these issues may have an impact on the operations of the entities in future, if necessary action is not taken to address them.
If any time in the opinion of the Auditor-General, serious irregularities have occurred in the receipt, custody or expenditure of public moneys or in the receipt, custody, issue sale, transfer or delivery of any stamps, securities, stores or other Government property or in the accounting for the same, he or she shall bring the matter to the notice of the- (a) (b) Minister responsible for finance; and Responsible authority and the Minister of the entity subject to audit.
2.6 Types of Audit Opinion In accordance with ISA, we express an unmodified opinion when the financial statements are prepared in accordance with the International Public Sector Accounting Standards (IPSAS) under the cash-basis of accounting and with relevant legislative requirements.

This type of opinion indicates that material misstatements, individually or in the aggregate, were not noted in our audit, which would affect the financial statements of an agency.
Modified Opinions: We issue a qualified opinion when having obtained sufficient appropriate audit evidence, we conclude that misstatements, individually or in the aggregate, are material, but not pervasive, to the financial statements; or we are unable to obtain sufficient appropriate audit evidence on which to base the opinion, but the auditor concludes that the possible effects on the financial statements of undetected misstatements, if any, could be material but not pervasive.
An adverse opinion is expressed when we, having obtained sufficient appropriate audit evidence, conclude that misstatements, individually or in the aggregate, are both material and pervasive to the financial statements.
_________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI We issue a Disclaimer of Opinion when we are unable to obtain sufficient appropriate audit evidence on which to base the opinion, and we conclude that the possible effects on the financial statements of undetected misstatements, if any, could be both material and pervasive.
We include an Emphasis of Matter paragraph in the audit report to highlight an issue that will help the user better understand the financial statements.

We also include an Other Matter paragraph to highlight a matter that is relevant to users’ understanding of the audit report.
_________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 3.0 RESULTS OF OUR AUDITS – MINISTRIES & DEPARTMENT We audit the financial statements of Ministries and Departments to provide reasonable assurance about whether the financial statements are free from material misstatements.
3.1 Key Findings and Audit Conclusion We issued 37 audit opinions on the 2018 financial statements of Ministries and Departments out of which 24 or 65% were unmodified opinions while 13 or 35% were modified opinions.

This indicated that most agency financial statements did not contain material misstatements individually or in aggregate.
Introduction In addition to the Financial Statements of Government, each year, we also audit the financial statements of Ministries and Departments to provide assurance to their reliability.

The Ministry of Economy advised all Ministries and Departments to provide the 2018 draft agency financial statements to the Auditor-General by 31 October 2018.
If an agency complies with the monthly and quarterly reporting requirements set by the FI 2010 throughout the year, it should be able to prepare and present a high quality financial statements in a timely manner.
We assessed the quality and timeliness of financial statements prepared by the 37 Ministries and Department by considering: • Year - end closing process – whether accounts were closed-off on agreed date; • Timelines – whether complete 2018 draft financial statements were submitted for audit by the agreed date; • Quality – the extent of accounting and auditing adjustments made during the audit; • Management comments – time taken (in days) by Ministries/Departments to submit management comments on audit findings raised in the Draft Management Letter (DML); and • Signing of financial statements – time taken (in days) by Ministries/Departments to submit signed financial statements.
Our assessment criteria and the result of our assessment for each Ministry/Department are included in Appendix C and the summary of the whole of government assessments of timeliness and quality shown in Table 3.1 below.

Table 3.1: Summary of Timeliness and Quality Assessment No.
of Ministries/Departments Compliance to Year End Process Quality of Financial Statements Timeliness of Financial Statement Timeliness of Management Comments Effective Generally Effective Ineffective Total 9 22 6 37 19 7 11 37 3 10 24 37 13 1 23 37 Timeliness of Signing of Financial Statements 16 4 17 37 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI It is noted that most Ministries/Departments were effective or generally effective in compliance to year-end closing processes, quality of the financial statements and timeliness of signing financial statements.
However, a good number of Ministries/Departments were ineffective in the following: • Timeliness of submission of draft financial statements – 65% • Timeliness of submission of management comments – 62% • Timeliness of signing of financial statements - 46% Audit Opinion Results Table 3.2 summarizes the types of audit opinions issued on the 2017-2018 financial statements by sectors.
Table 3.2: Audit Opinions Issued for FY 2017 - 2018 Sector Unmodified Opinion General Administration Social Services Economic Services Infrastructure Services Total 16 2 5 1 24 Modified Opinion (Qualified) 5 3 4 1 13 The summary and details of the agencies that fall under each Sector and the opinion issued on the financial statements have been reported in the five sector reports submitted to Parliament.
Modified Opinions We issued modified opinions (qualified) on 13 (35%) of the 2018 financial statements audited for various Ministries and Departments which indicated material misstatements were noted in the financial statements.
A modified opinion (qualified) is issued when having obtained sufficient appropriate audit evidence, we conclude that misstatements, individually or in the aggregate, are material, but not pervasive, to the financial statements; or we are unable to obtain sufficient appropriate audit evidence on which to base the opinion, but the auditor concludes that the possible effects on the financial statements of undetected misstatements, if any, could be material but not pervasive.
The key reasons for the modified audit opinions, as discussed in Appendix D have been reported to the management of the respective agencies and in the various sector reports to Parliament.

Refer to Table 3.3 for Ministries/Departments with modified audit opinion and the key areas.
_________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 27 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Table 3.3: Key Areas for Modified Audit Opinion – Auditors’ Reports New Key Area/emphasis of matter Recurring Key Area/emphasis of matter Ministries/Departments Revenue Main Trust Fund Account Key Areas for Modified Audit Opinion Records Management Inventory Expenditure TMA Value Added Tax General Administration 1.
Office of the Prime Minister and Department of Immigration5 2.

2 Ministry of Employment, Productivity and Industrial  Relations 3.

Judiciary 4.

Ministry of Rural and Maritime Development 5.

Fiji Police Force Social Services 6.

Ministry of Education, Heritage and Arts and Higher Education Institutions 7.

Ministry of Health and Medical Services 8.

Ministry of Women, Children and Poverty Alleviation Economic Services 9.

Ministry of Fisheries 10.

Ministry of Forestry6 11.


Ministry of Lands and Mineral Resources 12.

Ministry of Environment7 Infrastructure Services 13.

Ministry of Infrastructure and Transport Unmodified Opinions                             We issued unmodified opinions on 24 or 65% of the 2018 financial statements for various Ministries and Departments which indicated that material misstatements were not noted in majority of the agencies audited.
However, emphasis of matters and other matters were reported in the Auditors’ Reports.

In accordance with ISA, we express an unmodified opinion when the financial statements are prepared in accordance with the provisions of the FMA 2004 and with relevant legislative requirements.

This type of opinion indicates that material misstatements, individually or in the aggregate, are not noted in our audit, which will affect the financial statements of an entity.
Refer Table 3.4 for Ministries/Departments with unmodified audit opinion and with emphasis of matter/other matter.

Table 3.4: Ministries/Departments with Unmodified Audit Opinion Unmodified with emphasis of matter and/or other matter Ministry/Department 1.

Office of the President 2.
Office of the Attorney General Emphasis of Matter/Other Matters  5 The qualifications were for the Department of Immigration 6 Ministry of Fisheries and Forest were under same appropriation head in 2016 - 2017 7 Ministry of Environment was in Ministry of Local Government appropriation head in 2016 - 2017 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 28 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Ministry/Department 3.
Ministry of Economy 4.

Ministry of iTaukei Affairs 5.

Ministry of Defence and National Security 6.

Ministry of Foreign Affairs 7.

Parliament 8.

Office of the Director of Public Prosecutions 9.

Ministry of Disaster Management and Meteorological Services 10.

Ministry of Justice 11.

Fiji Corrections Service 12.

Ministry of Communication 13.

Department of Information, Technology and Computing Services (ITC) 14.

Ministry of Civil Service 15.

Republic of Fiji Military Forces 16.


Peacekeeping Missions 17.

Department of Housing 18.

Ministry of Youth and Sports 19.

Ministry of Agriculture 20.

Ministry of Industry, Trade and Tourism 21.

Ministry of Sugar 22.

Ministry of Public Enterprise 23.

Ministry of Local Government and Housing 24.

Ministry of Waterways Common Key Findings Emphasis of Matter/Other Matters           A total 245 common key findings were reported in the sector reports across the 37 Ministries and Departments.
The findings are categorised according to the account areas as shown in Figure 3.1 below.

Figure 3.1: Common Audit Findings across Ministries/Departments Common Key Audit Findings s a e r A t n u o c c A Records Management Capital projects Trading and Manufacturing Account Inventory Financial statements Journals Board of Survey Expenditure Revenue Property, Plant and Equipment Underline Accounts… Payroll Governance Others 9 11 14 5 8 1 4 5 6 23 20 30 58 51 0 No.
of Audit Findings _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 29 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 3.2 Quality of Draft Agency Financial Statements We assessed the quality of financial statements by the extent of audit adjustments made to draft financial statements which indicate the effectiveness of the agency’s internal review processes to identify and correct errors before financial statements are provided for audit.
Refer to the Table below for the rating: Rating Quality of draft financial statements assessment  Effective No adjustments or resubmission of financial statements were required  Generally effective Adjustments on operating results/net assets were less than 1% (< 1%)  Ineffective • Adjustments on operating results/net assets were more than 1% (> 1%) • Re-submissions of draft financial statements Of the 37 Ministries and Departments, 26 or 70% submitted quality draft financial statements for audit.
The quality of draft financial statements submitted by 11 Ministries and Departments were considered unsatisfactory/ineffective.

Refer to Figure 3.2 for details.
Figure 3.2: Quality of Draft Financial Statements Quality of Financial Statements (Q) 20 18 16 14 12 10 8 6 4 2 0 19 •Office of the President, Office of the Prime Minister, Office of the Attorney General, Ministry of iTaukei Affairs, Ministry Defence and National Security, Ministry of Employment, Productivity and Industrial Relations, Ministry of Foreign Affairs, the Director of Public Judiciary, Parliament, Office of and Prosecutions, Ministry Meteorological Services, Ministry of Justice, Ministry of Communication, Ministry of Civil Service, Ministry of Rural and Maritime Development, Ministry of Women, Children and Poverty Alleviation, Ministry of Lands and Mineral Resources, Ministry of Sugar and Ministry of Waterways Disaster Management of EFFECTIVE 11 7 GENERALLY EFFECTIVE •Information, Technology & Computing Services, Republic of Fiji Military Forces, Peacekeeping Missions, Ministry of Youth and Sports, Ministry of Industry, Trade and Tourism, Ministry of Environment and Ministry of Infrastructure and Transport.
Effective Generally Effective Ineffective INEEFFECTIVE •Ministry of Economy, Fiji Corrections Service, Fiji Police Force, Ministry of Education, Heritage and Arts, Ministry of Health and Medical Services, Department of Housing, Ministry of Agriculture, Ministry of Fisheries, Ministry of Forests, Ministry of Public Enterprise and Ministry of Local Government and Housing.
_________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 30 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 3.3 Timeliness of Financial Reporting To assess the timeliness of submission of acceptable draft financial statements, we compared the date the draft financial statements were received to the deadline set by the Ministry of Economy.
To assess the timeliness of acceptable draft financial statements, we have compared the date the draft financial statements were due and the date it was received.
Rating  Effective  Generally effective  Ineffective Timeliness of draft financial statements assessment Acceptable draft financial statements received before or on 15 October 2018 Acceptable draft financial statements received on or before 31 October 2018 Acceptable draft financial statements received after 15 November 2018 92% of Ministries and Departments did not meet the due date for submission of draft financial statements for audit.
Refer to Table 3.5 below for details: Table 3.5: Submission of Draft Financial Statements by 31 October 2018 Met the timeline X Did not meet timeline Ministry/Department Meeting Timelines General Administration 1.

Office of the President 2.

Office of the Prime Minister and Department of Immigration 3.

Office of the Attorney General 4.

Ministry of Economy 5.

Ministry of iTaukei Affairs 6.

Ministry of Defence and National Security 7.

Ministry of Employment, Productivity and Industrial Relations 8.
Ministry of Foreign Affairs 9.

Judiciary 10.

Parliament 11.

Office of the Director of Public Prosecutions 12.

Ministry of Disaster Management and Meteorological Services 13.

Ministry of Justice 14.

Fiji Corrections Service 15.

Ministry of Communication 16.

Department of Information, Technology and Computing Services (ITC) 17.

Ministry of Civil Service 18.

Ministry of Rural and Maritime Development 19.

Republic of Fiji Military Forces 20.


Fiji Police Force 21 Peacekeeping Missions Social Services 22 Ministry of Education, Heritage and Arts 23.

Ministry of Health and Medical Services 24.

Department of Housing 25.


Ministry of Women, Children and Poverty Alleviation X X  X X X X X X X  X X X X X X X  X X X X X X _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 31 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Ministry/Department 26.

Ministry of Youth and Sports Economic Services 27.

Ministry of Agriculture 28.

Ministry of Fisheries 29.


Ministry of Forests 30.

Ministry of Lands and Mineral Resources 31.

Ministry of Industry, Trade and Tourism 32.

Ministry of Sugar 33.

Ministry of Public Enterprise 34.

Ministry of Local Government and Housing 35.Ministry of Environment 36.

Ministry of Infrastructure and Transport 37.


Ministry of Waterways 3.4 Year-End Closing Process Meeting Timelines X X X X X X X X X X X X A quality financial statements preparation process will reduce the risk of untimely, inaccurate and unreliable financial reporting.

On 12 June 2018, the Permanent Secretary for Economy issued Circular No.
03/2018 to Permanent Secretaries, Heads of Departments, High Commissioners and Ambassadors in Fiji Overseas Missions in which procedures for closing of 2018 accounts and timelines were detailed.
The key focus areas in the Circular include: • Retirement of imprests by 20 July 2018 • Cancellation of unprocessed purchase orders by 27 July 2018 • Processing of virements by 20 July 201 and payments 31 July 2018 • Monitoring of un-presented cheques by 31 July 2018 • Clearance of Inter-departmental clearance accounts by 3 August 2018 • Closing date for journal adjustments by 10 August 2018 • Clearance of stale cheques by 22 August 2018 • Annual Board of Survey on Drawings Account cheques by 22 August 2018 • Completion of reconciliations by 29 August 2018 • Submission of arrears of revenue returns by 31 August 2018 When Ministries and Departments achieve the key focus areas highlighted by the Permanent Secretary for Economy by the due dates, they are more likely to prepare accurate and timely draft financial statements for audit.
There were 10 key focus areas in the 2018 closing of accounts.
The year-end closing of accounts process ratings for Ministries and Departments were determined by classifying them into either effective, generally ineffective or ineffective as follows: Rating Year-end close process assessment  Effective  Generally effective  Ineffective All 10 key processes completed by due date Five of 10 key processes completed within two weeks of due date Less than five of 10 key processes completed within two weeks of due date _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 32 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Of the 37 Ministries and Departments, nine (9) completed all processes by the due dates.
Twenty two (22) Ministries and Departments completed 5 of 10 key processes within 2 weeks of due dates and were categorized as effective and generally effective respectively.

Six (6) Ministries and Departments were ineffective as they completed less than 5 of 10 key processes within two weeks of the due date.

Refer to Figure 3.3 below.


Figure 3.3: Compliance with Year-End Closing Processes Compliance to Year End Procedures (YE) 22 9 EFFECTIVE GENERALLY EFFECTIVE of the Director •Office of the President, Office of the Attorney General, Parliament, Office Public Prosecutions, Ministry of Disaster Management and Meteorological Services, Ministry of Communication, Information, Services, Ministry of Industry, Trade and Tourism and Ministry of Sugar.
Technology & Computing of of Security, Ministry Judiciary, Ministry of •Office of the Prime Minister, Minstry of Economy, iTaukei Affairs, Ministry Defence and Ministry of National Employment, Productivity and Industrial Relations, Ministry of Justice, Fiji Foreign Affairs, Corrections Service, Ministry of Civil Service, Ministry of Rural and Maritime Development , Republic of Fiji Military Fiji Police Force, Peacekeeping Missions, Ministry of Women, Children and Poverty Alleviation, Ministry of Youth and Sports, Ministry of Agriculture, Ministry of Fisheries, Ministry of Lands and Mineral Resources, Ministry of Public Enterprise, Ministry of Infrastructure and Transport and Ministry of Waterways Forces, 6 INEEFFECTIVE •Ministry of Education, Heritage and Arts, Ministry of Health and Medical Services, Department of Housing, Ministry of Forests, Ministry of Local Government and Housing and Ministry of Environment.
Effective Generally Effective Ineffective 25 20 15 10 5 0 _________________________________________________________________________________________________ Report on 2017- 2018 Financial Statements of Government & Annual Appropriation Statement 33 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 4.0 FINANCIAL STATEMENTS OF GOVERNMENT 4.1 Introduction The Permanent Secretary for Economy prepares the consolidated financial statements of Government annually.
These financial statements are prepared in accordance with the Cash-basis IPSAS reporting requirements and Cabinet Decision 277 of 2010.

Additional disclosures are also made in accordance with the requirements of FMA 2004.

Some statements forming part of the financial statements were drawn up using modified-cash basis balances from the FMIS general ledger.
Consolidated Fund Reporting The FMA 2004 requires that all public money is to be paid into the Consolidated Fund unless it is required to be paid to another fund or retained by the authority receiving it by written law.

Trust money is not payable into the Consolidated Fund.

Except for payments made in error or not public money and refunds of unclaimed money, withdrawals can only be made from the Consolidated Fund under an appropriation made by law.
This report covers the following transactions for the financial year: • Operating revenue including taxes, revenue from investments including those from operation of TMAs; • Expenditures incurred for unallocable items; • Government borrowings and repayments; • Government guarantees and other contingent liabilities; and • Government assets and liabilities.
Consolidated Trust Account FMA 2004 states that trust money is to be accounted for separately from public money and other money and is to be kept in a separate bank account pending withdrawal.

Trust monies are to be utilized for purposes related to the objectives of the trust and accounted for, banked, invested, reported and otherwise controlled in accordance with FI 2010.

This report covers the trust fund receipts and payments for the financial year.
Appropriation Statement Expenditure of money appropriated by an Appropriation Act from the Consolidated Fund or any other fund can be incurred only in accordance with the authorization effected by the Appropriation Act.

Ministries and Departments specified in the Appropriation Act concerned or the budget estimate tabled with the Bill are responsible for its administration.
The Minister for Economy or Permanent Secretary may in writing without further appropriation, authorize the transfer or virement of any unspent amount in an appropriation category within a head of appropriation to another appropriation category within the head of appropriation, other than for a Constitutional body.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 34 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI An appropriation made by an Annual Appropriation Act lapses at the end of the financial year to which it relates except where the Minister has authorized the carry over to the following year of all or part of the unused appropriation that relates to known liabilities as at a particular date, for use in the following year, subject to such conditions as the Minister specifies in the authorization.
The Minister may with the approval of Cabinet, authorize the redeployment of amounts appropriated by the most recent Annual Appropriation Act for administration by the Ministry to the heads of appropriation and appropriation categories to one or more Ministries and Departments.
As per section 10 (1) of the FI 2010, the Permanent Secretaries of the agencies may authorize the transfer of budgeted funds as follows: (a) out from SEG 1 or 2 (Established and Unestablished Staff) but shall not transfer funds into SEG 1 or 2; (b) into and out of one or more of the following operating SEGs (SEGs 3, 4, 5, 6, or 7); (c) from the operating SEGs (SEGs 1, 2, 3, 4, 5, 6, or 7) to the capital SEGs (SEGs 8, 9, or 10) but not from capital to operating or from capital to capital; and (d) virement within SEG 13 to meet the consequential VAT component of the virements in (a), (b) and (c) above.
In addition, the Permanent Secretary for Economy may authorise the transfer of the following budgeted funds in respect of all agencies: (a) within each of SEGs 1 or 2 or from SEG 1 into SEG 2 or vice versa; (b) within each of capital expenditure SEGs (SEGs 8, 9, or 10) or from SEG 8 into either SEG 8, 9, or 10 or vice versa, as the case may be; and (c) virement within SEG 13 to meet the consequential VAT component of the virements in (a) and (b) above.
This report covers payments to Ministries and Departments through appropriation, deployment of funds, virements, expenditures incurred and unspent balances.

Refer to Appropriation Statement on Table 5.13.

Quality of Financial Report The quality of the Financial Statements of Government largely depends on the reliability of the information provided to the Ministry of Economy by the Ministries and Departments.
4.2 Submission of Draft Financial Statements of Government We received the first complete draft Financial Statements of Government for audit on 29 November 2019.

Following this, amendments were made on compliance with Cash Basis IPSAS, additional disclosures and correction of errors and omissions.

Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 35 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Refer to Table 4.1 below for details.
Table 4.1: Submission of Draft Financial Statements of Government Draft Financial Statements First draft Revisions Revisions Date Received 29/11/19 26/06/20 12/08/20 Key Changes in the Financial Statements of Government There were improvements to the Financial Statements of Government for 2018 when compared to 2017.
These key changes include: Inclusion of Statement of Responsibility • • Note 16 - Controlled entities which includes all Ministries and Departments by sector • Note 45 - Land Transport Authority (LTA) Arrears of Revenue • Note 18 - Comparison of Actual and Budget Amounts 4.3 Result of Our Audit The Permanent Secretary for Economy signed the 2017/2018 Financial Statements of Government on 30 November 2020.
A modified audit opinion (qualified) with emphasis of matters and other matters on the financial statements was issued after the legislative deadline of 30 April 2019.

Basis for Qualified Audit Opinion ▪ Included in the Trust Fund Account balance of $197.7 million in the Statement of Assets and Liabilities (Schedule 3) is Main Trust amounting to $161.2 million (Note 32).
Main Trust Fund Account balance amounting to $78.4 million was not supported with detailed listing of claimants of the monies held in the trust.

Hence, audit was not able to confirm the accuracy and completeness of the Trust Fund Account balance of $197.7 million as at 31 July 2018.

Emphasis of Matters ▪ Included in Accounts Receivable of $$153.6 million in the Statement of Assets and Liabilities (Schedule 3), is Tax Receivables-IRD and Customs amounting to $151 million.
Detailed Listings were not provided to support these amounts.

Consequently, audit was not able to ascertain the accuracy and completeness of the Accounts Receivable balance as at 31 July 2018.

▪ Established Staff and Government Wage Earners Payroll expenditure in the Statement of Cash Receipts and Payments amounted to $959.3 million.

An unreconciled variance of $9.6 million exists between FMIS general Ledger and the Payroll Report for both Established Staff and Government Wage Earners.
▪ Reflected in the Statement of Assets and Liabilities (Schedule 3) is cash of $286.7 million.

A variance of $1.1 million existed between the FMIS general ledger balance and the bank reconciliation statement.

▪ Note 52 of the financial statements discloses the novel coronavirus (COVID-19) global pandemic impact subsequent to 31 July 2018.

No adjustment has been made to the financial statements as at 31 July 2018 for the financial implications.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 36 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Other Matters • Internal controls were generally found to be weak for the Department of Immigration, Ministry of Employment, Productivity and Industrial Relations, Ministry of Foreign Affairs, Ministry of Disaster Management and Meteorological Services, Fiji Correction Services, Fiji Police Force, Ministry of Education, Heritage & Arts, Ministry of Health & Medical Services, Department of Housing, Ministry of Women, Children and Poverty Alleviation, Ministry of Agriculture, Ministry of Fisheries and Ministry of Forestry.
• The Fiji Roads Authority, as implementing agency for the Suva Ariel Roads Upgrading Project (SARUP 1), under the Transport Infrastructure Investment Sector Project ABD Loan No.

3210- FIJ, did not comply with the Implementation Arrangements set forth in the Project Administration Manual stated in the Loan Agreement.

The Project Administration Manual required that the ADB Procurement Guidelines be followed for the procurement of goods and works.
The Authority prepared the contract agreement for Contract No.

FRA/TIISP/16-01 Suva Ariel Roads Upgrading Project (SARUP 1) under FRA general terms and conditions but ADB determined a misprocurement as some amendments were made to the FIDIC clauses.

As a result, SARUP 1 project will no longer be funded by the ADB and World Bank, the Government of Fiji will incur the full cost of the project totalling $30.4 million.
The funds that have been disbursed by ADB as at 31/07/18 totalling $5.7 million and World Bank totalling $3 million will be submitted with FRA/TIISP/16-03 Road Reseals Programme of Roads in Western, Central and Northern Divisions of Fiji.

The Government of Fiji will be responsible to pay the full remaining balance of $20.4 million.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 37 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 5.0 FINANCIAL POSITION, PERFORMANCE AND SUSTAINABILITY 5.1 Introduction Our analysis cover the key components of the financial statements which are revenue, expenditure, assets and liabilities.

The detailed analysis are provided in Appendix B.


The primary objective of our analysis is to assist users understand the Financial Statements of Government by clarifying the financial effects of key transactions and events in 2017/2018.

Financial statements also assist users understand the sustainability of government.
Operating margin The Operating margin ratio for the year ended 31/07/18 was 1.52 (2017 – 1.63 ), indicating that for every $1 of operating expenses there is $1.52 of operating revenue to meet those operating expenses.

Current ratio This ratio shows the amount of current assets available to meet current liabilities as they fall due.

The current ratio as at 31/07/18 was 0.52 (2017 – 0.67), which was below the benchmark 1.0 indicating a net working capital deficit.
Debt to equity ratio Debt to equity ratio as at 31/07/18 was 1: 1.73 (2017 – 1:1.37).

This shows that for every $1 of equity, $1.73 is owed to creditors and lenders.

Sectors of government covered In this chapter, we assess the position, performance and sustainability of government as reported in the Financial Statements of Government.
These financial statements report on the consolidated position of the Government comprising of the general administration, social services, economic services, infrastructure services sectors and those which are unallocable.

5.2 Assessing Position and Performance We measure performance by looking at the net operating balance for the financial year.

This is a measure of the normal operations of Government and indicates whether government is earning more than it spends.
We measure financial position by looking at the net worth or equity at the end of the financial year.

This indicates the degree to which government’s assets exceeds liabilities and indicates the extent to which government would be able to absorb unexpected adverse economic conditions.

We assess sustainability by considering how government’s position and performance change over time.

We also consider how government is able to fund both day to day operations and its investment in assets.
This includes an assessment of whether the revenue the government earns Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 38 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI is sufficient to finance its operations and capital investments or whether it needs to borrow for these purposes.

5.2.1 Net Operating Balance Figure 5.1 shows negative net operating balance for 2018 and 2017 below.
Figure 5.1: Net Operating Balance Net Operating Balance (217.74) 2017 2018 (492.09) (600.00) (500.00) (400.00) (300.00) (200.00) (100.00) 0.00 ($Millions) Net Operating Balance Net operating result with and without capital expenditures is shown in Table 5.1 below.
Table 5.1: Net Operating result Revenue (Includes TMA revenue) Expenses (Includes TMA expenses) Expenses (Without Capital Expenses) Overall Net Operating Deficit Net Operating Surplus without Capital Expenses 31/07/18 ($) 3,262,410,200 3,754,502,992 2,372,219,327 (492,092,792) 890,190,873 31/07/17 ($) 2,859,097,304 3,076,840,916 2051,239,121 (217,743,612) 807,858,183 The net operating result remained at a deficit from 2014.

Refer to Figure 5.2 for trend of net operating result for the past five years.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 39 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 5.2: Trend for Net Operating Result Source: Financial Statements of Government for 2015 to 2018 5.2.2 Equity As at 31 July 2018, the Financial Statement of Government showed net assets deficiency of $3.2 billion.

Refer to Table 5.2 below for details.


Table 5.2: Net Assets Deficiency Total Assets ($) Total Liability ($) Net Assets Deficiency ($) 2,352,524,110 5,585,428,948 3,232,904,838 Changes in net assets/equity between two reporting dates reflect the increase or decrease in net assets/liabilities during the period.8 Figure 5.3 below shows the total assets, total liabilities and net equity balances for the past 5 years.
8 IPSAS 1 - Presentation of Financial Statements, Section 120 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 40 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 5.3: Equity balance Trend Analysis s n o i l l i M ) $ ( 3,000.0 2,000.0 1,000.0 - (1,000.0) (2,000.0) (3,000.0) (4,000.0) (5,000.0) (6,000.0) Equity Balance Trend Analysis 2,352.5 992.0 958.0 1,150.5 1,331.1 2014 2015 2016 2017 2018 (3,192.0) (3,469.8) (3,599.5) (3,633.9) (3,232.9) (4,184.0) (4,427.8) (4,749.9) Year (4,964.9) (5,585.4) Assets Liabilities Net Asset Deficiency Total liabilities had an increasing trend while total assets fluctuated over the past 5 years.
The decrease in equity balance in 2018 was due to increase in equity investments and term loan receivable as a result of recognition of outstanding debt from Tertiary Education Loans Scheme (TELS) due to government.

5.2.3 Contingent Liabilities The Government under the authority of the Parliament provides guarantee for the financial liability of State entities in respect of loans or otherwise.
A contingent liability is a potential liability that may or may not become due, depending on whether a possible event occurs, such as a claim for compensation, an indemnity or other legal claims.

Government contingent liabilities are classified into broad two categories namely Government Guarantee (explicit) and Other Contingent Liabilities (implicit).

In Government Guarantee (explicit) the government’s obligation is defined by the deed of guarantee.
The government is legally mandated to settle an obligation should the respective borrowing entity default on its loan repayments.

Other contingent liabilities (implicit) includes guarantee such as that of international agencies securities accounts, and Municipal and Provisional Council’s borrowings which contribute to the overall public sector risk.
These are classified differently on the basis that no deed of guarantee exists for the contingent liabilities and are not officially recognized until a failure occurs.9 Government Guarantees (explicit) is further classified into two sub-sections, explicit and other explicit.
9 Contingent Liability Report as at 31 July 2017, Debt Management Unit Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 41 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI The total contingent liabilities as at 31 July 2018 was $ 1.15 billion.

The contingent liabilities balance increased by $93.4 million or 9% compared to the balance of $1.06 billion in 2017.

Refer to Figure 5.4 for a trend analysis of the balances over the past years.
Figure 5.4: Trend analysis of Contingent Liabilities Government Guarantees 2014 - 2018 2.5 0.9 1.3 1.1 1.2 s n o i l l i B ) $ ( 3 2.5 2 1.5 1 0.5 0 2014 2015 2016 (7 months) 2017 2018 Years The increase in Government’s total contingent liability in 2018 was mainly due to new loan guarantees, as approved by Parliament, to the Fiji Development Bank of $97.3 million, Fiji Sugar Corporation Limited of $151 million, Pacific Fishing Company Limited of $2.8 million and increase in other explicit contingent liabilities for International Bank of Reconstruction and Development (IBRD) and Asian Development Bank (ADB) due to changes in exchange rates for callable portions from USD to FJD.
For the year ending 31 July 2018, callable capital subscribed in IBRD and ADB were noted at significant balances of $303.0 million or 26% and $202.2 million or 18% of total contingent liability, respectively.

The changes in the balances was attributed to the exchange rates used in the conversion of the ‘callable portions’.

Refer to Figure 5.5 for composition of contingent liabilities as at 31/07/18.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 42 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 5.5: Composition of contingent liabilities as at 31/07/18 $24m Fiji Sugar Corporation Limited $202m $35m $2m $1m $210m Fiji Development Bank Fiji Electricity Authority Housing Authority $303m $2m $3m $5m $13m $60m $200m Fiji Broadcasting Corporation Fiji Hardwood Corporation Pacific Fishing Company Limited $94m Fiji Pine Limited International Bank for Reconstrcution and Development (IBRD) Asian Development Bank (ADB) 5.3 Understanding Financial Performance The net operating balance is used to measure financial performance.
It shows the difference between revenue earned and expenses incurred from day-to-day operations.

Refer to Table 5.3 for details.


Table 5.3: Net operating deficit Revenue (Includes TMA revenue) Expenses (Includes TMA expenses) Overall Net Operating Deficit 31/07/18 ($) 3,262,410,200 3,754,502,992 (492,092,792) 31/07/17 ($) 2,859,097,304 3,076,840,916 (217,743,612) The net deficit as per budget estimates was $499.5 million compared to the actual net operating deficit for the year ended of $492.1 million, a reduction by $7.4 million.
This was due to actual total expenditure of $3.7 billion being within budget.

Operating ratio shows the percentage of operating expenses for every $1 of operating revenue.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 43 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 5.6: Operating ratio 67% 66% 65% 64% 63% 62% 61% 60% 59% ) % ( e g a t n e c r e P Operating Ratio 66% 61% 31/07/18 31/07/17 Years In 2017, Government had an operating ratio of 61%, from every $1 of operating revenue the government paid out $0.61 for operating expenses.

The remaining 39% was available for use for non-operating expenses.
In 2018, the operating ratio increased to 66% indicating that 34% of revenue was available for non- operating expenses or capital expenditures.

5.3.1 Revenue The total forecasted revenue by Government in 2018 was $3.8 billion which comprised of operating revenue of $3.3 billion and investing revenue of $525 million.

There was no forecasted revenue for government Trading and Manufacturing operations.
However, the actual revenue collections by government in 2018 from its normal operations totalled $3.2 billion, thus a shortfall of $612.8 million or 16% of the total estimated revenue.

The anticipated sale of government assets did not take place during the financial year 2018 which contributed to the shortfall in revenue.

Government budgeted $371.8 million from sale of Government assets as investing receipts, which was largely anticipated from the planned divestment of Energy Fiji Limited (EFL).
The other contributing factor to the shortfall in revenue was due to zero collection of other various budgeted revenue.

Refer to the Table 5.4 below.
Table 5.4: Budgeted revenue with zero collections Revenue Description Withholding & Dividend Taxes Health Levy Light Due - Port & Harbour Coasting Rental for Buildings Hire of Vessels and Punts Sale of Photograph Reimbursement of WALESI Digital Television Budgeted Amount ($) 112,832,859 3,857,240 1,375 7,077 301 8,100 101 14,385,294 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 44 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Revenue Description UN International Peacekeeping United Nations Development Programme China Government Grants Japan Government Grants Interest Public Officers & Ministers Interest Economic Service Term Loan Dividends - Investments in Social Services Total Figure 5.7: Categories of Revenue Budgeted Amount ($) 4,200,000 1,078,806 1,710,859 2,537,084 184,261 220,849 1,730,252 142,754,458 Reimbursements and Recoveries 0.6% Other Revenues and Surpluses 1.1% Fees, Charges, Fines and Penalties 4.4% Grants in Aid (overseas) 1.5% Dividend from Investments 4.6% Trading and Manufacturing Account … Others 0.4% Direct Taxes 25.3% Indirect Taxes 61.5% Other revenue of 0.5% is made up of operating revenue surplus, interest received on term loan receivable, sale of government assets, interest from bank balances, return of surplus capital from investment and term loan receivable.
Comparison of actual revenue for 2018 and 2017 is shown in Figure 5.8 below.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 45 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 5.8: Comparison of Actual Revenue for 2018 and 2017 Comparison of Revenue between 2018 and 2017 ) $ ( t n u o m A 3,500,000,000 3,000,000,000 2,500,000,000 2,000,000,000 1,500,000,000 1,000,000,000 500,000,000 - Operating Revenue Investing Revenue Types of Revenue Total Revenue Trade and Manufacturing Operations 31/07/2018 31/07/2017 Total revenue in 2018 increased by $403 million or 14% from 2017.
The increase in revenue was due to increased collection of direct taxes by $59.7 million or 7.8%, Indirect taxes by $192.8 million or 10.5%, fees, fines and charges by $15.1 million or 11.8%, grant aid from $30.7 million or 163% and repayments of term loans receivable by $4.6 million or 329.9%.

Comparison of estimated and actual revenue is shown in the Figure 5.9 below.
Figure 5.9: Comparison of Estimated and Actual Revenue as at 31 July 2018 Comparison of Budgeted and Actual Revenue ) $ ( t n u o m A 4,500,000,000 4,000,000,000 3,500,000,000 3,000,000,000 2,500,000,000 2,000,000,000 1,500,000,000 1,000,000,000 500,000,000 - Operating Revenue Investing Revenue Types of Revenue Trade and Manufacturing Operations Total Revenue Budgeted Revenue Actual Revenue Operating revenue comprised 94% total revenue, 5% investing revenue and revenue from TMA operations 1%.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 46 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Major revenue types were indirect taxes of $2 billion or 61.5%, direct taxes of $825.7 million or 25% and fees, fines and charges of $143 million or 4%.

5.3.2 Expenditure The total revised expenditures estimate was $4.3 billion with actual expenditure of $3.7 billion resulting in savings of $615.7 million or 14%.
Figure 5.10 shows the percentage utilization of expenditure by SEGs.
Figure 5.10: Utilization of Government Expenditure by SEGs Pensions, Gratuities & Compassionate Allowances 1% Capital Grants and Transfers 32% Capital Purchase 2% Charges on Account of Public Debt 8% Value Added Tax 1% Established Staff 24% Unestablished Staff 2% Travel and Communications 1% Maintenance and Operations 2% Capital Construction 3% Special Expenditures 2% Purchase of Goods and Services 4% Operating Grants and Transfers 18% Comparison of actual expenditure for 2018 and 2017 is shown in Figure 5.11 below.
Figure 5.11: Comparison of Actual Expenditure for 2017 and 2018 Comparison of 2018 and 2017 Actual Expenditure ) $ ( t n u o m A 4,000,000,000 3,500,000,000 3,000,000,000 2,500,000,000 2,000,000,000 1,500,000,000 1,000,000,000 500,000,000 - Operating Expenditure Capital Expenditure Value added Tax Interest Payments on Loans Trading and Manufacturing Accounts Total Type of Expenditure Actual Expenditure 2018 Actual Expenditure 2017 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 47 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI The actual expenditures increased by $677.7 million or 22% in 2018 in comparison to 2017.
The increase in expenditure was due to increase in expenditures for established staff by $99.8 million or 12%, government wage earners by $5.5 million or 10%, travel and communication by $1.9 million or 5%, maintenance and operations by $5.5 million or 8%, purchase of goods and services by $11.0 million or 8%, operating grants and transfers by $161.7 million or 31%, special expenditures by $20.4 million or 30%, capital construction by $19.9 million or 24%, capital purchases by $27.1 million or 56% and capital grants and transfers by $309.7 million or 35%.
Comparison of revised estimate and actual expenditures is shown in Figure 5.12 below.

Figure 5.12: Comparison of Revised Estimate and Actual Expenditure Comparison of Budgeted and Actual Expenditure ) $ ( t n u o m A 5,000,000,000 4,500,000,000 4,000,000,000 3,500,000,000 3,000,000,000 2,500,000,000 2,000,000,000 1,500,000,000 1,000,000,000 500,000,000 - Revised Budget Actual Expenditure SEGs 1 to 13 recorded savings resulting in overall savings of $615.7 million or 14%.
Significant savings were for recorded established staff of $84.2 million, special expenditures of $$30.1 million, operating grants and transfers of $$39.3 million and Capital construction, purchases, grants and transfers of $370.1 million.

Total expenditures comprised operating expenditure of 54%, capital expenditure of 36.5%, charges on public debt was 8%, value added tax was 1% and Trading and Manufacturing Account expenditure was 0.5%.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 48 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Payroll expenditures The total Government payroll expenditure for 2018 was $959.3 million with 94% or $900.3 million paid to Established Staff while 6% or $58.9 million to Government Wage Earners.

Refer to Table 5.5 below for comparison of revised estimate and actual expenditure.
Table 5.5: Comparison of Revised Estimate and Actual Expenditure for Payroll SEG Description 1 2 Established Staff Government Wage Earners Total Revised Estimate ($) Actual Expenditure ($) 984,511,899 63,762,237 1,048,274,136 900,309,981 58,949,182 959,259,163 Variance Percentage ($) 84,201,918 4,813,055 89,014,973 9% 8% 8% The total payroll expenditure was $959.3 million against a revised budget of $1.05 billion resulting in a saving of $89 million.
The savings was due to the number of vacant positions not filled across Ministries/Departments.

Payroll expenditure increased by $105.3 million in 2018 compared to 2017.

This was due to the implementation of the Job Evaluation Exercise across the whole of Government.

Refer to Table 5.6 below for comparison of revised and actual payroll expenditure for 2018.
Table 5.6: Comparison of Actual Payroll Expenditure for 2018 SEG SEG Description 1 2 Established Staff Government Wage Earners Total Revised Estimate ($) 900,309,981 58,949,182 959,259,163 Actual Expenditure ($) 800,546,116 53,462,154 854,008,270 Variance Percentage ($) 99,763,865 5,487,028 105,250,893 12% 10% 12% Total number of employees for established staff and government wage earners for 2018 and 2017 are shown in Table 5.7 below.
Table 5.7: Payroll details 2018 2017 Established Staff Actual Payroll Expenditure Number of Employees Average Cost per employee Government Wage Earners Actual Payroll Number of Employees Average Cost per employee Overall Total Actual Payroll Number of Employees $900,309,981 $800,546,116 23,932 $33,451 26,283 $34,254 $58,949,182 4,263 $13,828 $53,462,154 4,642 $11,157 $959,259,163 $854,008,270 28,574 30,546 Source: Number of employees was extracted from payroll reports.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 49 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI The total number employed by the Government was 30,546 as at 31 July 2018 which increased by 1,972 or 7% from 2017.
5.3.3 Results from operation of Trading & Manufacturing Accounts Total revenue and expenses arising from Trading and Manufacturing operations administered by Ministries and Department were $18 million and $13.4 million respectively resulting in a surplus of $4.6 million for 2018.

5.3.4 Trust Fund Accounts The trust fund account consisted of operating trust and main trust fund accounts.
The operating trust fund account records payroll deductions including income tax, superannuation contributions (FNPF) and other payments to third parties.

The main trust fund account records tender deposits, retention monies and trust funds set up for specific activities within Ministries/Departments.

The total trust fund account balance for the year ended 31 July 2018 was $197.7 million.

Refer to Table 5.8 below.


Table 5.8: Trust fund account balances Deposits, Deductions and Retention Consolidated Trust Fund (Main Trust Fund Account) Total 31/07/18 ($) 36,459,911 31/07/17 ($) 28,368,369 161,241,215 168,831,120 Variance ($) 8,091,542 (7,589,905) 197,701,126 197,199,489 501,637 The operating trust fund account balance as at 31 July 2018 was $36.5 million, an increase of $8 million.

This indicated that operating trust accounts were not cleared on time.
In addition, the inclusion of dormant accounts, carried forward balances and new Trust Fund accounts also contributed to the increase.

In comparison, the consolidated trust fund account balance as at 31 July 2018 was $161.2 million which decreased by $7.6 million or 4% from 2017.

The cash balances for the main trust fund account as at 31 July 2018 was $161 million which is sufficient to cover 99% of the main trust fund account liability of $161.2 million.
However, the operating trust fund accounts do not have separate bank accounts and funds from the consolidated fund account is used to settle payments.

The domestic cash at bank balance net of unpresented cheques as at 31 July 2018 was $92.4 million which was more than sufficient to cover total operating trust fund account balance of $36.5 million.

This shows that 39% of the total net domestic cash as at 31/07/18 was utilized to settle payments for operating trust fund account.
5.3.5 Investments Total investments in 2018 of $1.3 billion increased by $895.6 million compared to 2017, due to: Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 50 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI • • • • increase in share prices for Amalgamated Telecom Holdings Limited and Unit Trust of Fiji (Trustee) Limited; new investments in Energy Fiji Limited; subscription of additional shares in International Bank for Reconstruction; and increase Development and Asian Development Bank due to exchange rate adjustments.
investment for International Bank for Reconstruction and in value of There was no sale of investments for the year ended 2018.

Government investments in the Infrastructure Sector was the major component which made up 82% or $1.09 billion while the remaining $237 million or 18 % were in the Economic Services Sector and 1% or $6.9 million in the Social Services Sector.

Refer to Figure 5.13 below for the composition of Government investments by sector.
Figure 5.13: Composition of Investment by Sector 1% 18% 82% Investments in Social Services Investments in Economic Services Investments in Infrastructure Services Changes in investment from 2017 to 2018 is shown in Table 5.9 below.
Table 5.9: Changes in investment by sector Description Investment in Social Services Post Fiji Limited Unit Trust of Fiji (Trustee) Limited Unit Trust of Fiji (Management) Limited Fiji Broadcasting Corporation Limited Walesi Limited Fiji Public Trustee Corporation Limited Total Investment in Economic Services Fiji Airways Limited Fiji Hardwood Corporation Limited Pacific Fishing Company Limited Assets Fiji Limited Fiji Pine Limited 2018 ($) 5,600,000 1,066,563 50,000 200,002 100 2 6,916,667 2017 ($) Increase/ (Decrease) ($) 5,600,000 778,839 50,000 200,002 100 2 6,628,943 --- 287,724 --- --- --- 287,724 13,307,075 90,000,000 14,728,956 2 61,002,064 13,307,075 90,000,000 14,728,956 2 61,002,064 --- --- --- --- --- 51 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Description Fiji Sugar Corporation Limited Rewa Rice Limited Viti Corps Company Limited Yaqara Pastoral Company Limited Food Processors (Fiji) Limited Air Terminal Services International Finance Corporation International Bank Development Copra Millers Fiji Limited Asian Infrastructure Investment Bank Asian Development Bank Subscription Total for Reconstruction and Investment in Infrastructure Services Airports (Fiji) Limited Amalgamated Telecom Holdings Limited Fiji Ports Corporation Limited Energy Fiji Limited Total 2018 ($) 15,119,580 1,506,224 6,000,000 1,191,846 687,679 765,000 603,068 14,079,364 2017 ($) 15,119,580 1,506,224 6,000,000 1,191,846 687,679 765,000 577,349 9,634,905 6,429,183 1,050,641 10,644,615 237,115,297 6,429,183 --- 10,207,208 231,157,071 Increase/ (Decrease) ($) --- --- --- --- --- --- 25,719 4,444,459 --- 1,050,641 437,407 5,958,226 92,300,180 219,627,976 29,993,490 749,952,450 1,091,874,096 92,300,180 80,262,716 29,993,490 --- 202,556,386 --- 139,365,261 --- 749,952,450 889,317,711 Total Investments 1,335,906,061 440,342,400 895,563,661 5.3.6 Term Loan Receivable Term loan receivable as at 31/07/18 was $572.2 million.
Refer to Table 5.10 below for details.
Table 5.10: Term loans Receivable by Sector Description Term Loan Receivables Services Public Officers and Ministers for Social I Taukei Affairs Board PSC Scholarship Lending Tertiary Education Loan Scheme Loans to Fiji Sports Council Total Term Loan Receivables for Economic Services Fiji Pine Commission Fiji Sugar Corporation Limited Viti Corporation Limited National Trading Corporation Limited Rewa Rice Limited Pacific Fishing Company Limited South Pacific Fertilizer Housing Authority Public Rental Board Total 2018 ($) 2017 ($) Increase/ (Decrease) ($) 14,476 14,476 --- 5,678,924 9,049,544 302,511,888 4,450,611 321,705,443 5,778,924 9,041,153 209,060,301 4,450,611 228,345,465 (100,000) 8,391 93,451,587 --- 93,359,978 7,200,000 173,816,930 2,905,000 1,900,000 1,900,000 9,000,000 9,722,100 34,740,200 9,309,633 250,493,863 8,400,000 173,816,930 2,905,000 1,900,000 1,900,000 9,000,162 9,722,100 36,230,048 9,708,881 253,583,121 (1,200,000) --- --- --- --- (162) --- (1,489,848.28) (399,248) (3,089,258) Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 52 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Description 2018 ($) Total Term Loan Receivable 572,199,306 2017 ($) 481,928,586 Increase/ (Decrease) ($) 90,270,720 The term loan receivable balances increased by $90.3 million or 19% compared to 2017, as a result of an increase in outstanding debt from Tertiary Education Loans Board by $93.5 million.
5.3.7 Arrears of revenue Arrears of revenue in 2018 was $107.3 million, an increase of $17.1 million or 19% in comparison to 2017.

The increase was mainly due to increases in arrears of revenue for Ministry of Communications by $812,917, Department of Lands by $1.7 million, Land Transport Authority by $11.o million, Public Utilities (Water Authority of Fiji) by $2.8 million and Ministry of Rural and Maritime Development $1.3 million.
The major proportion of debt were in relation to water rates for Water Authority of Fiji totalling $35.8 million, followed by crown land rental due to the Department of Lands of $23.5 million.

Refer to Table 5.11 and Figure 5.14 for details of arrears of revenue.
Table 5.11: 2018 Arrears of Revenue Ministry/Department Water Authority of Fiji Department of Lands Land Transport Authority Judiciary Ministry of Communications Others Total 2018 ($) 35,827,196 2,350,041 17,616,921 13,337,274 8,412,697 8,663,684 107,358,184 Percentage 33% 22% 16% 12% 8% 8% Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 53 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 5.14: Composition of Arrears of Revenue Ministry of Communications, 8% Others 8% Judiciary, 12% Land Transport Authority, 16% Public Utilities (Water Authority of Fiji), 33% Department of Lands, 22% Public Utilities (Water Authority of Fiji) Department of Lands Land Transport Authority Ministry of Communications Judiciary Others 5.3.8 Accounts Payable The accounts payable balance as at 31/07/18 was $164.9 million, an increase of $69.9 million or 74% from the 2017 balance of $95 million.
The balance of $164.9 million was made up of VAT & income tax refunds outstanding of $164.2 million and withholding tax of $688,789.

5.3.9 Term Loans Payable Public debt in 2018 totalled $5.2 billion.

This comprised of domestic borrowings of $3.6 billion which made up 69% of total debt; overseas borrowings of $1.5 billion or 28%; and Treasury Bills of $185.3 million which made up the remaining 3%.

These are illustrated in Figure 5.15 below.


Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 54 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 5.15: Composition of Public Debt in 2017/2018 Overseas Loan, 28% Treasury Bils, 4% Domestic Debt, 68% Government offered its first Green Bond in four tranches in October 2017 worth a total of $100 million.
Proceeds from the issue of Fiji’s Green Bond were used to fund identified eligible projects that fall under various sectors in accordance with the Fiji Green Bond Framework and have been approved in the 2018 budget.

Government also received short term advances from the Reserve Bank of Fiji referred to as “Ways and Means”.

These advances are raised to meet immediate cash flow needs of government.

During the year, Government had utilized $26.8 million of this facility through the Reserve Bank of Fiji.
For the year ended 2018, $205.5 million was the total principal loan repayments for overseas loans and domestic loans, made up of $44.8 million and $160.7 million respectively.

Interest payments were $48.9 million for overseas loans and $240.7 million for domestic loans.

Treasury bills fees and charges were $1.8 million.

Other charges totalling $136,450 included Reserve Bank of Fiji registry fees of $130,199 and agency and management fees.
Principal repayments for external loans commencing at end of their grace period Principal repayments for external loans as shown in the Table 5.13 below will commence at the end of their respective grace periods.

The loans were signed in 2014/2015 to 2016/2017 financial year with grace period ranging from 3 to 5 years.

Aside from the Global bonds that was due in October 2020, the principal repayments for other external loans will commence in the 2019 and 2021 financial year respectively.
Refer Table 5.12 for details.

Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 55 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Table 5.12: Principal Repayments for external loans Lenders by Financial Institutions Loan agreement signed Commencement of principal repayment No.

of years lapsed Loan balance 31/07/18 ($) Supply Asian Development Bank (ADB): Transport Infrastructure loan (Loan No.
3210) and Urban Water Wastewater Management Investment Program (Loan No.

3512) Emergency for Recovery from Tropical Cyclone Winston (Loan No.

3403) Sustained Private Sector-Led Growth Reform Program (Loan No.

3667) Assistance 12/12/2014 15/06/2020 16/10/2017 15/04/2023 18/07/2016 15/11/2021 24/06/2018 15/10/2021 International Fund for Agricultural Development (IFAD) loans: Fiji Agricultural Partnership Project (Loan No.
2000000602) 3/12/2015 2020 onwards 18/07/2016 14/04/2016 15/11/2022 Infrastructure (Loan No.

World Bank/International Bank for Reconstruction and Development: IBRD Post Cyclone Winston Emergency Development Policy Operation (Loan No.

8632) Transport Investment Project 8482) Fiji Connectivity Project (Loan No.

8666) IBRD Fiscal Sustainability and Climate Resilience Development Policy Loan (Loan No.
8840) European Investment Bank Fiji Water and & Wastewater Project Total 2022 onwards 15/01/2022 15/05/2021 15/05/2023 18/04/2018 16/12/2016 10/11/2017 6 5 5 3 5 6 5 6 5 5 10,023,981 3,293,208 105,064,089 31,519,227 2,213,478 105,064,089 7,792,253 6,268,807 31,519,227 No drawdowns in FY 2017/2018 302,758,359 5.3.10 Public Debt Sustainability The total Gross Domestic Product (GDP) as at 31 July 2018 was $11.3 billion which increased by $1.5 billion or 15% from $9.9 billion in 2017.
The total debt of $5.2 billion also increased by $549 million or 12%.

Total debt as a percentage of GDP was 46% in 2018.

Total Government revenue was $3.3 billion and total debt was $5.3 billion.

Debt to revenue ratio was 1: 1.60 indicating that for every $1 of Government revenue there was $1.60 of government debt.
Interest charges on loans and other charges on public debt was $291.5 million, interest expense to revenue ratio was 1: 0.09, indicating that 9% of total revenue can be used for repayment of interest expenses on loans.

5.4 Appropriation Statement The Appropriation Statement for Government is shown in Table 5.13 below.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 56 r e d n U / ) r e v O ( e r u t i d n e p x E ) % ( 9 8 8 1 1 1 5 1 5 5 2 5 3 1 2 0 2 0 2 1 8 8 3 0 1 1 4 1 , 5 5 0 3 1 8 , 4 8 1 9 , 1 0 2 , 4 8 , 0 1 1 4 5 9 , 8 , 1 3 5 4 4 0 , 7 ) $ ( 2 8 1 , 9 4 9 , 8 5 1 8 9 , 9 0 3 , 0 0 9 5 6 7 , 4 4 4 , 8 3 9 9 6 , 4 3 4 , 5 7 ) $ ( i s g n v a S l a u t c A e r u t i d n e p x E 7 3 2 , 2 6 7 , 3 6 9 9 8 , 1 1 5 , 4 8 9 6 9 2 , 9 8 4 , 5 4 9 0 8 , 8 8 3 , 4 8 d e s i v e R e t a m i t s E ) $ ( , 1 3 1 4 2 1 , 6 , 4 7 3 2 8 4 , 6 , 3 6 4 2 1 4 , 9 , 8 3 3 7 7 7 , 4 ) $ ( - - - - - - - - - - - - ) $ ( 8 6 7 , 7 8 3 , 8 7 9 3 6 8 , 9 7 2 , 7 5 1 7 4 , 1 1 6 , 9 7 3 3 8 , 6 7 0 , 6 3 8 1 0 2 ) $ ( .
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REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 6.0 ASSESSMENT OF INTERNAL CONTROLS 6.1 Introduction In this chapter, we detail our assessment of the strength of the internal controls designed, implemented and maintained by the 37 Ministries and Departments to ensure reliable financial reporting.
We assess financial controls using the guidelines provided in the International Standards on Auditing/International Standards for Supreme Audit Institutions.

We have noted the similarities of the controls in these standards with that of the internal control framework of the Committee of the Sponsoring Organisations of the Treadway Commission (COSO), which is widely recognised as a benchmark for designing and evaluating internal controls.
Internal controls are processes designed and implemented by Permanent Secretaries, Heads of Departments and other personnel of Ministries and Departments to provide reasonable assurance about the achievement of a Ministry or Department’s objectives with regard to reliability of financial reporting effectiveness and efficiency of operations, and compliance with applicable laws and regulations.

The term “control” refers to any aspects of one or more components of internal control.
Permanent Secretaries, Heads of Departments and other personnel of Ministries and Departments are responsible for the preparation of the financial statements in accordance with the Financial Management Act 2004, and Finance Instructions 2010, and for such internal controls as they determine is necessary to enable preparation of financial statements that are free from material misstatements, whether due to fraud or error.
Internal control issues noted during our audit were reported to the Permanent Secretary or Head of Department of Ministries and Departments.

Summary of our internal control assessments for each of the 37 Ministries and Departments against each element of internal controls is shown in Appendix C 6.2 Internal Control Framework.

During our audits, we assessed the design and implementation of controls to ensure that they are suitably designed to prevent, detect and correct material misstatements.
Where audit strategy requires, we also test the operating effectiveness to ensure the internal controls are functioning as designed.

A deficiency occurs when internal controls are unable to prevent, detect or correct errors in the financial statements or where controls are missing.

A significant deficiency is a deficiency that either or alone or in combination with multiple deficiencies may lead to a material misstatement in the financial statements.

It requires immediate management action.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 58 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Internal controls are categorized against the following five components and assessed as either effective, generally effective or ineffective as follows: Rating Internal control assessment  Effective  Generally effective  Ineffective No deficiencies identified in internal controls Deficiencies identified in internal controls Significant deficiencies identified in internal controls Control Environment (CE) Control environment is the set of standards, processes and structures that provide the basis for carrying out internal controls across the entity.
These include commitment to integrity and ethical values, independence of management to exercise oversight for the development and performance of internal control, documented structures, reporting lines and appropriate authorities such as delegated levels of authority and responsibilities in the pursuit of the entity’s objectives.

It is also include commitment to attract, develop and retain competent individuals, and holding them accountable for their internal control responsibilities.
Examples of issues which fall under this category are ethical breaches, gaps in internal controls or controls are non-existent, individuals are not held accountable for breaches in control or the entities’ code of ethics, staff recruitment, and training and professional development, performance assessment and succession planning matters.
Figure 6.1: Categories of Control Environment Control Environment (CE) 13 14 10 EFFECTIVE GENERALLY EFFECTIVE 14 12 10 8 6 4 2 0 • Office of the Prime Minister, Office of the Attorney General, Ministry of Ecconomy, Mnistry of i Taukei Affairs, Ministry of Defence and National Security, Ministry of Foreign Affairs, Parliament, Office of the Director of Public Prosecution, Ministry of Disaster Management and Meteorological Services, Ministry of Justice, Ministry of Communication, Ministry of Civil Service, Ministry of Rural and Maritime Development and Ministry of Industry, Trade and Tourism.
• Office of the President, Fiji Corrections Service, Information, Technology & Computing Services, Republic of Fiji Military Force, Fiji Police Force, Peacekeeping Missions, Ministry of Women, Children and Poverty Alleviation, Ministry of Youth and Sports, Ministry of Lands and Mineral Resources, Ministry of Sugar, Ministry of Public Enterprise, Ministry of Infrastructure and Transport and Ministry of Waterways.
Effective Generally Effective Ineffective INEEFFECTIVE • Ministry of Employment,Productivity and Industrial Relations, Judiciary,Ministry of Education, Heritage and Arts, Ministry of Health and Medical Services, Department of Housing, Ministry of Agriculture, Ministry of Fisheries, Ministry of Forests, Ministry of Local Government and Housing and Ministry of Environment Of the Ministries and Departments reported, the control environment for 27 or 73% agencies were effective or generally effective.
Ten Ministries and Departments require improvement in setting standards, processes and structures for carrying out internal control across the entity.

Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 59 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Risk Assessment (RA) Risk assessment involves a dynamic process for identifying and analysing risks to achieve the entity’s objectives, forming a basis for determining how risks should be managed.
Examples of issues which would fall under this category are absence of risk management framework, operational including fraud and enterprise risks not identified, assessed and mitigated and impact of changes in business processes on controls not identified and assessed.
Figure 6.2: Categories of risk assessment Risk Assesment (RA) 16 14 12 10 8 6 4 2 0 15 11 11 Effective Generally Effective Ineffective Effective Generally Effective Ineffective EFFECTIVE • Office of the Prime Minister, Office of the Attorney General, Ministry of iTaukei Affairs, Ministry of Employment, Productivity and Industrial Relations, of Public the Director Parliament, Office of Prosecutions, Ministry of of Communication, Ministry of Civil Service, Ministry of Lands and Mineral Resources and Ministry of Industry, Trade and Tourism.
Justice, Ministry GENERALLY EFFECTIVE Fiji Corrections Service, • Office of the President, Ministry of Economy, Ministry of Defence and National Security, Ministry of Foreign Affairs, Information, Technology & Computing Service, Ministry of Rural and Maritime Development, Republic of Fiji Military Forces, Fiji Police Force, Peacekeeping Missions, Ministry of Women, Children and Poverty Alleviation, Ministry of Youth and Sports, Ministry of Fisheries, Ministry of Sugar and Ministry of Public Enterprise.
INEEFFECTIVE • Judiciary, Ministry of Disaster Management and Meteorological Services, Ministry of Education, Heritage and Arts, Ministry of Health and Medical Services, Department of Housing, Ministry of Agriculture, Ministry of Forests, Ministry of Local Government and Housing , Ministry of Environment, Ministry of Infrastructure and Transport and Ministry of Waterways Of the 37 Ministries and Departments reported, the risk assessment for 26 or 70% of agencies were effective or generally effective.
Eleven Ministries and Departments require improvement in the process for identifying and analysing risks including determining how risks should be managed.

Control Activities (CA) Control activities are established by policies and procedures to help ensure that management’s directives to mitigate risks to the achievement of objectives are carried out.

Control activities are performed at all levels of an entity and at various stages within business processes, and over the environment.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 60 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Examples of issues which would fall under this category are general controls relating to information technology, documentation of procedures which have in-built checks and balances which are aligned to the policies of the entity.
Specific control activities include those relating to authorization, performance reviews, information processing, physical controls, and segregation of duties.
Figure 6.3: Categories of control activities Control Activities (CA) EFFECTIVE 14 12 10 8 6 4 2 0 14 12 11 Effective Generally Effective Ineffective • Office of the Prime Minister, Office of the Attorney General, Parliament, Office of the Director of Public Prosecutions, Ministry of Disaster Management and Meteorological Justice, Services, Ministry Information, Technology & Computing Services, Ministry of Civil Service, Ministry of Youth and Sports, Ministry of Industry, Trade and Tourism and Ministry of Sugar.
of GENERALLY EFFECTIVE INEFFECTIVE • Ministry of Economy, Ministry of iTaukei Affairs, Ministry of Defence and National Security, Ministry of Foreign Affairs, Ministry of Justice, Fiji Corrections Service, Ministry of Rural and Maritime Development , Republic of Fiji Military Forces, Peacekeeping Missions, Ministry of Education, Heritage and Arts, Department of Housing, Ministry of Public Enterprise, Ministry of Infrastructure and Transport and Ministry of Waterways • Department of Immigration, Ministry of Employment, Productivity and Industrial Relations, Judiciary, Fiji Police Force, Ministry of Health and Medical Services, Ministry of Women, Children and Poverty Alleviation, Ministry of Agriculture, Ministry of Fisheries , Ministry of Forests, Ministry of Lands and Mineral Resources, Ministry of Local Government and Housing and Ministry of Environment.
Of the 37 Ministries and Departments reported, the control activities for 25 or 68% of agencies were effective or generally effective.

Twelve Ministries and Departments require improvement in the establishment of policies and procedures to help ensure that management’s directives to mitigate risks to the achievement of objectives.

Information and Communication Control (IC) Information is necessary for the entity to carry out internal control responsibilities in support of achievement of its objectives.
Communication occurs both internally and externally and provides the entity with the information needed to carry out day-to-day controls.

Communication enables personnel to understand internal control responsibilities and their importance for the achievement of objectives.

Examples of issues which would fall under this category are reporting to boards and line Ministries of entities on matters relating to internal controls.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 61 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 6.4: Categories of information and communication control Information and Communication Control (IC) 20 15 10 5 0 19 12 6 Effective Generally Effective Ineffective EFFECTIVE • Office of the Prime Minister, Office of the Attorney General, Ministry of Economy,Ministry of Defence and National Security, Ministry of Foreign Affairs, Parliament, Office of the Director of Public Prosecutions,Ministry of Disaster Management and Meteorological Services, Ministry of Justice, Fiji Corrections Service , Ministry of Communication, Information, Technology & Computing Services, Ministry of Civil Service, Ministry of Rural and Maritime Development, Peacekeeping Missions, Ministry of Youth and Sports, Ministry of Lands and Mineral Resources, Ministry of Industry, Trade and Tourism and Ministry of Sugar.
GENERALLY EFFECTIVE • Office of the President , Ministry of iTaukei Affairs, Ministry of Employment, Productivity and Industrial Relations, Republic of Fiji Military Forces, Ministry of Education, Heritage and Arts, Department of Housing, Ministry of Women, Children and Poverty Alleviation, Ministry of Fisheries, Ministry of Forests, of Ministry of of Infrastructure Waterways.
Public Enterprise, Ministry and Transport and Ministry INEFFECTIVE • Judiciary, Fiji Police Force, Ministry of Health and Medical Services, Ministry of Agriculture, Ministry of Local Government and Housing and Ministry of Environment.

Of the 37 Ministries and Departments reported, the information and communication control for 31 or 84% of agencies were effective or generally effective.
Six Ministries and Departments require improvement in the information and communication control to help ensure that management’s directives to mitigate risks to the achievement of objectives.

Monitoring Activities (MA) On-going evaluations, separate evaluations or some combination of the two are used to ascertain whether controls are present and functioning.

Findings are evaluated and deficiencies are communicated in a timely manner.
Examples of issues which would fall under this category are self-assessment by entities to determine whether internal controls are present and functioning.

This may include the establishment of independent internal audit functions within entities which would assist in identifying any gaps in controls.

The monitoring activities of Ministries and Departments was assessed and categorized as effective, generally effective and ineffective in the graph below.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 62 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Figure 6.5: Categories of monitoring activities Monitoring Activities (MA) EFFECTIVE 10 10 GENERALLY EFFECTIVE 18 16 14 12 10 8 6 4 2 0 17 Effective Generally Effective Ineffective INEFFECTIVE • Office of the Prime Minister, Office of the Attorney General, Ministry of Economy, Ministry of Defence and National Security, Ministry of Foreign Affairs, Parliament, Office of the Director of Public Prosecutions, Ministry of Disaster Management and Meteorological Services, Ministry of Justice, Fiji Corrections Service, Ministry of Communication, Ministry of Civil Service, Ministry of Rural and Maritime Development, Ministry of Youth and Sports, Ministry of Lands and Mineral Resources, Ministry of Industry, Trade and Tourism and Ministry of Sugar.
• Ministry iTaukei Productivity Affairs, Ministry and of of Employment, Industrial Relations, Information, Technology & Computing Services, Republic of Fiji Military Forces, Fiji Police Force, Peacekeeping Missions, Ministry of Women, Children and Poverty Alleviation, Ministry of Fisheries, Ministry of Forests and Ministry of Public Enterprise.
• Office of the President, Judiciary, Ministry of Education, Heritage and Arts, Ministry of Health and Medical Services, Department of Housing, Local Ministry of Agriculture, Ministry Government of Infrastructure and Environment, Ministry of Transport and Ministry of Waterways.

Housing, Ministry and of Of the 37 Ministries and Departments reported, the monitoring activities for 27 or 73% of agencies were effective or generally effective.
Ten Ministries and Departments require improvement in the on-going evaluations, separate evaluations to ascertain whether controls are present and functioning.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 63 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 7.0 SIGNIFICANT AUDIT MATTERS Significant audit matters highlighted in this report, include control weaknesses, which could cause or is causing severe disruption to the process or the ability of the agencies to achieve process objectives and comply with relevant legislations.
In this chapter, we discuss significant audit matters in the 2018 Financial Statements of Government.

The significant audit matters in Ministries and Departments is reported in the other Sector Reports.
7.1 Key Findings Other significant matters identified during the audit were communicated to the Ministry of Economy through our Management Letters and they relate to the following areas: • Annual Report on Whole of Government: the Ministry of Economy has not tabled in Parliament the Whole of Government annual report for the financial years ended 31 July 2016 and 2017.

The Ministry of Economy stated that it has taken note of the comments and the audit recommendations made.
• Ageing Reports not Maintained for VAT & Income Tax Refunds Outstanding: that FRCS did not maintain the ageing reports for Income Tax and VAT refunds outstanding as at 31 July 2018.

This limits the ability of Government to keep track of long outstanding dues.

The Ministry of Economy has indicated that it will liaise with the FRCS on maintaining and submitting ageing reports for VAT and income tax refunds outstanding.
• Implementation of Activities proposed in the Pacific Financial Technical Assistance (PFTAC) Report: technical assistance was provided by PFTAC to develop of a framework for identifying, assessing, and reporting of fiscal risks arising from public enterprises (PEs) and statutory authorities (SAs).

The technical assistance also looked at institutional arrangements to strengthen fiscal oversight of these entities activities.
Not all activities/recommendations in the PFTAC Report have been implemented by the Ministry.

The Ministry of Economy stated that it has taken note of the comments and the audit recommendations made.

In addition, the Ministry has recently completed a Public Expenditure and Financial Accountability Assessment and is working on a Public Financial Management Improvement Plan which will include reform actions to strengthen fiscal management.
• Delay in finalization of the Financial Statements of Government and Ministry of Economy: the finalization of the 2018 financial statements of Government and the Ministry of Economy were significantly delayed due to the numerous amendment to the draft accounts submitted for audit.
The Ministry of Economy stated that it has taken note of the comments and the audit recommendations made and has been advising Ministries and Departments via the Closing of Accounts Circulars and through the monthly Permanent Secretaries dashboard.

• Main Trust Fund Account: certain Trust Fund Accounts do not operate as a trust and should be included in the budgetary process.
When public money that fund operating and capital Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 64 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI expenditures of government are held in trust, the utilization of these funds do not go through the budget approval process.

Detailed listings were not maintained for monies held in trust totalled $78.3 million.
While the Office of the Auditor General had highlighted these matters directly with the agencies through the audit of agency financial statements, the Ministry of Economy has indicated that it will embark on a comprehensive review of all trust fund accounts to determine eligible trust accounts.
• Reconciliations not prepared for Main Trust Fund Account: there were significant delays in the preparation and submission to the Ministry of Economy of the accounts reconciliation statements for the Judiciary Trust which dates back to 2015.

The Ministry has put in measures to progress with the reconciliation.
• Significant Outstanding Operating Trust Fund Balance: the Operating Trust Fund account had a credit balance of $36.4 million as at 31 July 2018 the accumulation of which also increased the liabilities of Government.

The Ministry of Economy through its Monitoring and Evaluation Unit is reviewing these trust fund accounts and aliasing with respective Ministries/Departments on the need to continue the operation of these trust fund accounts.
• Debt Unit Internal Control Assessment: control environment weaknesses need to be improved in the Debt Management Unit.

The Debt Unit Standard Operating Procedures was still in draft form from 2014.

In addition, the Ministry did not have a Debt Management Strategy in 2018.
The Ministry of Economy stated that formulation of a Medium Term Strategy is earmarked for completion by the end of 2020/2021 financial year which will be undertaken with the technical assistance from multilateral development partners.

In relation to the Standards Operating Procedure (SOP), a comprehensive and updated SOP will also be formulated and finalized by the end of the 2020/2021 financial year.
• Accounting for Green Bond: the apportioning method used in allocating funds to relevant projects has not been appropriately approved or documented.

Details of the key findings with management comments are discussed Part C of this report.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 65 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI APPENDIX A: AUDIT OPINION RESULTS The following Tables present the results of our audit of the 2017-2018 financial statements for Ministries and Departments.

Consistent with presentation in this report, the results have been summarized by sectors.

The legislated timeframe for issuing of audit opinion for 2018 was 31 December 2018.
General Administration Ministry/Department Date audit report signed Audit Opinion Type 1.

Office of the President 15 March 2019 2.

Office of the Prime Minister and Department of Immigration 3.

Office of the Attorney General 4.

Ministry of Economy 5.

Ministry of iTaukei Affairs 6.

Ministry of Defence and National Security 7.


Ministry of Employment, Productivity and Industrial Relations 8 July 2019 29 March 2019 30 November 2020 17 May 2019 29 July 2019 Unmodified with Emphasis of Matter and Other Matter Modified Unmodified Unmodified with Emphasis of Matter Unmodified Unmodified 18 July 2019 Modified 8.

Ministry of Foreign Affairs 2 October 2019 9.

Judiciary 10.

Parliament 11.

Office of the Director of Public Prosecutions 12.


Ministry of Disaster Management and Meteorological Services 13.

Ministry of Justice 14.

Fiji Corrections Service 12 July 2019 6 February 2019 18 March 2019 16 November 2019 24 June 2019 21 October 2019 15.

Department of Information and 20 June 2019 Unmodified with Other Matters Modified Unmodified Unmodified Unmodified with Emphasis of Matter and Other Matter Unmodified Unmodified with Other Matter Unmodified Communication 16.
Department of Information, Technology and Computing Services (ITC) 17.

Ministry of Civil Service 18.

Ministry of Rural and Maritime Development 19.

Republic of Fiji Military Forces 20.

Fiji Police Force 21.

Peacekeeping Missions Social Services 17 October 2019 Unmodified 2 August 2019 9 April 2019 Unmodified Modified 2 October 2019 22 May 2019 31 October 2019 Unmodified Modified Unmodified with Emphasis of Matter Ministry/Department Date audit report signed Audit Opinion Type 22.
Ministry of Education, Heritage and 1 June 2020 Modified Arts and Higher Education Institutions Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 66 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Ministry/Department Date audit report signed Audit Opinion Type 23.

Ministry of Health and Medical 5 June 2020 Modified Services 24.

Department of Housing 13 August 2020 25.


Ministry of Women, Children and 31 October 2019 Poverty Alleviation Unmodified with Emphasis of Matter and Other Matter Modified 26.

Ministry of Youth and Sports 3 June 2019 Unmodified Economic Services Ministry/Department Date audit report signed Audit Opinion Type 27.

Ministry of Agriculture 24 May 2019 28.

Ministry of Fisheries 29 Ministry of Forestry 30.


Ministry of Lands and Mineral Resources 27 April 2020 6 February 2020 20 December 2019 Unmodified with Other Matter Modified Modified Modified 31.

Ministry of Industry, Trade and 20 June 2019 Unmodified Tourism 32.

Ministry of Sugar 33.

Ministry of Public Enterprise 22 May 2019 3 July 2020 34.

Ministry of Local Government and 20 April 2020 Housing 35.
Ministry of Environment 25 March 2020 Unmodified Unmodified with Other Matter Unmodified with Other Matter Modified Infrastructure Services Ministry/Department Date audit report signed Audit Opinion Type 36.

Ministry of Infrastructure and 30 October 2019 Modified Transport 37.
Ministry of Waterways 13 June 2019 Unmodified Emphasis of Matter Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 67 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI APPENDIX B: ANALYSIS OF FINANCIAL STATEMENTS OF GOVERNMENT Cash and Cash Equivalents A bank account for public money, other money or trust money must only be established with the approval of the Chief Accountant, who must inform the bank of the agency officers authorised to operate on it.
All agency bank accounts must be kept in the name of the agency or the official title of a unit within the agency.

The cash and cash equivalents balance decreased from $289.8 million in 2017 to $286.7 million in 2018.

Major decreases were noted in Trust Fund Account and Domestic Fund Account bank balances by 5% and 10%, respectively.

Overseas cash increased by 5% while unpresented cheque decreased by 26%.

The table below shows changes in net cash.


A bank account for public money, other money or trust money must only be established with the approval of the Chief Accountant, who must inform the bank of the agency officers authorised to operate on it.
All agency bank accounts must be kept in the name of the agency or the official title of a unit within the agency.10 Account Overseas Agencies Domestic Account Trust Fund Account Trading & Manufacturing Account (TMA) Unpresented Cheques Net Cash Change % Change 2018 Balances ($) 19,537,799 2017 Balances ($) 18,546,563 153,419,625 169,913,602 161,050199 169,295,442 13,944,586 13,630,893 ($) 991,236 (16,493,977) (8,245,243) (313,693) (60,984,785) (81,947,052) 286,653,731 289,753,141 20,962,267 (3,099,410) 5 (10) (5) (2) 26 (1) A graphical presentation of the account balances for the past five years is provided below.
s n o i l l i M 250 200 150 100 50 - (50) (100) Overseas Agencies Domestic Account Trust Fund Account TMA Bank 2014 2015 2016 2017 2018 10 Finance Instructions 2010 – Section 32(1) & (4) Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 68 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Cash balances in Domestic and Trust Fund Accounts made up majority of the government’s cash holdings at year end.
Borrowing Fund Account The government also receives short term advances from the Reserve Bank of Fiji (RBF) referred to as Ways and Means.

These advances are raised to meet any immediate cash needs of government.

During the year, Government utilised $26.8 million of this facility through the RBF.

Borrowings over the 15 Year Period Government borrowed a total of $875.0 million in 2018 which increased by $186.1 million or 27% from a total of $688.9 million borrowed in 2017.
Of the total borrowing in 2018, 8% or $74.2 million was borrowed from Overseas, 31% or $269 million were from Treasury Bills and 61% or $531.8 million was borrowed through domestic bonds.

Tabulated below are the total amounts borrowed by government from 2004 to 2018.
Year Domestic Bonds Amount $’000 449,218.2 319,967.0 356,778.6 100,536.3 341,266.9 404,239.8 452,734.1 81,470.5 192,102.0 172,822.0 233,405.8 257,356.1 295,167.0 224,223.0 531,796.0 % Change 54 (29) 12 (72) 239 18 12 (82) 136 (10) 35 10 15 (24) 137 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 * 7 months Overseas Borrowings Amount $’000 9,267.7 8,641.3 283,258.7 19,855.8 20,802.8 25,476.8 61,949.5 569,043.1 136,428.7 99,466.3 120,241.3 478,804.8 80,667.6 223,042.4 74,178.4 % Change (68) (7) 3,178 (93) 5 22 143 819 (76) (27) 21 298 (83) 176 (67) Treasury Bills Total Amount $’000 189,256.7 326,951.1 528,715.4 685,889.2 391,725.9 253,821.7 687,313.1 411,970.9 306,664.5 138,122.1 306,883.4 332,840.6 211,787.7 241,600 269,000 % Change (67) 73 62 30 (43) (35) 171 (40) (26) (55) 122 8 (36) 14 11 Amount $’000 647,742.6 655,559.4 1,168,752.7 806,281.3 753,795.6 683,538.3 1,201,996.7 1,062,484.5 635,195.2 410,410.4 660,530.5 1,069,001.6 587,622.3 688,865.4 874,974.4 % Change (28) 1 78 (31) (7) (9) 76 (12) (40) (35) 61 62 (45) 17 27 Overseas borrowing decreased by 67% in 2018 from a total of $223 million borrowed in 2017 while treasury bills raised in 2018 increased by 11% from $241.6 million raised in 2017.
Domestic borrowings increased by 137% from $224.2 million in 2017.

Trends in Government Borrowing by Category The total public debt at the end of each year from 2004 to 2018 and its composition for the last 15 years are summarised in the table below.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 69 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Year Domestic Bond 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 Amount $’000 1,986,515.7 2,121,422.7 2,300,672.6 2,196,208.2 2,346,258.2 2,505,092.1 2,759,292.1 2,627,382.1 2,631,565.6 2,641,564.5 2,698,317.5 2,836,488.6 3,079,850.6 3,204,762.3 3,576,152.2 * 7 months Percentage of Total Borrowing (%) 87 88 80 80 81 80 82 74 72 69 66 67 68 69 69 Treasury Bills Amount $’000 126,987.8 136,018.4 141,311.7 141,160.4 64,553.0 97,721.3 74,969.8 70,921.4 111,733.0 102,278.1 130,600.0 143,255.9 163,844.8 94,884.3 185,283.2 Percentage of Total Borrowing (%) 6 6 5 5 2 3 2 2 3 3 3 3 4 2 4 Overseas Loan Amount $’000 168,665.4 164,050.9 416,729.2 397,103.4 475,994.4 527,248.5 548,461.8 832,147.8 935,530.6 1,081,097.4 1,254,277.3 1,241,407.4 1,258,728.4 1,367,960.9 1,455,292.8 Percentage of Total Borrowing (%) 7 7 15 15 16 17 16 24 25 28 31 29 28 29 28 Total Amount $’000 2,282,168.9 2,421,492.0 2,858,713.5 2,734,472.0 2,886,805.6 3,130,061.9 3,382,723.7 3,530,451.3 3,678,829.2 3,824,940.0 4,083,194.8 4,221,151.9 4,502,423.8 4,667,607.5 5,216,728.2 Government bonds mature between 3 to 15 years.
In contrast, the term of Treasury Bills which constitute 3% of the borrowings ranges between 14 to 245 days.

Over the last 15 years, the percentage of overseas borrowings constituted an average 21% of the borrowings.

A graphical representation of the outstanding government borrowings position is provided below.
m ) $ ( t n u o m A 6,000 5,000 4,000 3,000 2,000 1,000 00 Years Treasury Bills Overseas Loans Domestic Loans Total Borrowings Public debt has been steadily increasing over the years and in 2018, a further increase of $549 million or 12% was noted when compared to the debt of $4.7 billion owed in 2017.

The rise in the national debt level was due to increases in domestic debt by $371.4 million, overseas debt by $87.3 million and an increase in treasury bills by $90.4 million.
The figure below shows the relationship between actual revenues and expenditures over the last 15 years.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 70 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI s n o i l l i M ) $ ( t n u o m A 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Years Revenue Expenditure *Year 2016 was for 7 months The figure above indicated that government expenditure of $3.8 billion exceeded revenue of $3.3 billion in 2018 resulting in a gross deficit of $492 million for the year. )
m $ ( t n u o m A 200 0 -200 -400 -600 -800 -1000 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Years Surplus/(Deficit) *Year 2016 was for 7 months Loan Repayments There is an annual obligation for the Government to redeem the borrowings which become due for payment.

The terms and conditions of the borrowings are stipulated in the Loan Agreements between the Government and the lending agencies.
The repayments of the borrowings of the Government over the past 15 years is represented in the table below.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 71 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Year Domestic Bonds Principal Interest Overseas Borrowings Interest Principal Treasury Bills Principal Interest Amount $’000 Amount $’000 Amount $’000 Amount $’000 Amount $’000 Amount $’000 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* * 7 months 4,310.4 2,392.8 5,746.3 10,514.0 566.6 1,971.7 4,296.0 2,081.2 850.8 967.6 922.0 2,831.8 2,417.9 1,883.4 1,799.4 Total Repayment & Interest Amount $’000 614,793.4 643,786.8 855,321.8 1,088,897.8 840,754.9 678,939.0 1,159,390.1 1,178,947.4 776,045.3 587,348.0 746,927.6 1,286,113.3 432,538.2 665,458.1 673,007.5 Principal repayments for domestic bonds increased by $61 million or 61%, principal repayments for overseas borrowings decreased by $4.5 million or 9% and principal repayments for treasury bills decreased by $63.6 million or 27%.
Overall the total principal debt repayments decreased by $7 million or 2% in 2018.

Principal payments in 2018 for government borrowings totalled $381.6 million whilst interest payments amounted to $291.4 million.

Refer to the table below for details.


Description Domestic Bonds Overseas Borrowings Treasury Bills Total Principal Repayment Amount $’000 160,729.0 44,811.3 176,100.6 381,640.9 Interest Repayment Amount $’000 240,702.8 48,864.4 1,799.4 291,366.6 The Weighted Average interest rate on domestic borrowings is around 7% compared to 4% for overseas borrowings.

Interest rate for domestic debt ranges from 1% to 14% and external ranges from 1% to 7%.
Domestic Bonds The total domestic bonds as at 31 July 2018 was $3.6 billion which made up 69% of total Government borrowings.

The table below shows the amounts that are owed by the Government to bond holders.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 72 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Bond Holder Amount FNPF Insurance Companies Commercial Banks RBF Trust Fund (excluding UTOF) Unit Trust of Fiji Others Total Add Accrued interest Add Unamortized premium Total Amount $’000 2,604,776.5 650,293.0 121,145.0 75,742.0 28,442.0 25,667.0 69,422.0 3,575,487.5 648.9 15.8 3,576,152.2 Percentage of Outstanding Debt (%) 73 18 3 2 1 1 2 The Fiji National Provident Fund (FNPF) held 73% of the bonds as at 31 July 2018 followed by Insurance Companies at 18%.
The composition of outstanding government bonds is shown below.

Trust Fund (excluding UTOF) 1% RBF 2% Unit Trust of Fiji 1% Others 2% Commercial banks 3% Insurance Companies 18% Green Bond FNPF 73% Government offered its first Green Bond in October 2017 and became the first emerging economy to offer a sovereign green bond.

Worth at $100 million, the Fiji Sovereign Green Bond were offered in four tranches.
Month November 2017 December 2017 June 2018 July 2018 Tranche 1st tranche 2nd tranche 3rd tranche 4th tranche Proceeds $40 million $20 million $26.6 million $13.4 million Proceeds from the issue of Fiji’s Green Bond were used to fund identified eligible projects that have been approved in the budget.
These projects fall under either of the following sectors in accordance with the Fiji Green Bond Framework: Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 73 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 1.

Renewable Energy and Energy Efficiency; 2.

Resilience to Climate Change for Highly Vulnerable Ares and Sectors; 3.

Clan and Resilient Transport; 4.

Reducing Pollution and Greenhouse Gas Emission; 5.

Water Efficiency and Wastewater Management; 6.


Sustainable Management of Natural Resources; and 7.

Eco-efficiency.

Seven projects were identified by the Climate Change and International Cooperation Unit (CCIC) and were funded through proceeds from the Green Bond.
These projects were budgeted for under various Ministries and Departments which included Water Authority of Fiji ($10,069,259), Allocation under Head 50 ($45,906,073), Fiji Roads Authority ($34,583,500), Department of Energy ($6,280,998), Ministry of Forestry ($308,542) and the Ministry of Local Government, Housing and Environment ($2,851,628) Borrowings & Interest Payments Details of outstanding borrowings over the past 15 years with the total interest paid and its budgetary provision is shown in the table below.
Interest are paid every six months.
Year Domestic Borrowings ($m) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 * 7 months 1,986.5 2,121.4 2,300.7 2,196.2 2,346.3 2,505.1 2,759.3 2,627.4 2,631.6 2,641.6 2,698.3 2,836.5 3,079.9 3,204.8 3,576.1 % Increase /(Decrease) 18 7 8 (5) 7 7 10 (5) 0.2 0.4 2 5 9 4 12 Interest Paid ($m) 108.6 120.2 129.5 148.0 147.4 165.3 190.7 213.2 210.5 207.5 209.4 210.3 125.1 229.3 240.7 % Increase/ (Decrease) 6 11 8 14 (0.4) 12 15 12 (1) (1) 1 0.4 (41) 83 5 Budgetary Provision ($m) % Change 121.5 124.0 127.7 148.2 151.4 156.7 190.6 225.4 211.7 208.3 209.5 210.5 219.3 232.5 243.5 10 2 3 16 2 4 22 18 (6) (2) 1 1 (4) 6 5 Total domestic borrowings outstanding increased by $371.3 million or 12% in 2018 compared to 2017.
Interest paid on domestic borrowings increased by $11.4 million or 5%.

The Government had allocated $243.5 million in the 2018 budget for interest payments of which $240.7 million was paid during the year.

The interest expense and the principal repayments over the past 15 years are shown in the figure below.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 74 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI ) m $ ( t n u o m A 300 250 200 150 100 50 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Year Principal Interest Overseas Borrowings The total outstanding overseas borrowing of Government as at 31 July 2018 was $1.5 billion which represents 28% of the total outstanding borrowings.
Majority of the overseas borrowings obtained were to finance capital projects.

Yearly Overseas Borrowings The figure below shows the trend of the yearly cash overseas borrowings over the past 15 years.
s n o i l l i M ) $ ( 600 500 400 300 200 100 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 *Year 2016 was for 7 months Year There were marked increases in overseas borrowing in 2006, 2011 and 2015 as a result of the issuance of the US$150 million, US$250 million and US$200 million global bonds.

In 2018, borrowing declined due to significant decrease in cash borrowings compared to 2017.
Government borrowed a total of $74.1 million from overseas which consisted of cash disbursements of $68.2 million and direct disbursements of $5.9 million.

Overseas loan repayments Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 75 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI totalling $93.7 million were made in 2018, which comprises $48.9 million in interest and $44.1 million in principal repayment.
Refer to the table below for details of overseas borrowings made in 2018.
Loan Cash ($) Capitalisation of Interest ($) Direct Disbursement ($) Front End Fee ($) Loan Amortisation ($) Total ($) Road Upgrading Projects ADB Transport Sector Infrastructure Project World Bank Transport Infrastructure Investment Project Water Project Urban Water Supply & Wastewater Management Program Telecommunication Project Pacific Regional Connectivity Project: Fiji Connectivity Project Sustainability Project Fiscal Sustainability Climate Resilience Development Sustained Private Sector- LED Growth Reform Program Global Bond 2015 Global Bond Borrowing Total --- --- 448,890 4,496,159 396,944 550,050 --- --- --- --- 4,945,049 946,994 --- 97,275 908,798 --- --- 1,006,073 5,595,856 31,061,864 31,565,657 --- --- --- --- --- --- --- --- 5,595,856 --- --- 77,592 --- 31,139,456 --- --- 31,565,657 --- --- 850,649 850,649 68,223,377 943,109 5,955,007 77,592 850,649 76,049,734 Borrowings in relation to the Sustainability Project comprised of 82% or $62.7 million of the total overseas borrowings by Government.
The funds obtained for this project were utilised in the following: • • • • Development of a new framework to guide the strengthening of fiscal oversight on State owned enterprises; Development of a framework governing international commercial arbitration; Development of a framework for issuing building permits to expedite the process of obtaining building permits for non-residential supposedly by businesses and individuals; Strengthening fiscal management, policy, legal and institutional framework for State owned enterprises and public private partnerships and business and investment climate.
The composition of the Overseas Borrowings is illustrated below.

Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 76 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Road Upgrading Projects 8% Global Bond 1% Sustainability Project 82% Overseas Borrowings Outstanding & Interest Paid Water Project 1% Telecommunication Project 8% The table below provides the details of overseas borrowings outstanding over the past 15 years with the total interest paid each year.
Year Overseas Borrowings ($m) % Increase/ (Decrease) Interest Paid ($m) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 * 7 months 168.7 164.1 416.7 397.1 476.0 527.2 548.5 832.1 935.5 1,081.0 1,254.3 1,241.4 1,258.7 1,367.9 1,455.3 (3) (3) 154 (5) 20 11 4 52 12 16 16 (1) 1 9 6 6.1 5.5 5.7 22.2 20.8 24.4 22.9 43.1 46.3 51.9 53.8 77.4 22.6 45.5 48.9 % Increase/ (Decrease) (15) (10) 4 289 (6) 17 (6) 88 7 12 4 44 (71) 94 7 Budgetary Provision ($m) Variance ($m) In 2018, the outstanding overseas borrowings increased by 6% compared to 2017.
A sum of $54.5 million was provided in the 2018 Budget Estimates (revised) for interest expense of which $48.9 million was actual interest payment made.

The principal and interest payments are illustrated in the figure below.

Principal repayment for overseas loans in 2018 amounted to $44.8 million while interest payment totalled $48.9 million.

This was a decrease of $1.2 million or 1.3% compared to 2017.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 77 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Revaluation of Overseas Borrowings Principal Repayments Interest 600.00 500.00 400.00 300.00 200.00 100.00 0.00 ) m $ ( t n u o m A 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Year 2016 (7 months) 2017 2018 Overseas borrowings are revalued at year end using the Reserve Bank Fiji (RBF exchange rate as at 31/07/18) which had an effect on the public debt balance at year end.
Revaluation may result in increase or decrease in the public debt balance based on the exchange rate prevailing at the end of the year.

The table below outlines the amounts attributed to overseas borrowings due to revaluation over a 15-year period.

Overseas borrowings are revalued at year end using the Reserve Bank Fiji (RBF exchange rate as at 31/07/18) which has an effect on public debt balance outstanding at year end.
Revaluation may result in increase or decrease in the public debt balance based on the exchange rate prevailing at the end of the year.

The table below outlines the amounts attributed to overseas borrowings due to revaluation over a 15-year period.
Year Revaluation Increase/ (Decrease) Amount ($’000) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 * 7 months (3,554.5) (534.3) (17,120.5) (21,844.9) 70,352.3 46,988.9 22,885.6 1,537.3 14,895.7 65,295.3 65,340.8 70,666.2 (24,319.2) (54,259.2) 56,093.5 Overseas Borrowings Due Amount $’000 168,665.4 164,050.9 416,729.2 397,103.4 475,994.4 527,248.5 548,461.8 832,147.1 935,530.6 1,081,097.4 1,254,277.3 1,241,407.4 1,258,728.4 1,367,960.9 1,455,292.8 Unrealised Exchange (Gain)/Loss as a % of Overseas Borrowings (2) (0.3) (4) (6) 15 9 4 0.2 2 6 5 6 (2) (4) 4 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 78 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI The value of the overseas borrowings increased by $56.1 million or 4 % due to fluctuations in the exchange rates11 in 2018.
Treasury Bills The Government through the Reserve Bank of Fiji floats Treasury bills to raise funds in the domestic market to meet its short-term needs.

Treasury bills are sold at a discount on face value.

The investor will receive face value upon maturity.

During the year, the government raised $269 million in Treasury bills of which $266.5 million constituted net borrowings whilst $2.5 million represented discounts as summarised in the table below.
Bank Commercial Banks Others Total Face Value Amount $’000 258,240.0 10,760.0 269,000.0 % of Total 96 4 100 Discount Amount $’000 2,284.7 215.8 2,500.5 % of Total 91 9 100 Net Receipts Amount $’000 255,955.3 10,544.2 266,499.5 % of Total 96 4 100 Of the total Treasury bills issued in 2018, 96% were purchased by commercial banks and the remaining 4% by other entities and individuals.

This composition is shown in the graph below.


The table below details the total Treasury bills raised during the year together with their maturity dates and discount.
Maturity in Days Face Value Amount $’000 Discount Amount $’000 Treasury Bill Amount $’000 14 28 56 91 182 245 Total 9,000.0 33,000.0 35,000.0 54,000.0 110,500.0 27,500.0 269,000.0 1.4 24.4 59.1 185.5 1,643.4 586.6 2,500.5 8,998.6 32,975.6 34,940.9 53,814.5 108,856.6 26,913.4 266,499.5 11 In a floating rate system, the exchange rate is determined directly by market forces, and is liable to fluctuate continually.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 79 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Refer to the figures below for these details: Discount and Maturity of Treasury Bills 2000000 1500000 1000000 500000 ) $ ( t n u o m A 0 245 Days 11% Discount 14 56 182 Maturity in Days 182 Days 41% Treasury Bills Over a 15-year Period Percentage of Treasury Bills Face Value 14 Days 3% 28 Days 12% 56 Days 13% 91 Days 20% Treasury bills issued and redeemed over the last 15 years is summarised in the table below.
Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 * 7 months Balance Brought Forward Amount $’000 276,925.8 126,987.8 136,018.4 141,311.7 141,160.5 64,553.0 97,721.3 74,969.8 70,921.4 111,733.0 102,278.1 128,583.5 143,255.9 163,844.8 94,884.3 Issues Redemption Outstanding Amount $’000 189,256.7 326,951.1 528,715.4 685,889.2 391,725.9 253,821.6 687,313.1 411,970.9 306,664.5 138,122.1 306,883.4 336,000.0 213,200.0 241,600.0 269,000.0 Amount $’000 339,194.7 317,920.6 523,422.1 686,040.5 468,333.4 220,653.3 710,064.6 416,019.3 265,853.0 147,577.0 280,578.0 321,327.6 192,611.1 310,560.513 178,601.1 Amount $’000 126,987.8 136,018.3 141,311.7 141,160.4 64,553.0 97,721.3 74,969.8 70,921.4 111,732.9 102,278.1 128,583.512 143,255.9 163,844.8 94,884.3 185,283.2 Treasury bills raised by Government over the last 15 years have fluctuated significantly.
Similarly, the Government deficits/surplus have also fluctuated.

The trend for Treasury bills issued, redemptions, bills outstanding at the end of the financial year and the yearly deficit/surplus are shown in the figure below.
12 Excludes discount of $2,016,548.07 13 Excludes unamortised interest of $1,883,410 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 80 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 800,000,000 600,000,000 400,000,000 200,000,000 ) $ ( t n u o m A 0 (200,000,000) (400,000,000) (600,000,000) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Year Issues Redemption Outstanding Budget Deficit In 2018 a budgeted gross deficit of $716.9 million was recorded, with treasury bills outstanding totalling $185.3 million.
Treasury Bills Management Treasury bills are short-term financial instruments used by Ministry of Economy to cover shortfalls during the year.
The analysis of budgeted revenue and expenditure as provided for in the Budget and the Treasury Bills raised for the year are as follows: Revenue 2009 ($m) 2010 ($m) 2011 ($m) 2012 ($m) 2013 ($m) 2014 ($m) 2015 ($m) 2016 (7 months ($m) 2017 ($m) 2018 ($m) Budgeted Revenue Operating Receipts & 1,522.40 1,496.50 1,745.70 1,942.80 2,108.40 2,721.80 3,122.40 3,128.7 3,175.3 3,857.3 Investing Loan Receipts Total Actual Revenue 522.50 2,044.90 497.50 1,994.00 734.50 2,480.20 338.40 2,281.20 398.90 2,507.30 385.40 3,107.20 891.90 4,014.30 445.4 3,574.1* 620.6 716.9 3,795.9 4,574.2 Operating Receipts & 1,412.80 1,536.50 1,801.30 1,937.10 2,098.40 2,371.0 2,943.5 1,500.8 2,859.1 3,258.3 Investing Loan Receipts Total Revenue Variance Treasury Bills raised Excess/((shortfall) 405.40 1,818.20 (226.70) 253.82 27.12 463.00 1,999.50 5.50 687.31 692.81 693.40 2,494.70 14.50 411.97 426.47 192.20 2,129.30 (151.90) 306.66 154.76 173.10 2,271.50 (235.80) 138.12 (97.68) 353.60 2,724.60 (382.60) 306.88 (75.72) 801.8 3,745.3 (269.00) 336.00 67 305.5 1,806.3 (1,767.8) 213.2 (1,554.6) 447.3 606.0 3,306.4 3,864.3 (489.5) (709.9) 241.6 269.0 (247.9) (440.9) The operating and investment receipts should pay for operational costs of Government which include SEGs 1 – 7, 11 & 12 and capital development programs.
Treasury bills are raised to cover operational deficits provided that they are no more than the estimated operating and investing receipts to be collected during the year.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 81 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Government revenue and borrowings from domestic and overseas markets were not sufficient to meet the actual expenditure, hence a total of $269.0 million were raised through Treasury bills in 2018.

Ways and Means Ways and Means is a short-term advance facility provided by the RBF for Government for a day to meet immediate cash deficits.
Ways and Means are replenished by Government during the year and are therefore not reflected as part of borrowings.

An analysis of Ways and Means balances for the past 15 years is illustrated in the figure below.

400 350 300 250 200 150 100 50 0 ) m $ ( t n u o m A 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Year Government utilised $26.8 million from this facility in 2018 compared to $107.5 million in 2017.
Financial Flexibility Financial flexibility is an indicator of the degree a Government can increase its financial resources or revenue to respond to increasing financial commitments either by expanding the revenue or increasing its debt burden.

The table below contains data for total revenue and debt repayments of Government for a period of 15 years.

The revenue of Government include a significant portion derived from borrowings.

The flexibility analysis includes revenue data and loan components.
Year Revenue Amount $’000 Debt Repayments Amount $’000 Interest Bite % Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 82 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Year Revenue Amount $’000 Debt Repayments Amount $’000 Interest Bite % 2012 2,129,335.0 2013 2,119,975.2 2014 2,393,392.5 2015 2,793,515.3 2016* 1,500,808.2 2017 2,837,441.7 2018 3,244,439.6 * 7 months 775,194.5 576,915.5 746,927.6 1,286,113.3 432,538.2 663,730.6 673,143.9 36 27 31 46 29 23 21 Debt repayment comprises the principal and interest components of the domestic and overseas borrowings as well as the Treasury Bills redemption.
The Interest Bite represents the percentage of Debt Repayments to Total Revenue.

80% 70% 60% 50% 40% 30% 20% 10% 0% e g a t n e c r e P Interest Bite 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years In 2018, the financial flexibility measure was 21% indicating that the total debt repayment was equivalent to 21% of the revenue received by the Government during the year compared to 23% in 2017.
Hence, 79% of revenues collected were available for government programs compared to 77% in 2017.

Financial Vulnerability Financial Vulnerability is the measure of the degree of dependence of Government on sources of borrowing outside its control or influence.

A measure of vulnerability is the comparison of Overseas Borrowings to the total Government debt.

The table below compares Overseas Borrowings to total Government Debt for a period of 15 years.
Year 2004 2005 2006 Outstanding Overseas Borrowings Amount $’000 168,665.4 164,050.9 416,729.2 Government Debt % Amount $’000 2,282,168.9 2,421,492.0 2,858,713.5 7 7 15 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 83 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 * 7 months Outstanding Overseas Borrowings Amount $’000 397,103.4 475,994.4 527,248.5 548,461.8 832,147.1 935,530.6 1,081,097.4 1,254,277.3 1,241,407.4 1,258,728.4 1,367,960.9 1,455,292.8 Government Debt % Amount $’000 2,734,472.0 2,886,805.6 3,130,061.9 3,382,723.7 3,530,451.3 3,678,829.2 3,824,940.0 4,083,194.8 4,221,151.9 4,502,423.8 4,667,607.5 5,216,728.2 15 16 17 16 24 25 28 31 29 28 29 28 In 2018, overseas borrowings made up 28% of outstanding government borrowings which decreased by 1% when compared to 2017. e g a t n e c r e P 35% 30% 25% 20% 15% 10% 5% 0% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years The overall trend indicates an increasing reliance by Government on overseas borrowings from 2006.
There were sharp increases in 2006, 2011 and 2014 followed by a decreased reliance in 2016, an increase in 2017 and slight decrease in 2018.

Another measure of Financial Vulnerability is the comparison of overseas borrowings to Gross Domestic Product (GDP).

The table below compares overseas borrowings to GDP over a period of 10 years.
Year Overseas Borrowings Amount $’000 527,248.5 2009 548,461.8 2010 832,147.1 2011 935,530.6 2012 1,081,097.4 2013 1,254,277.3 2014 2015 1,241,407.4 2016* 1,258,728.4 Nominal GDP Amount $’000 % of Overseas Borrowings/GDP 5,614,100.0 6,024,400.0 6,768,500.0 7,109,500.0[r] 7,715,700.0[r] 8,435,900.0[r] 9,210,800.0[p] 9,852,704.1[p] 9 9 12 13 14 15 13 13 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 84 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Year 2017 2018 Overseas Borrowings Amount $’000 1,367,960.9 1,455,292.8 [r]: GDP Revised Figure [p]: GDP Provisional Figure [*]:* 7 months Source: Macroeconomic Committee Nominal GDP Amount $’000 % of Overseas Borrowings/GDP 9,865,489.8(p) 11,348,969.4[p] 14 13 e g a t n e c r e P 16% 14% 12% 10% 8% 6% 4% 2% 0% 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years Moreover, the comparison of the domestic debt to GDP is another measure of Financial Vulnerability.
The table below compares Domestic Borrowings to GDP for a period of 10 years.
Year 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 Domestic Borrowings Amount $’000 2,505,092.2 2,759,292.2 2,663,382.1 2,631,565.7 2,641,564.5 2,698,317.5 2,836,488.6 3,079,850.6 3,204,762.3 3,576,152.2 [r]: GDP Revised Figure [p]: GDP Provisional Figure [*]: 7 months Source: Macroeconomic Committee Nominal GDP Amount $’000 5,614,100.0 6,024,400.0 6,768,500.0 7,109,500.0[r] 7,715,700.0[r] 8,435,900.0[r] 9,210,800.014[p] 9,852,704.1 9,865,489.8(p) 11,348,969.4(p) % of Domestic Borrowings/GDP 45 46 39 37 34 32 31 31 32 32 Domestic borrowing as a percentage of GDP slightly increased to 32% in 2017 and remained stagnant at 32% in 2017 and 2018.
14 Excludes Treasury Bills outstanding at year end Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 85 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI ) % ( e g a t n e c r e P 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years The figure above shows that the Domestic Borrowing as a percentage of the GDP has been decreasing over the years and indicates the nation’s capability to meet its internal debt obligations when due.
The table below shows the comparison between Tax Revenue and the GDP.
Year 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 Tax Revenue Amount $’000 1,209,223.6 1,302,130.6 1,573,667.0 1,722,147.5 1,879,295.2 2,117,742.4 2,359,863.2 1,314,520.0 2,579,175.4 GDP Amount $’000 5,614,100.0 6,024,400.0 6,768,500.0 7,109,500.0[r] 7,715,700.0[r] 8,435,900.0[r] 9,210,800.0[p] 9,852,704.1 9,865,489.8(p) 2,831,635.8 11,348,969.4 % of Tax Revenue/GDP 22 22 23 24 24 25 26 13 26 25 [r]: GDP Revised Figure [p]: GDP Provisional Figure [*]: 7 months Source: Macroeconomic Committee The figure below shows that the Tax Revenue as a percentage of GDP in the last 10 years has been between 22% - 26%.
In 2018, this percentage decreased from 26% to 25%.

Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 86 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 30 25 20 15 10 5 ) % ( e g a t n e c r e P 0 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years Another measure of Financial Vulnerability is the comparison of tax revenue to debt.

The table below compares tax revenue to debt for a period of 10 years.
Year 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 [*]: 7 months Tax Revenue Amount $’000 1,209,223.6 1,302,130.6 1,573,667.0 1,722,147.5 1,879,295.2 2,117,742.4 2,359,863.2 1,314,520.0 2,579,175.4 2,831,635.8 Debt Amount $’000 3,130,061.9 3,382,723.7 3,530,451.3 3,678,829.2 3,824,940.0 4,083,194.8 4,221,151.9 4,502,423.8 4,667,607.5 5,216,728.2 % of Tax Revenue/Debt 39 38 45 47 49 52 56 29 55 54 The tax revenue as a percentage of debt decreased from 55% in 2017 to 54% in 2018.
This indicates that 54% of total government debt can be met from tax revenue in 2018.

60 50 40 30 20 10 ) % ( e g a t n e c r e P 0 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years The ability of tax revenue to meet the debt over the 10-year period was on a declining trend since 2008 and gradually increased from 2010 to 2015 due to increase in tax collections during these years.
However, a sharp decrease in 2016 was due to the change in accounting period from 12 months in 2015 to 7 months in 2016.

The revenue collected was only for 7 months.

There was a Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 87 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI sharp increase in 2017 as tax collections increased for the 12 months ended 31 July 2017.

In 2018 there was a slight decrease from 55% to 54%.
The table below shows the comparison of government surplus/ (deficit) to GDP.
Year 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 Gross Surplus/ (Deficit) Amount $’000 (93,167.4) 99,398.8 49,027.1 (136,880.6) (37,583.7) (554,256.8) (859,086.2) (347,125.0) (371,812.0) (492,092.8) GDP Amount $’000 5,614,100.0 6,024,400.0 6,768,500.0 7,109,500.0[r] 7,715,700.0[r] 8,435,900.0[r] 9,210,800.0[p] 9,852,704.1 9,865,489.8(p) 11,348,969.4 % of Gross Surplus (Deficit) /GDP (1.7) 1.6 0.7 (1.9) (0.5) (6.6) (9.3) (3.5) (3.8) (4.3) [r]: GDP Revised Figure [p]: GDP Provisional Figure [*]: 7 months Source: Macroeconomic Committee ) % ( e g a t n e c r e P 4 2 0 2009 -2 -4 -6 -8 -10 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years In 2018, the gross deficit as a percentage of GDP deteriorated to 4.3% when compared to 2017.
Year 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 Interest Payments Amount $’000 191,617.4 217,934.4 258,434.5 260,860.9 260,450.7 264,309.2 295,416.3 150,088.6 276,746.1 291,503.0 GDP Amount $’000 5,614,100.0 6,024,400.0 6,768,500.0 7,109,500.0[r] 7,715,700.0[r] 8,435,900.0[r] 9,210,800.0[p] 9,852,704.1 9,865,489.8(p) 11,348,969.4 % of Interest Payments /GDP 3 4 4 4 3 3 3 2 3 3 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 88 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI 4.5 4 3.5 3 2.5 2 1.5 1 0.5 ) % ( e g a t n e c r e P 0 2009 2010 2011 2012 2013 2014 2015 2016(7 months) 2017 2018 Years The ability of the country’s total income to meet the interest payments on public debt over the 10 year period, gradually increased from 2009 to 2010 to 4%.
From 2010 to 2012, it remained stagnant at 4% and later reduced to 3% in 2013.

Again from 2013 to 2015, it remained stagnant at 3%, until it further reduced to 2% in 2016.

This was due to the change in accounting period from 12 months in 2015 to 7 months in 2016.

From 2017 it increased to 3% and remained till 2018.
Year 2009 2010 2011 2012 2013 2014 2015 2016* 2017 2018 [*]: 7 months 18 16 14 12 10 8 6 4 2 ) % ( e g a t n e c r e P 0 2009 Interest Payments Amount $’000 Tax Revenue Amount $’000 % of Interest Payments /Tax Revenue 2016(7 months) 2017 2018 Years Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 89 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI The ability of tax revenue to meet interest payments on public debt over the 10-year period increased from 2009 to 2010 from 16% to 17% until 2011.
This further reduced in 2010 to 2014 by 5% from 17% to 12%.

From 2014 to 2015, it increased by 1% while from 2015 to 2018 it reduced from 13% to 10%.

For 2018, 10% of tax revenue was used to pay interest payment on public debt.

Principal Repayments for external loans commencing at end of Grace Period Principal repayments for the external loans below will commence at the end of their grace periods.
The loans were signed in 2014/2015 to 2016/2017 financial year with grace period ranging from 3 to 5 years from the signing date.

Aside from the Global bonds that is due in October 2020, the principal repayments for other external loans will commence in financial year 2019 and 2021 respectively.

Lenders Institutions by Financial Loan agreement signed Commencement of principal repayment No.
of years lapsed Loan balance 31/07/18 Amount $’000 Supply Asian Development Bank (ADB): Transport Infrastructure loan (Loan No.

3210) and Urban Water Wastewater Management Investment Program (Loan No.

3512) Emergency for Recovery from Tropical Cyclone Winston (Loan No.

3403) Sustained Private Sector-Led Growth Reform Program (Loan No.
3667) Assistance 12/12/2014 15/06/2020 16/10/2017 15/04/2023 18/07/2016 15/11/2021 24/06/2018 15/10/2021 International Fund for Agricultural Development (IFAD) loans: Fiji Agricultural Partnership Project (Loan No.

2000000602) 3/12/2015 2020 onwards 18/07/2016 14/04/2016 15/11/2022 Infrastructure (Loan No.

World Bank/International Bank for Reconstruction and Development: IBRD Post Cyclone Winston Emergency Development Policy Operation (Loan No.
8632) Transport Investment Project 8482) Fiji Connectivity Project (Loan No.

8666) IBRD Fiscal Sustainability and Climate Resilience Development Policy Loan (Loan No.

8840) European Investment Bank Fiji Water and & Wastewater Project Total 2022 onwards.
15/05/2021 18/04/2018 16/12/2016 15/01/2022 15/05/2023 10/11/2017 6 5 5 3 5 6 5 6 5 5 10,024.0 3,293.2 105,064.1 31,519.2 2,213.5 105,064.1 7,792.3 6,268.8 31,519.2 No drawdowns in FY 2017/2018 302,758.4 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 90 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Global Bond Refinancing Fiji’s first international bond was raised in September 2006 by the Government with a sum of US$150 million (FJ$300 million) which matured in September 2011.
This was issued at an interest rate of 6.875%.

In September 2011, the Government raised US$250 million through the second issue of Global Bond, to repay the first Global Bond.

The second issue was at a higher interest rate of 9% for a term of five years.

In 2015, US$200 million was raised by way of a third issue of Global Bond at an interest rate of 6.625% to refinance the Global Bond issued in 2011.

This 2015 issue of Global Bond will mature on 2 October 2020.
Refer to the table below for details of the issuing of Global Bond.

Year Bond Amount US($) 2006 150m Borrowing Revenue for year end at FJD Amount $’000 260,460.0 Principal Repayments FJD Interest Rate Amount $’000 --- (%) 6.875 2011 250m 452,305.2 266,051.8 9 2015 200m 434,593.7 528,357.2 6.625 Comments • • • • • • • • • 1st issue was in 2006 at an interest rate of 6.875%.

$260,460,000 was raised in 2006 as borrowing revenue.
2nd issue of bonds was to refinance the 1st global funds issued in 2006 and the remainder to finance priority capital investments in the 2011 budget.

$452,305,199 worth of global bonds raised in 2011 as borrowing revenue.

3rd issue of global bonds to assist in the repayment of the US$250m global bond issued in 2011.

$425,440,000 was the outstanding global bond balance as at 31/12/2015.
$434,593,655 worth of bonds were raised in 2015 as borrowing revenue from the issue of the US$200m worth of bonds $528,357,236 was the total principal repayment made to pay off the 2011 global bonds $63,563,241 was the total interest payments made to pay off the 2011 global bonds 2018 200m --- --- 6.625 • As at 31/07/2018, total interest payments made was $27,866,702 • No principal repayments made in 2018 • As per the 2015 Global Bond Terms and Conditions, the 2015 global bonds will mature on 2 October 2020 Investments Return on Investments Return on investment is a performance measure used to evaluate the efficiency of Government investments.
Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 91 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI An initial measure that corporatized entities are operating as successful businesses is 10% after tax return on shareholders’ funds.
Once the expectations of annual returns are established, the 10% baseline should be revised based on corporate plan targets.15 Government’s return on investment over the past five years from Government Commercial Companies and Commercial Statutory Authorities is highlighted in the table below and figure below.
Total Government Shareholding Amount $’000 Dividends from Investment Amount $’000 548,888.8 456,439.9 445,303.3 440,342.4 24,816.1 33,243.2 36,230.8 11,210.8 Return on Investments (%) 5 7 8 3 1,335,906.1 149,766.9 11 Expected Baseline (%) Return on Investment (%) Year 2014 2015 2016 2017 2018 ) % ( e t a R 15 10 5 - 2014 2015 2016 2017 2018 Our analysis of governments return on investments indicates that the overall average rate of return on investment has steadily increased from 5% in 2014 to 8% in 2016 and decreased to 3% in 2017 before increasing again to 11% in 2018.
Over the five years period, an overall average rate of return on investments of 6.4% has been recorded with the highest overall average of 9% attained in 2018.

Collectively, the 10% baseline has not been achieved.

Analysis of Dividends and Investments The forecast for dividend revenue in 2018 was $148 million while actual dividend revenue received for the year totalled $149.7 million resulting in a favourable variance of $1.7 million or 1.1%.
The movement of dividend received over the past five years is shown in the table below.

Year 2014 2015 Total Government Shareholding Amount $’000 548,888.8 456,439.9 Dividends from Investment Amount $’000 24,816.1 33,243.2 Percentag e Change in Dividend (%) 107 34 No.

of Dividend Paying Entities 6 5 No.
of Entities Holding Government Investments 24 24 Percentage of Dividend Paying Entities (%) 25 21 15 Corporate Governance Policy Framework – December 2003, Part II, Section 22 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 92 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Year 2016 2017 2018 [*]: 7 months Total Government Shareholding Amount $’000 445,303.3 440,342.4 1,335,906.0 Dividends from Investment Amount $’000 36,230.8 11,210.8 149,767.0 Percentag e Change in Dividend (%) 9 (69) 1,236 No.
of Dividend Paying Entities 4 5 4 No.
of Entities Holding Government Investments 25 22 22 Percentage of Dividend Paying Entities (%) 16 23 18 Refer to the figure below for the graphical analysis of dividends collected over the 5-year period: Dividends from Investment ) $ ( t n u o m A 140,000,000 120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 2014 2015 2016 Years 2017 2018 Over the past 5 years, the number of entities paying dividends to Government averaged 5 compared to the average of 22 companies in which investments have been made.
The low average number of entities remitting dividends to Government indicates the high number of non- performing portfolios and thus warrants stringent review of the investments, in order to receive maximum returns.

Dividends Remitted per Entity An initial measure that corporatized entities are operating as successful businesses is 10% after tax return on shareholders’ funds.
Once the expectations of annual returns are established, the 10% baseline should be revised based on corporate plan targets.16 A total of $149.8 million was received by government as dividends in 2018 from two17 government commercial companies and two18 minority owned companies.

In addition to dividends received from the above companies, the government also received a sum of $27.4 million as dividend from Reserve Bank of Fiji and JP Morgan.
For details of dividends remitted to government in the past five years refer to the table below.
16 Corporate Governance Policy Framework – December 2003, Part II, Section 22 17Airports Fiji Limited and Energy Fiji Limited 18 Amalgamated Telecom Holdings Limited and Fiji Ports Corporation Limited Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 93 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI All Government Commercial Companies and Commercial Statutory Authorities pay at least 50% of the net earnings to the Government as dividends in consultation with the Minister for Public Enterprises, Minister of Economy, and relevant Minister.19 A total of $11.2 million was received by government as dividends in 2017 from three20 government commercial companies and two21 minority owned company.
In addition to dividends received from the above companies, the government also received a sum of $14 million as dividend from Reserve Bank of Fiji and JP Morgan.

For details of dividends remitted to government in the past five years refer to the table below.
Description Post Fiji Limited UTOF (Management) Limited Dividend from JP Morgan Dividend from RBF Air Terminal Services Yaqara Pastoral Company Ltd Fiji Ports Corporation Limited Airports (Fiji) Limited ATH Limited Public Trustee Energy Fiji Limited Dividends from Investments Value of Investments as at 31/07/2018 ($) 5,600,000 50,000 Percentage of Dividend to total Investments value --- --- Dividend for 2018 Dividend for 2017 Dividend for 2016 Dividend for 2015 Dividend for 2014 ($) --- --- ($) --- 367,383 ($) ($) 1,249,574 --- --- --- ($) --- 119,256 765,000 1,191,846 --- --- 173,899 184,923 27,284,175 13,912,912 --- --- --- 528,768 401,006 --- 1,900,000 1,424,941 --- 3,300,000 29,993,490 25% 7,566,057 2,335,796 2,616,854 3,719,191 3,698,979 92,300,180 219,627,977 2 749,952,450 1,099,480,945 97.5% 2% --- 3 11% 90,000,000 4,742,797 --- 5,107,627 1,500,000 --- --- 20,000,000 149,766,928 25,308,640 30,000,000 2,188,983 --- --- 36,230,778 17,528,344 10,000,000 7,296,610 10,217,338 --- --- --- --- 33,243,215 24,816,121 The above table shows that Fiji Ports Corporation Limited and Airports Fiji Limited have met the 10% required dividend remittance in accordance with Public Enterprises Corporate Governance Policy Framework.
Airports Fiji Ltd paid to Government a total of $90 million dividend in 2018 which also included a $45 million dividend declared for 2017.

A graphical representation of budgeted and actual dividend revenue remitted by Government entities over the five-year period is outlined in the table and figure below.
Descriptions Actual Dividends Budgeted Dividends % of Budgeted Dividends collected 2018 ($) 2016 ($) 149,766,928 25,308,640 36,230,778 33,243,215 24,816,121 148,015,527 39,000,000 32,860,165 41,290,000 36,121,700 2014 ($) 2017 ($) 2015 ($) 101% 65% 110% 81% 69% 19 Corporate Governance Policy Framework – December 2003, Part II, Section 26 20 Fiji Public Trustee Corporation Limited, Unit Trust of Fiji (Management) Limited and Yaqara Pastoral Company Limited 21 Amalgamated Telecom Holdings Limited and Fiji Ports Corporation Limited Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 94 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI ) m $ ( t n u o m A 160 140 120 100 80 60 40 20 - Budget Actual 2014 2015 2016 Year 2017 2018 Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 95 Signing of Financial Statements SFS             REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI APPENDIX C: ASSESSMENT OF FINANCIAL GOVERNANCE The following table summarizes our assessment of controls and the 2017-2018 financial statement preparing processes across Ministries and Departments which were audited.
Ministry or Department Internal Controls Financial Statements Preparation Responses to OAG CE RA CA IC MA T YE General Administration Sector  1.

Office of the President  2.

Office of the Prime             Q   MC   Minister Department Immigration of          3.

Office of the Attorney General 4.

Ministry of Economy 5.

Ministry of Affairs iTaukei 6.

Ministry Defence and National Security 7.

Ministry of Employment, Productivity Industrial Relations 8.
Ministry of Foreign and 9.

Affairs Independent Bodies Judiciary 10.

Parliament 11.

Office of the Director of Public Prosecutions 12.

Ministry of Disaster and Management Meteorological Services 13.

Ministry of Justice 14.

Fiji Corrections Service 15.

Ministry of Communication 16.

Information, Technology Computing Services & 17.

Ministry Service of Civil 18.


Ministry of Rural and Maritime Development                                                                                                                                                          19.

Republic of Fiji Military         Forces 20.

Fiji Police Force 21.


Peacekeeping Missions Social Services Sector                     Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 96 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Ministry or Department Internal Controls Financial Statements Preparation Responses to OAG 22.

Ministry of Education, Heritage and Arts and Higher Education Institutions 23.

Ministry of Health and Medical Services 24.

Department Housing of 25.


Ministry of Women, Children and Poverty Alleviation 26.

Ministry of Youth and Sports Economic Services Sector 27.

Ministry of Agriculture 28.

Ministry of Fisheries 29.

Ministry of Forests 30.

Ministry of Lands and Mineral Resources 31.

Ministry of Industry, Trade and Tourism 32.

Ministry of Sugar 33.


Ministry of Public Enterprise CE  RA CA IC MA     T  YE                                                                               Q             34.

Ministry of Government Housing 35.

Ministry Local and         of         Environment Infrastructure Sector 36.
Ministry Infrastructure Transport of and         MC                Signing of Financial Statements SFS                37.
Ministry of Waterways           CE=Control Environment RA=Risk Assessment Q=Quality of draft financial statement C=Information and Communication Control CA=Control Activities YE= Year-end close processes T=Timeliness of draft financial statements MA=Monitoring Activities MC=Management Comments Provided SFS=Signed Audited financial statements returned Timeliness of Management Comments To assess the timeliness of management comments, we have compared the date the agency financial statement draft management letter (DML) was issued and the date management comments were received.
SFS = Signing of Financial Statements MC = Management comments received Report on 2017-2018 Financial Statements of Government & Annual Appropriation Statement 97 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI Rating Timeliness of management comments  Effective  Generally effective  Ineffective Management comments received within 14 days Management comments received within 21 days Management comments received after 21 days Timeliness of Signed Accounts Received To assess the timeliness of signed accounts received, we have compared the date the financial statements were sent to Ministries/Departments for signing and the date the signed financial statements were received.
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& - 7 1 0 2 n o t r o p e R REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 APPENDIX E: GLOSSARY Term Accountability Accounting estimates Appropriation Audit evidence Audit Memorandum Audit strategy Consolidated fund account Deferred income Deficiencies Express an opinion Fraud Governance International Public Sector Accounting Standards (IPSAS) under cash basis of accounting Management Material misstatement Misstatement Other significant matter Reasonable assurance Re-deployment Revaluation Ministry of Economy Definition Responsibility of public sector entities to achieve their objectives in reliability of financial reporting, effectiveness and efficiency of operations, and compliance with applicable laws.
An approximation of a monetary amount in the absence of a precise mean of measurement.

This term is used for an amount measured at fair value where there is estimation uncertainty, as well as for other amounts that require estimation.

A sum of total budget for the ordinary services of government for the financial year ending 31 July 2018.

All the information used by the auditor in arriving at the conclusions on which the audit opinion is based.
Audit evidence includes the information contained in the accounting records underlying the financial statements and other information.

Management Letter highlighting areas where improvements can be made by an entity following an audit.

The strategy that sets the scope, timing and direction of the audit, and guides the development of the more detailed audit plan.

The main bank account of the government where public monies are paid into for the operations of government.
Trust money is not paid into this account.

Deferred income refers to money received by an entity before it provides the related goods or services to the customer.

Failings, weaknesses or shortcomings.

A written expression of the auditor’s overall conclusion on the financial report based on audit evidence obtained.
An intentional act by one or more individuals among management, those charged with governance, employees, or third parties, involving the use of deception to obtain an unjust or illegal advantage.

The control arrangements in place at an entity that are used to govern and monitor its activities to achieve its strategic and operational goals.

Standards adopted by Government of Fiji for financial reporting of Financial Statements of Government.
Those with the executive responsibility for conducting an operation.

A significant difference between the amounts, classification, presentation, or disclosure of a reported financial statement item and the amount, classification, presentation, or disclosure that is required for the item to be in accordance with the applicable financial reporting framework.
A difference between the amounts, classification, presentation, or disclosure of a reported financial report item and the amount, classification, presentation, or disclosure that is required for the item to be in accordance with the applicable financial reporting framework.

Misstatements can arise from error or fraud.


Include control weaknesses which could cause or is causing severe disruption of the process or severe adverse effect on the ability of an auditee to achieve process objectives and comply with relevant legislation.

It is likely that these issues may have an impact on the operations of the entities in future, if necessary action is not taken to address them.

A high but not absolute level of assurance.


Transfer of budgeted funds from one appropriation head to another which is approved by Cabinet.

An adjustment made to the recorded value of an asset to accurately reflect its current market value.
Head 4: Page 107 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Term Risks Standards on auditing Trading and Manufacturing activities Value-adding Virements Definition The probability or threat of quantifiable damage, injury, liability, loss, or any other negative occurrence that is caused by external or internal vulnerabilities, and that may be avoided through pre-emptive action.
International Standards on Auditing adopted by Fiji Institute of Accountants and applied by Office of the Auditor-General for audits carried out.

Are operated on semi-commercial basis to increase the returns which are derived from them and to provide goods, services or works more cost-effectively.

Financial or non-financial gains arising from improved compliance or mitigation of risks.
Permanent Secretaries of Ministries and Departments may authorise the transfer of budgeted funds between Standard Expenditure Groups as per section 10(1) of the Finance Instructions 2010.
Ministry of Economy Head 4: Page 108 This page has been intentionally left blank Part C: 2017-2018 Agency Financial Statement of Ministry of Economy REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 HEAD 4 MINISTRY OF ECONOMY Role and Responsibilities The Ministry of Economy is responsible for managing public finances in accordance with the Fijian Constitution and the Finance Management Act 2004.
The Ministry formulates Government's national budget and coordinates with other ministries and departments to ensure effective implementation.

The Ministry through its various functional units promotes sound management of the Fijian economy via economic analysis, efficient budgeting and pro-active planning, including prudent management of financial assets and debts and the administration of fiscal policy and tax collection through the Fiji Revenue and Customs Service ('FRCS').
Other major roles include: coordination and management of Government's capital construction projects including its offices and accommodation; formulation of national development plans, including climate change policy and financing and monitoring of programmes and projects under the national budget; and ensuring effective operation of the Fiji Bureau of Statistics ('FBOS') in collating, storing and publishing statistical information in a timely and coherent manner.
TABLE OF CONTENTS HEAD 4 MINISTRY OF ECONOMY ..................................................................................................... 109 PART A: FINANCIAL STATEMENTS ................................................................................................... 111 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 Audit Opinion ..................................................................................................................... 111 Statement of Receipts and Expenditure – Head 4 .......................................................... 111 Statement of Receipts and Expenditure – Head 50 ........................................................ 112 Statement of Receipts and Expenditure – Head 51 ........................................................ 113 Statement of Receipts and Expenditure – Head 52 ........................................................ 113 Statement of Receipts and Expenditure – Head 13 ......................................................... 113 Appropriation Statement – Head 4 .................................................................................. 114 Appropriation Statement – Head 50 ................................................................................ 114 Appropriation Statement – Head 51 ................................................................................. 115 4.10 Appropriation Statement – Head 52 ................................................................................ 116 4.11 Appropriation Statement – Head 13 ................................................................................ 116 4.12 Statement of Losses .......................................................................................................... 117 4.13 Fiji Procurement Office TMA – Profit & Loss Statement ................................................ 117 4.14 Fiji Procurement Office TMA – Balance Sheet ................................................................ 117 4.15 Office Accommodation TMA – Profit & Loss Statement
 ................................................ 118 4.16 Office Accommodation TMA – Balance Sheet ................................................................ 119 4.17 Consolidated Trust Fund Account Statement ................................................................. 119 PART B: ASSESSMENT OF FINANCIAL GOVERNANCE ..................................................................... 122 4.18 Internal Control ................................................................................................................. 122 4.19 Submission of 2017 - 2018 Draft Agency Financial Statements ...................................... 124 Head 4: Page 109 Ministry of Economy REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 4.20 Quality of Draft Financial Statements ............................................................................. 124 4.21 Timeliness of Draft Financial Statements ........................................................................ 125 4.22 Timeliness of Provision of Management Comments and Signing of Financial Statements ..................................................................................................................................... 125 PART C: OTHER SIGNIFICANT MATTERS .......................................................................................... 127 4.23 Trading and Manufacturing Account - Receivables Not Recorded ................................ 127 4.24 Variance in LTA Revenue ................................................................................................... 128 4.25 Absence of Risk Management Policy, Strategic Plan and Operational Plan ................. 129 4.26 Arrears of Revenue Not Recorded ................................................................................... 130 4.27 Administration of Environmental and Climate Adaption Levy ...................................... 130 4.28 Presentation of Main Trust Fund Account - Recurring Issue
 ......................................... 131 4.29 Delay in Finalisation of Financial Statements - Recurring Issue .................................... 132 FINANCIAL STATEMENTS OF GOVERNMENT .................................................................................. 134 4.30 Internal Control Weaknesses for Ministries and Departments ..................................... 134 4.31 Variance in Payroll ............................................................................................................. 135 4.32 Annual Report on Whole of Government ........................................................................ 136 4.33 Ageing Reports not maintained for VAT & Income Tax Refunds Outstanding ............ 137 4.34 Implementation of Activities proposed in the PFTAC Report ....................................... 138 4.35 Delay in finalization of the Financial Statements of Government................................. 138 4.36 Main Trust Fund Account .................................................................................................. 140 4.37 Detailed Listing not maintained for Main Trust Fund Account ..................................... 141 4.38 Variances in Main Trust Accounts .................................................................................... 142 4.39 4.40 4.41 4.42 4.43 4.44 4.45 Reconciliations not prepared for Main Trust Fund Account – Judicial ..................... 143 Significant Outstanding Operating Trust Fund Balance ............................................. 144 Variances between FMIS General Ledger and Bank Reconciliations ........................ 146 Overseas bank accounts not reported at Closing Rate .............................................. 148 Debt Unit Internal Control Assessment ....................................................................... 149 Undrawn Borrowing Facilities ...................................................................................... 149 Accounting for Green Bond
 Fund ................................................................................. 151 APPENDIX 1: MINISTRY OF ECONOMY FINANCIAL STATEMENT AMENDMENTS ......................... 153 APPENDIX 2: INTERNAL CONTROL WEAKNESSES ACROSS MINISTRIES ...................................... 154 APPENDIX 3: PFTAC ACTIVITIES YET TO BE IMPLEMENTED........................................................... 156 APPENDIX 4: CAUSE OF DELAY IN FINALISATION OF FINANCIAL STATEMENTS ......................... 157 APPENDIX 5: AUDIT ADJUSTMENTS FOR FINANCIAL YEAR 2017/2018 .......................................... 161 Ministry of Economy Head 4: Page 110 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 PART A: FINANCIAL STATEMENTS 4.1 Audit Opinion The main outcome of an audit is an independent auditor’s report on the agency financial statements that were produced and submitted to the Auditor-General.
The audit of the 2018 accounts of the Ministry of Economy resulted in an unqualified audit opinion with an emphasis of matter.

Emphasis of matter The Office Accommodation Trading Manufacturing Account (TMA) on Schedules 14 & 15 is a semi- commercial arm of the Ministry that caters for the commercial rent out of government quarters.
The detailed Quarters Rental Listing has not been correctly updated and maintained resulting in Accounts Receivables of $1.4 million not reflected in the Balance Sheet as at 31 July 2018.The Ministry has agreed to resolve the matter in the 2018-2019 Agency Financial Statements.

My opinion was not modified in respect of this matter.
4.2 Statement of Receipts and Expenditure – Head 4 The Ministry of Economy budget which was appropriated under Head 4 in the 2017 – 2018 Budget Appropriation Act, also included the Fiji Bureau of Statistics (FBOS).

The Ministry recorded revenue totalling $3.8 billion and incurred expenditures totalling $92.9 million for the year ended 31 July 2018.

Details are provided in Table 4.1.
Table 4.1: Head 4 – Consolidated Statement of Receipts and Expenditure in 2018 Description State Revenue Operating Revenue Investment Revenue Borrowing Revenue Total State Revenue Agency Revenue Board Member Fee Miscellaneous Revenue Sales of Publications Total Agency Revenue TOTAL REVENUE Operating Expenditure Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure 31 July 2018 ($) 3,009,325,970 164,950,829 603,836,967 3,778,113,766 196,699 6,315,106 735 6,512,540 3,784,626,306 11,169,702 689,684 939,826 1,328,859 1,772,110 54,246,153 13,561,068 83,707,402 31 July 2017 ($) 2,720,192,966 34,131,769 435,996,544 3,190,321,279 85,411 18,769,432 1,118 18,855,961 3,209,177,240 10,286,158 531,772 752,012 1,293,354 1,590,294 51,743,773 5,319,864 71,517,227 Ministry of Economy Head 4: Page 111 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Description Capital Purchase Capital Grants and Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE 31 July 2018 ($) --- 8,812,500 8,812,500 441,869 92,961,771 31 July 2017 ($) 131,564 11,750,000 11,881,564 670,805 84,069,596 Operating revenue consisted of taxes, fees, fines & charges, commission, reimbursement & recoveries and grant-in-aid.
Investing revenue comprised dividends from investments, mainly from Airports Fiji Limited of $90 million22, Energy Fiji Limited of $20 million, Fiji Ports Corporation Limited of $7.6 million and Amalgamated Telecom Holdings Limited of $4.7 million, repayments from term loan receivables, interest income, and return of investment surplus and disposal of investment of $1.4 million.

Borrowing revenue was made up of proceeds from issue of Domestic Bonds and through overseas borrowings.
The increase in 0perating revenue by $289.1 million or 11% in 2018 compared to 2017, was driven largely by the increase in the collection of tax revenue.

Investing revenue increased by $130.81 million or 383% in 2018, which was due mainly to a $90 million dividend received from Airports Fiji Ltd.

Borrowing revenue also increased by $167.84 million or 38% from the previous year, which resulted largely from the increase in Domestic Bonds from $224.5 million to $535.6 million in 2018.
4.3 Statement of Receipts and Expenditure – Head 50 The Ministry incurred expenditures totalling $535.8 million under Head 50 in 2018.

Refer to Table 4.2 for details.
Table 4.2: Head 50 - Statement of Receipts and Expenditure in 2018 Description Established Staff Travel & Communications Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Expenditure Capital Construction Capital Purchases Capital Grants and Transfers Total Capital Expenditure Value Added Tax TOTAL EXPENDITURE 31 July 2018 ($) 43,712,492 3,557,810 29,846,654 18,064,475 12,352,746 107,534,177 10,063,855 28,220,981 383,451,355 421,736,191 6,627,773 535,898,141 31 July 2017 ($) 2,962,036 4,729,246 30,392,595 16,267,753 7,936,547 62,288,177 1,109,060 17,664,495 295,806,195 314,579,750 4,832,382 381,700,309 Total expenditure increased by $154.2 million or 40% in 2018 compared to 2017.
22 AFL dividend of $90 million was for FY 2017 & 2018 Ministry of Economy Head 4: Page 112 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Established Staff costs increased by $40.7 million and was due to the regularisation of the over- spending by the Ministry of Education, Heritage and Arts.

Capital Grants and Transfer increased by $87,645,160 in 2018 compared to 2017.
This was due to the inclusion of expenditures for Ongoing Rehabilitation and Construction of Schools during the year.

4.4 Statement of Receipts and Expenditure – Head 51 The Ministry incurred expenditures amounting to $36.9 million from Head 51 during the financial year ending 31 July 2018.

Refer to Table 4.3 for details.
Table 4.3: Head 51 - Statement of Receipts and Expenditure in 2018 Description Pensions Gratuities Cost of Living Adjustment TOTAL EXPENDITURE 31 July 2018 ($) 36,337,679 619,009 --- 36,956,688 31 July 2017 ($) 26,981,472 1,844,669 6,054,272 34,880,413 4.5 Statement of Receipts and Expenditure – Head 52 Finance charges on public debt totalled $498.6 million in 2018, an increase of $74.7 million or 18% compared to $423.9 million in 2017 due to increases in interest and loan payments.
Details are shown in Table 4.4.
Table 4.4: Head 52 - Statement of Receipts and Expenditure in 2018 Description Finance Charges on Public Debt Miscellaneous Payment Interest and Principal Payments Overseas Loan Domestic Loan TOTAL EXPENDITURE 31 July 2018 ($) 31 July 2017 ($) 1,935,831 1,867,169 91,804,309 404,926,636 498,666,776 93,145,304 328,985,301 423,997,774 4.6 Statement of Receipts and Expenditure – Head 13 Operating grants and transfers totalling $8.4 million was paid to the Fiji Independent Commission Against Corruption (FICAC) to finance its operations.
Refer to Table 4.5 for details.
Table 4.5: Head 13 - Statement of Receipts and Expenditure in 2018 Description Operating Grants & Transfers TOTAL EXPENDITURE 31 July 2018 ($) 8,480,987 8,480,987 31 July 2017 ($) 8,480,987 8,480,987 Ministry of Economy Head 4: Page 113 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 4.7 Appropriation Statement – Head 4 The Ministry incurred expenditures totalling $92.9 million in 2018 against a revised budget of $117.2 million, resulting in a saving of $24.3 million or 21%.
Details of expenditures against the revised budget are provided in Table 4.6.

Savings against the revised budget were due to the following: (i) (ii) Delays in filling of vacant positions which resulted in low utilisation of funds.

Special expenditures, namely: ▪ Technical assistance was received resulting in the budget for National Asset Management Framework, Climate Change Policy and training for climate financing being unutilised.
▪ Economic Intelligence Unit – certain existing staff and resources were used together with the support from FCCC and FRCS.

This was also the first year of establishment for the Unit.

▪ Population and Housing Census in appointment of Area Coordinators, lower rates noted on Government shipping vessels as budget projection was based on private hire rates for these shipping vessels.

Moreover, the server to store Census data was not purchased.
- Delay (iii) Grants for FRCS was released on need for funding basis.
Table 4.6: Head 4 - Appropriation Statement for 2018 SEG Item Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Expenditure Capital Grants & Transfers Total Capital Expenditure Value Added Tax TOTAL Budget Estimate ($) 16,652,866 594,667 Changes ($) Revised Budget ($) (374,300) 344,300 16,278,566 938,967 Actual Expenditure ($) 11,169,702 689,684 Lapsed Appropriation ($) 5,108,864 249,283 1,418,258 138,000 1,556,258 939,826 616,432 1,886,500 79,000 1,965,500 1,328,859 636,641 2,402,850 (127,000) 2,275,850 1,772,110 503,740 64,658,097 1,200 64,659,297 54,246,153 10,413,144 15,961,738 (61,200) 15,900,538 13,561,068 2,339,470 103,574,976 11,750,000 11,750,000 1,950,400 117,275,376 - - - - - 103,574,976 83,707,402 19,867,574 11,750,000 8,812,500 2,937,500 11,750,000 8,812,500 2,937,500 1,950,400 117,275,376 441,869 92,961,771 1,508,531 24,313,605 Savings (%) 31 27 40 32 22 16 15 19 25 25 77 21 4.8 Appropriation Statement – Head 50 Miscellaneous Services is administered by the Ministry of Economy.
The funding provided under Head 50 include the contingency funding and other common central pools of funds that are available to the Whole of Government (WoG).

It also includes funding for activities that require scrutiny and monitoring by the Ministry of Economy.
Ministry of Economy Head 4: Page 114 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 The Ministry incurred expenditures totalling $535.9 million in Head 50 in 2018 against a revised budget of $704.2 million resulting in a saving of $168.3 million or 24%.

Funds were mainly released on need for funding basis, thus the savings recorded.

Details of expenditures against the revised budget are provided in Table 4.7.
Table 4.7: Head 50 - Appropriation Statement for 2018 SEG Item Budget Estimate ($) Changes ($) Revised Budget ($) Actual Expenditure ($) Lapsed Appropriation ($) Savings (%) 1 3 Established Staff Travel & Communications Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Value Added Tax TOTAL 10,482,394 5,438,292 33,230,098 200,000 43,712,492 5,638,292 43,712,492 3,557,810 --- 2,080,482 44,702,800 (10,116,147) 34,586,653 29,846,654 4,739,999 18,742,986 285,628 19,028,614 18,064,475 964,139 30,132,368 (4,195,628) 25,936,740 12,352,746 13,583,994 109,498,840 19,403,951 128,902,791 107,534,177 21,368,614 19,291,580 (917,432) 18,374,148 10,063,855 8,310,293 44,721,373 442,060,335 28,220,981 35,457,479 (9,263,894) 68,088,174 510,148,509 383,451,355 7,236,498 126,697,154 506,073,288 57,906,848 563,980,136 421,736,191 142,243,945 12,544,673 628,116,801 (1,220,172) 6,627,773 11,324,501 76,090,627 704,207,428 535,898,141 4,696,728 168,309,287 --- 37 14 5 52 17 45 20 25 25 41 24 4.9 Appropriation Statement – Head 51 The Pensions Section manages the computation and payment of various pensions in accordance with existing pension legislation.
The Section also processes re-engagement benefits for prisons, military officers and forest guards.

The section oversees the payment of pensions to Government Pensioners, Ex-Parliamentarians, Ex-Prime Ministers and Presidents, Ex-Chief Justices and Retired Judges, Service Pensioners and the widows and orphans of deceased public officers.

The Ministry incurred expenditures totalling $36.9 million under Head 51 against a revised budget of $46.2 million, resulting in a saving of $9.3 million or 20% for 2018.
The savings resulted from the decrease in the number of pensioners due to high mortality rate and temporary ceasing of pension payments due to non-submission of Life Certificates, which is required to be submitted by pensioners on a six monthly basis.

Details of expenditure against the revised budget are provided in Table 4.8.
Table 4.8: Head 51 - Appropriation Statement for 2018 Ministry of Economy Head 4: Page 115 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 SEG Item Budget Estimate ($) Changes ($) Revised Budget ($) Actual Expenditure ($) Lapsed Appropriation ($) 11 Pensions Gratuities Total 45,315,100 906,000 46,221,100 (20,576) 45,294,524 926,576 --- 46,221,100 20,576 36,337,679 619,009 36,956,688 8,956,845 307,567 9,264,412 4.10 Appropriation Statement – Head 52 Appropriation Head 52 – Charges on Account of Public Debt was allocated for the repayment of domestic and overseas loans.
The Ministry incurred expenditures totalling $498.6 million in Head 52 in 2018 against a revised budget of $525.4 million, resulting in a saving of $26.8 million or 5%.

Details of expenditure against the revised budget are provided in Table 4.9.

Savings against the revised budget were due to the following: ▪ Provision of $3.5m that had been allocated for any “call on Government” for guaranteed loans.
At the close of the fiscal year, there was no “call on Government” for guaranteed loans for which a provision of $3.5 million was allocated.

▪ Lower than anticipated depreciation of the Fijian dollar against currencies in which overseas loans are dominated; namely the Euro, Chinese Yuan, Japanese Yen and the United States dollar.

▪ Lower average cost of borrowings via the issuance of bonds (6.5% to 7%) than what was anticipated (7%).
Table 4.9: Head 52 - Appropriation Statement for 2018 SEG Item Budget Estimate ($) Changes ($) Revised Budget ($) Actual Expenditure ($) Lapsed Appropriation ($) Finance Charges on Public Debt 12 Miscellaneous Payment 14 Overseas Loans Domestic Loans 15 TOTAL 10,093,132 --- 10,093,132 1,935,831 8,157,301 111,111,064 404,225,900 525,430,096 91,804,309 --- 111,111,064 --- 404,225,900 404,926,636 --- 525,430,096 498,666,776 19,306,755 (700,736) 26,763,320 4.11 Appropriation Statement – Head 13 The Ministry incurred expenditures totalling $8.4 million in Head 13 in 2018 against a revised budget of $8.4 million.
The expenditure relates to grants paid to the FICAC.

Details of expenditure against the revised budget are provided in Table 4.10.
Table 4.10: Head 13 - Appropriation Statement for 2018 Ministry of Economy Head 4: Page 116 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 SEG Item 6 Operating Grants & Transfers TOTAL Budget Estimate ($) 8,480,987 8,480,987 Changes ($) --- --- Revised Budget ($) 8,480,987 Actual Expenditure ($) 8,480,987 8,480,987 8,480,987 Lapsed Appropriation ($) --- --- 4.12 Statement of Losses The Ministry of Economy did not record any loss of money or revenue in 2018.
However, assets worth $322,714 were written off following the Board of Survey conducted for the Ministry of Economy, Fiji Procurement Office (FPO) and the FBOS during the year.

Table 4.11: Assets Written Off for 2018 Assets Furniture, Fixtures & Fittings Office Equipment Total Amount ($) 198,280 124,434 322,714 4.13 Fiji Procurement Office TMA – Profit & Loss Statement The FPO operates a TMA selling Fiji flags.
The TMA was transferred from the former Government Supplies Department, a retail arm of Government.

The Profit & Loss Statement – TMA showed a net profit of just over $1 million for the year ended 31 July 2018 compared to $1.1 million in 2017.

Refer to Table 4.12 for details.


Table 4.12: Profit & Loss Statement – FPO Description Income Sales Cost of Finished Goods Sold Gross Profit Expenses Office Upkeep & Supplies Other Expenses Total Expenses Net Profit 31 July 2018 ($) 31 July 2017 ($) 1,119,372 (11,137) 1,108,235 1,221,436 (50,229) 1,171,207 59,147 --- 59,147 1,049,088 1,991 15,431 17,422 1,153,785 Sales decreased by $102,064 or 8% in 2018 compared to 2017.
This was due to the reduction in the sale of flags and collection of administration (indent fees) charges levied on Ministries.

4.14 Fiji Procurement Office TMA – Balance Sheet Ministry of Economy Head 4: Page 117 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 In 2018, net assets totalled $1.5 million, which decreased by $227,339 or 13% compared to 2017.

This was due to the reduction in the sale of flags.

Refer to Table 4.13 for details.
Table 4.13: Balance Sheet Description Current Assets Cash at Bank Finished Goods Total Assets 31 July 2018 ($) 31 July 2017 ($) 1,412,058 176,749 1,588,807 1,776,427 24,915 1,801,342 Liabilities Deposits & Deductions Total Liabilities 39,661 39,661 24,857 24,857 Net Assets 1,549,146 1,776,485 Equity TMA Surplus Transferred to Consolidated Fund TMA Accumulated Surplus Net Profit Total Equity (6,558,242) (5,281,815) 7,058,300 1,049,088 1,549,146 5,904,515 1,153,785 1,776,485 4.15 Office Accommodation TMA – Profit & Loss Statement The Office Accommodation TMA provides housing for eligible civil servants.
In 2009, the responsibility of the function was extended to commercial rental to interested members of the public resulting in the establishment of the TMA in 2011.

The TMA is solely responsible for the semi- commercial nature that caters for commercially renting out of quarters.23 The Profit & Loss Statement – TMA showed a net profit of $3,483,527 as at 31 July 2018 compared to $2,968,328 in 2017.

Refer to Table 4.14 for details.
Table 4.14: Profit & Loss Statement – Office Accommodation Description 31 July 2018 ($) 31 July 2017 ($) Income Rental from Quarters 4,082,550 3,857,870 23 Office Accommodation & Government Housing, Construction Implementation Unit, Ministry of Economy TMA Business Plan 2016 Ministry of Economy Head 4: Page 118 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Description Expenses Other Expenses Total Expenses Net Profit 31 July 2018 ($) 31 July 2017 ($) 599,023 599,023 3,483,527 889,542 889,542 2,968,328 Other expense decreased by $290,519 in 2018 compared to 2017.
This was due to reduction in refurbishment of quarters during the financial year.

4.16 Office Accommodation TMA – Balance Sheet In 2018, the net assets of the activity totalled $4,007,937 which increased by $538,647 or 16% compared to 2017, due to increase in Cash at Bank by $503,003 or 14% and decrease in total liabilities by $35,644 or 19%.

Refer to Table 4.15 for details.
Table 4.15: Balance Sheet Description Current Assets Cash at Bank Total Assets Liabilities Accounts Payable Deposits & Deductions VAT Liability Total Liabilities 31 July 2018 ($) 31 July 2017 ($) 4,164,518 4,164,518 3,661,515 3,661,515 210 23,341 133,030 156,581 45,875 13,020 133,330 192,225 Net Assets 4,007,937 3,469,290 Equities TMA Surplus Transferred to Consolidated Fund TMA Accumulated Surplus Net Profit Total Equity (6,680,546) (3,735,666) 7,204,956 3,483,527 4,007,937 4,236,628 2,968,328 3,469,290 4.17 Consolidated Trust Fund Account Statement The Ministry maintained 10 main trust fund accounts, details of which are provided below.
1.

Performance Bond - These are performance bonds for tenders awarded by the Fiji Procurement Office for which payments are made according to the tender contracts.

2.

Tuna Stabilization Fund - To facilitate the Tuna Stabilization Fund (TSF) Policy.

The underlying purpose of the TSF policy is to transfer a portion of fuel subsidies received by foreign fishing companies and vessels from their states and distribute it to locally owned fishing companies as a form of subsidy.

3.
3.

Prime Minister’s National Disaster Relief and Rehabilitation - Cyclone Winston Trust - This account is used for donations received for Cyclone Winston relief from various donors.

Donors Head 4: Page 119 Ministry of Economy REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 either directly deposit funds into the bank accounts, or issued cheques which are received and receipted at the Treasury section in Ministry of Economy.

4.
4.

Group Insurance Trust Account - This trust account receives insurance payment and after assessment pay-out is made to the nominees of the insurance policy holders upon their death.

5.

Miscellaneous Fund v Others - This account was opened following Cabinet decision on "Effective management of trust monies - FIN 60/16" CP (09)72 of 16/06/09.

Surplus funds in Agency trust bank accounts was transferred into the Consolidated Trust Fund account.

6.
6.

ODA Performance and Tenancy Bond - Tenancy bonds are paid by tenants for occupation of quarters on rent.

7.

Adopt a School Trust Fund – This was established specifically to record funds received from donors who were willing to carry out the rehabilitation of schools.

8.

COP 23 Trust Fund - Conference of Parties 23 (COP 23) Trust - A trust fund account related to "COP 23 Presidency - Fiji" established via the COP 23 Presidency Trust Fund that receipt and disburse funds related to COP 23 activities.
9.

Accident Compensation Fund - Compensation of victims are paid out from the Accident Compensation Fund managed and administered by the Permanent Secretary responsible for Ministry of Economy as per section 30(4) of the Accident Compensation Act.
The Land Transport Authority receives the Motor Vehicle Accident Levies on behalf of Accident Compensation Commission Fiji (ACCF) and remits these funds into the Accident Compensation Fund (Trust Account) established under section 30 (1) of the Accident Compensation Act.

LTA charges ACCF in return LTA fees for these work carried out.

10.
10.

European Union Grant Assistance Trust Fund – This was set up specifically for the budget support funding given by the Commission Des Communautes (European Union) to assist post TC Winston for the cyclone recovery programme.

The closing trust fund balance decreased by $11.9 million or 20% in 2018 compared to 2017 due to closure of trust fund accounts for European Union Grant Assistance.

Refer to Table 4.16 for details.
Table 4.16: Trust Fund Accounts Description Opening Balance Receipts Performance Bond, Tender Deposit, Retention Monies & Interest Government Tuna Stabilisation Fund - Bunker levy (FRCS) & Interest Prime Minister’s National Disaster Relief and Rehabilitation: Cyclone Winston - Donation, Interest & Bank Reversal Group Insurance Trust - Insurance proceeds Miscellaneous Fund v Others - Bank Interest ODA Performance and Tenancy Bond - Funds received from Performance, Tenancy Bond, Bank Reversal & Interest Adopt A School – Donation, Interest and Bank Reversal COP 23 Trust Fund – Donation and Interest Accident Compensation Fund EU Grant Assistance – Grant Fund and Interest Total Receipts Payments Performance Bond Refund of Tender Deposit, Performance Bond, Retention Fund & Bank Fees IHRDP Trust Account - Payment to Ministry of Agriculture for the purchase of Fertilizer for the Waimalua Ginger Project Government Tuna Stabilization Fund - Bank Charges & Reversal Ministry of Economy 31 July 2018 ($) 31 July 2017 ($) 60,861,135 18,878,719 2,471,437 3,283,403 9,302 2,864,863 35,997 856,594 255,000 152,240 5,628 195,000 107,047 1,217 5,980,565 8,814,249 19,224,665 17,919,991 --- 409,138 22,553,548 39,631,512 53,348,506 7,840,134 2,129,881 1,305,978 --- 84,799 6,545,966 3,658 Head 4: Page 120 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Description Prime Minister’s National Disaster Relief and Rehabilitation: Cyclone Winston - Payment to Help for Home Initiative, Bank Charges Group Insurance Trust – Beneficiary payments & bank charges Miscellaneous Fund v Others - Bank Reversal ODA Performance and Tenancy Bond - Bank Charges Adopt A School – Construction and Interest Charges COP 23 Trust Fund – COP 23 Secretariat Payment and Interest Charges Accident Compensation Fund EU Grant Assistance – Grant Fund and interest Total Payments Closing Balance 31 July 2018 ($) 31 July 2017 ($) 682 329 267,131 --- 9,816 1,489,104 17,474,172 344,062 --- 24,434 3,520,291 6,082,539 --- 674,412 22,962,686 --- 51,553,850
 11,366,090 48,938,797 60,861,135 Ministry of Economy Head 4: Page 121 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 PART B: ASSESSMENT OF FINANCIAL GOVERNANCE 4.18 Internal Control This section evaluates the effectiveness of the internal controls maintained by the Ministry of Economy.
Internal controls are processes designed and implemented by Permanent Secretaries, Heads of Departments and other personnel of Ministries and Departments to provide reasonable assurance about the achievement of a ministry or department’s objectives with regard to reliability of financial reporting effectiveness and efficiency of operations, and compliance with applicable laws and regulations.

The term “control” refers to any aspects of one or more components of internal control.
Permanent Secretaries, Heads of Departments and other personnel of Ministries and Departments are responsible for the preparation of the financial statements in accordance with the FMA 2004 and Finance Instructions 2010, and for such internal control as they determine is necessary to enable preparation of financial statements that are free from material misstatements, whether due to fraud or error.
Internal control issues noted during our audit are reported to the Permanent Secretary or Head of Department of Ministries and Departments.

During our audit, we assess the design and implementation of controls to ensure that they are suitably designed to prevent, detect and correct material misstatements.

Where audit strategy requires, we also test the operating effectiveness to ensure the internal controls are functioning as designed.
A deficiency occurs when internal controls are unable to prevent, detect or correct errors in the financial statements or where controls are missing.

A significant deficiency is a deficiency that either or alone or in combination with multiple deficiencies may to lead to a material misstatement in the financial statements.

It requires immediate management action.

Internal controls are categorised against the following five components of internal control.
• Control Environment (CE) – is the set of standards, processes and structures that provide the basis for carrying out internal controls across the entity.

These include commitment to integrity and ethical values, independence of management to exercise oversight for the development and performance of internal control, documented structures, reporting lines and appropriate authorities such as delegated levels of authority and responsibilities in the pursuit of the entity’s objectives.
It also includes commitment to attract, develop and retain competent individuals, and holding them accountable for their internal control responsibilities.

Examples of issues which fall under this category are ethical breaches, gaps in internal controls or controls are non-existent, individuals are not held accountable for breaches in control or entities code of ethics, staff recruitment, and training and professional development, performance assessment and succession planning matters.
Ministry of Economy Head 4: Page 122 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 • Risk Assessment (RA) – involves a dynamic process for identifying and analysing risks to achieve the entity’s objectives, forming a basis for determining how risks should be managed.
Examples of issues which would fall under this category are absence of risk management framework, operational including fraud and enterprise risks not identified, assessed and mitigated and impact of changes in business processes on controls not identified and assessed.

• Control Activities (CA) – these are established by policies and procedures to help ensure that management’s directives to mitigate risks to the achievement of objectives are carried out.
Control activities are performed at all levels of an entity and at various stages within business processes, and over the technology environment.

Examples of issues which would fall under this category are general controls relating to information technology, documentation of procedures which have in-built checks and balances which are aligned to the policies of the entity.
Specific control activities include those relating to authorisation, performance reviews, information processing, physical controls, and segregation of duties.

• Information and Communication Control (IC) – information is necessary for the entity to carry out internal control responsibilities in support of achievement of its objectives.

Communication occurs both internally and externally and provides the entity with the information needed to carry out day-to-day controls.
Communication enables personnel to understand internal control responsibilities and their importance for the achievement of objectives.

Examples of issues which would fall under this category are reporting to boards and line ministries of entities on matters relating to internal controls • Monitoring Activities (MA) – on-going evaluations, separate evaluations or some combination of the two are used to ascertain whether controls are present and functioning.
Findings are evaluated and deficiencies are communicated in a timely manner.

Examples of issues which would fall under this category are self-assessment by entities to determine whether internal controls are present and function.

This may include the establishment of independent internal audit functions within entities which would assist in identifying any gaps in controls.
The following table outlines the rating we have used to assess internal controls: Rating Internal control assessment  Effective  Generally effective  Ineffective No deficiencies identified in internal controls Deficiencies identified in internal controls Significant deficiencies identified in internal controls A summary of assessment of key controls based on our audit was as follows: Control Environment Risk Assessment Control Activities    Information & Communication Control  Monitoring Activities  In view of the above, we have assessed the overall internal controls of the Ministry as: Ministry of Economy Head 4: Page 123 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Rating Internal control assessment  Generally effective Deficiencies identified in internal controls 4.19 Submission of 2017 - 2018 Draft Agency Financial Statements On 12 June 2018, the Permanent Secretary for Economy issued Circular No.
03/2018 –Closing of Accounts Processes & Procedures to Permanent Secretaries, Heads of Departments, High Commissioners and Ambassadors in Fiji Overseas Missions in which procedures for closing of 2018 accounts and times were detailed.

The final day for closing the 2018 accounts was 29 August 2018.
The key focus areas in the circular were: • Retirement of annual imprests by 20 July 2018 • Cancellation of unprocessed purchase orders by 27 July 2018 • Submission of arrears of revenue return by 3 August 2018 • Clearance of Inter-departmental clearance accounts by 3 August 2018 • Closing date for journal adjustments by 10 August 2018 • Processing of payments and virements by 20 August 2018 • Clearance of stale cheques by 22 August 2018 • Annual Board of Survey on Drawings Account cheques by 22 August 2018 • Completion of reconciliations by 29 August 2018 When Ministries and Departments achieve the key focus areas highlighted by the Permanent Secretary for Economy by the given dates, they are more likely to prepare accurate and timely draft financial statements for audit.
Rating Year-end close process assessment  Effective  Generally effective  Ineffective All 9 key processes completed by due date Five of 9 key processes completed within two weeks of due date Less than five of 9 key processes completed within two weeks of due date Based on information received, we have assessed the year-end close process as: Rating  Generally effective Year-end close process assessment 6 of 9 key processes completed within two weeks of due date The Ministry was able to complete six (6) out of the nine (9) processes within two weeks of the due date.
4.20 Quality of Draft Financial Statements The extent of audit adjustments made to draft financial statements indicates the effectiveness of an entity’s internal review processes before the accounts are submitted for audit.

We assessed the quality of financial statements by the impact these adjustments had on the total expenditures, operating results or net assets of the entity subject to our audit.
Ministry of Economy Head 4: Page 124 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Rating Quality of draft financial statements assessment  Effective  Generally effective  Ineffective No adjustments were required Adjustments on total expenditure, operating results/net assets were less than 1% (<1%) Adjustments on total expenditure, operating results/net assets were more than 1% (>1%) Our assessment of the Ministry of Economy was: Rating  Ineffective Quality of draft financial statements assessment Adjustments on operating results/net assets were more than one percent (>1%) Material adjustments were made for the 2018 draft financial statements the Ministry for Economy.
Refer to Appendix 1 for details.

4.21 Timeliness of Draft Financial Statements To assess the timeliness of acceptable draft financial statements, we have compared the date the draft financial statements were due and the date received.
Rating Timeliness of draft financial statements assessment  Effective  Generally effective  Ineffective Acceptable draft financial statements received on or before 15 October 2018 Acceptable draft financial statements received on or before 31 October 2018 Acceptable draft financial statements received after 31 October 2018 Accordingly, we have assessed timeliness of the draft financials statements submitted by the Ministry of Economy as: Rating  Ineffective Timeliness of draft financial statements assessment Various draft financial statements received between 1 November 2018 and on 25 August 2020 To be useful to users, financial statements should be completed and made available as soon as possible after close of financial year.
Information in financial statements becomes less relevant to users as the time passes from close of financial year.

The deadline set by Ministry of Economy for submission of draft financial statements was 31 October 2018.
4.22 Timeliness of Provision of Management Comments and Signing of Financial Statements To assess the timeliness in providing management comments and signing of financial statements, we have compared the dates the draft management letter and audited financial statements were issued to the Ministry and the dates management comments and signed accounts were received.
Ministry of Economy Head 4: Page 125 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Rating  Effective Rating  Ineffective Timeliness of Management Comments Received Within 14 days from issue of Draft Management Letter Timeliness of Signed Financial Statements Received After 15 days from issue of financial statements for signing Accordingly, we have assessed timeliness as: Rating Timeliness of Management Comments Received  Effective Within 14 days from issue of Draft Management Letter Rating  Effective Timeliness of Signed Financial Statements Received Signed financial statements received within 15 days Ministry of Economy Head 4: Page 126 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 PART C: OTHER SIGNIFICANT MATTERS The Audit Act 1969 requires, amongst other things, that the Auditor-General must report on other significant matters which the Auditor-General wishes to bring to the attention of Parliament.
Other significant matters highlighted in this report, include control weaknesses which could cause or is causing severe disruption to the process or on the ability of an auditee to achieve process objectives and comply with relevant legislation.

It is likely that these issues may have an impact on the operations of the Ministry in future, if necessary action is not taken to address them.
It is important to note that the deficiencies detailed in this report were identified during our audit and may have been subsequently resolved by the Ministry.

These have been included in this report as they impacted on the overall system of control of the Ministry as at 31 July 2018.
4.23 Trading and Manufacturing Account - Receivables Not Recorded The credit officer must maintain a debtors’ register and adhere to the debt recovery procedures in accordance with Part 9 of the Manual.24 It was noted that rent receivable totalling $1.4 million, relating to rental of government quarters l, was not recorded as receivables in the Office Accommodation TMA Balance Sheet as at 31 July 2018.

The Ministry has agreed to resolve the matter in the 2018 – 2019 agency financial statements.
Root Cause/Implication The detailed Quarters Rental Listing has not been correctly updated and maintained by the Ministry resulting in Accounts Receivables not reflected in the Balance Sheet.

Net assets for TMA – Office Accommodation was also understated by the same amount Recommendation The Ministry should ensure that the debtors’ register and listing are maintained and reconciled with the FMIS general ledger on a monthly basis.
Agreed Management Action The Ministry agrees with the comment and would like to highlight that current records are captured under the new database implemented in early 2019 under Asset Management module which captures accruals and prepayments for updated records on a timely and efficient manner.

The Unit has also discussed with FMIS team to update and reconcile the records monthly to ensure correct representation of TMA accounts.
The changes in the recording of Account Receivables for TMA operation through FMIS will be reflected from 2019 -2020 FY in the Agency FS.
24 Ministry of Economy Finance Manual 2015 Section 6.4.8 Ministry of Economy Head 4: Page 127 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Officer Responsible Manager Financial Reporting 4.24 Variance in LTA Revenue Reconciliation is an internal control activity established to ensure the accuracy of financial reports being produced not only at division level and/but most importantly at ministry level.25 The Accounts Officer must reconcile all accounts to be submitted to Chief Accountant within two weeks after the closing of each monthly account.26 The review of the Land Transport Authority (LTA) revenue noted a variance between the amount recorded in the FMIS general ledger (SRG 23) and the amount received through independent confirmation for the year ended 31 July 2018.
Refer to Table 4.17 for details.

Table 4.17: LTA Revenue vs FMIS General Ledger Particulars Balance - FMIS general ledger Balance - Confirmation from LTA Variance LTA Fees, Fines & Road User Levy Amount ($) 50,025,652 53,365,063 3,339,411 The Ministry of Economy had provided a reconciliation to explain the variance.

However, details of the LTA gross revenue of $37.6 million provided in the reconciliation could not be traced to the LTA Revenue confirmation received.
In addition, details of the variance identified as reversals, dishonoured cheques VAT and refunds were not provided for verification.

Root Cause/Implication The reconciliation process was not effectively performed to properly determine the component of the variance between the relevant records.

Recommendation The Ministry should perform monthly reconciliation for revenue with collecting agencies’ records and ensure that any variance identified are rectified.
Agreed Management Action Management noted the comments and recommendations.

Reconciliation on LTA revenue was submitted to OAG on 25/10/2019.

OAG to note that there will be variances between the LTA figures and FMIS due to the following: - LTA revenue figures provided are VIP in nature.

MoE pays VAT on behalf of LTA and is accounted in FMIS; and - LTA provides gross revenue figures whilst FMIS figures are inclusive of reversals, dishonoured cheques, and refunds.
25 Ministry of Economy Finance Manual 2015 Section 17.3.3.2.1 26 Ministry of Economy Finance Manual 2015 Section 17.3.3.2.1(i) Ministry of Economy Head 4: Page 128 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Ministry of Economy has put controls in place from 2019-2020FY whereby reconciliations for LTA revenue accounts are being performed on a monthly basis and quarterly revenue confirmation is being obtained from LTA to ensure the figures are aligned between LTA and MoE books.
Officer Responsible Manager Financial Reporting 4.25 Absence of Risk Management Policy, Strategic Plan and Operational Plan Risk management and internal control are important and integral parts of a performance management system and crucial to the achievement of outcomes.

They consist of an ongoing process designed to identify and address significant risks involved in achieving an entity’s outcomes.
A strong system of financial management is essential for the implementation of public sector policies and the achievement of intended outcomes, as it will enforce financial discipline, strategic allocation of resources, efficient service delivery, and accountability.27 The audit noted that there was no risk management framework in place.
As a result, the Ministry does not have approved written policies, procedures and guidelines to manage the risks associated with the following: • Fraud control and anti-corruption; • Disaster recovery and business continuity; and • Assessment of potential conflict of interest Root Cause/Implication The Ministry’s plans are still in draft form and awaiting approval.
Recommendation The Ministry should ensure that the Risk Management Policy is developed and Strategic Plan and Costed Operational Plans are properly approved.

Agreed Management Action Management notes the comments and recommendations.

The existing policies and guidelines for the Ministry and the overall civil service is adequate to mitigate and manage the risks identified above.

However, the Ministry will give due consideration on the recommendation for the Risk Management Policy.
The Strategic Plan and the Costed Operational Plan has been drafted and was submitted for final endorsement.
Officer Responsible Manager Financial Reporting 27 International Framework: Good Governance in Public Sector IFAC & CIPFA 2014 section F pg27 (https://www.ifac.org/system/files/publications/files/International-Framework-Good-Governance-in-the- Public-Sector-IFAC-CIPFA.pdf) Ministry of Economy Head 4: Page 129 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 4.26 Arrears of Revenue Not Recorded Each agency must maintain a Debtors Register within the FMIS or an accounts receivable ledger for licenses, debts, court fees and other State or agency revenues receivable.28 A former employee of the Ministry owed Government a sum of $10,415 upon retirement.
According to the Recovery of Debt Agreement, the obligor acknowledged the debt of overpayment of salary and agreed to repay the sum fully upon receiving FNPF pension.

It was noted that the amount of $10,415 was not recorded in the Arrears of Revenue Report for 2018.

The Officer retired under medical grounds on 18 June 2018.

Root Cause/Implication The failure to record the arrears of revenue has led to the understatement of the arrears of revenue for the year ended 31 July 2018.
Recommendation The Ministry should ensure that unrecorded arrears of revenue is included in the Ministry’s Arrears of Revenue Report and recover the revenue in accordance with the measures specified in Finance Manual.

Agreed Management Action Management noted comments and recommendation.

Officer Responsible Manager Financial Reporting 4.27 Administration of Environmental and Climate Adaption Levy The Environmental Levy (Budget Amendment) Act 2017 establishes the Environment and Climate Adaptation Fund.
The Fund shall consist of any money paid to the Fiji Revenue and Customs Service in relation to the Environment and Climate Levy imposed under this Act.29 The purposes of the Fund are to promote conservation for the forests, flora, fauna, wildlife, ecosystems and biodiversity of Fiji; provide funding to assist programmes, projects and activities associated with climate change mitigation and adaptation activities: and engage in any environment or climate change related activity approved by the Minister.30 To allocate ECAL funds to the relevant programs and projects associated with climate change mitigation and adaptation, the Ministry apportioned the funds to the projects at a rate of 60% of the project costs.
The audit noted that the method of apportioning costs to the projects have not been appropriately approved or documented.
28 Finance instruction 2010 Section 40 29 Environmental Levy (Budget Amendment) Act 2017 Section 12 (i)(ii) 30 Environmental Levy (Budget Amendment) Act 2017 Section 13 (a) (b) (c) Ministry of Economy Head 4: Page 130 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Root Cause/Implication An approved documented procedure will ensure consistency in the assigning of project costs to the ECAL funds.
Recommendation The Ministry should expedite the finalisation of its Standard Operating Procedure for the International Cooperation and Climate Change Unit.
Agreed Management Action In the absence, of any international set criteria for apportioning climate change costs to climate centric projects and the inherent cost tracking limitations of the current FMIS system, the Ministry used its judgement through technical experts based with the Climate Change and International Cooperation Division to apportion at a rate of 60% of the total project as climate relevant expenditure.
With the introduction of the above mentioned Climate Budget Tagging, this can be easily resolved.

Officer Responsible Manager Financial Reporting 4.28 Presentation of Main Trust Fund Account - Recurring Issue Each agency must include the following statements in its annual financial statements- a trust account statement of receipts and payments (where applicable).31 There were ten (10) Main Trust Fund accounts held by the Ministry in 2018.
It was noted that the opening and closing balances of these ten (10) main trust fund accounts were consolidated into one statement.

The receipts and payments during the year for the respective trust fund accounts were not shown separately but reflected in one statement of trust fund account.

Table 4.18: Main Trust Fund Accounts No.
Main Trust Fund Account Performance Bond Government Tuna Stabilisation Fund Prime Minister's National Disaster Relief and Rehabilitation Cyclone Winston Group Insurance Trust Miscellaneous Fund vs Others ODA Performance and Tenancy Bond Adopt A School COP 23 Trust Fund Accident Compensation Fund EU Grant Assistance 31 Finance Instruction 2010 Section 71(1) Ministry of Economy Head 4: Page 131 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Root Cause/Implication The current presentation limits the usefulness of financial statement as users will not be able to determine the opening and closing balances for each Main Trust Fund account and the movements during the year.
Recommendation The Ministry should prepare separate statements for each main trust fund account held and consider reflecting the nature or types of receipts and payments in the Trust Fund Account’s Statement of Receipts and Payments.
Agreed Management Action Ministry of Economy will provide separate presentation of statement of receipts and payments for Trust Fund Account as initially from 2019-2020FY Officer Responsible Manager Financial Reporting 4.29 Delay in Finalisation of Financial Statements - Recurring Issue Each agency must prepare an annual report for submission to its Minister by 31 December in the following year.32 Each annual report must include financial statements which are prepared and signed in accordance with these instructions, audited by the Auditor-General and accompanied by the audit opinion provided by the Auditor General.33 The delay in the finalisation of the audit for Ministry of Economy was due to the following: • • • • • • • Amendments were made to the Agency Financial Statements on 18 December 2018.
The 2nd draft was received on 12 June 2020 and the 3rd draft was received on 11 August 2020 and the final revised accounts was received on 25 August 2020.

The Ministry continued to make adjustments with the posting of journals to the FMIS general ledger during the audit conduct.34 Drawings account was finalised on 4 September 2018 after the due date of 29 August 2018 Stale cheques were reflected in Drawings Account for Pension Section.
Retirement of Imprest Account was completed on 6 August 2018 (Journal ID: 04F057) after the due date of 20 July 2018.

Virements were processed until 14 September 2018 when the due date was 20 July.

Balances in AFS submitted were not reconciled with FMIS general ledger and FRCS records.

Refer to Appendix 1 for details of the amendments.
32 Finance (Amendment) Instruction 2016 Section 69 33 Finance Instruction 2010 Section 70(2) 34 Journal ID:04A087 on 22 October 2018 and journal ID FAM325 on 8 October amounting to $1.8 million Ministry of Economy Head 4: Page 132 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Root Cause/Implication The continuous amendments in the draft financial statements after its submission to the Office of the Auditor-General is an indication of the quality of the financial statements submitted.
This has resulted in the delay of the finalisation of the audit.

Recommendation The Ministry should ensure that the draft financial statements prepared by the Ministry are verified by the Financial Reporting Section for accuracy before submission for audit and that the due dates for closing of accounts circular are complied with.

Agreed Management Action No agreed timeline was discussed between Office of Auditor General and Ministry of Economy regarding the conduct of MoE audit for 2017-2018FY.
In addition, auditors were not present on a daily basis to conduct audit and OAG should have considered Government's closing of accounts period which is usually a busy period whereby Ministries / Departments send in their payment requests.

Treasury comprises of 7 departments and auditors were working from Financial Operation section which usually has space constraints due to the nature of its operation.
We propose a clear timeline is agreed in the future with due consideration and understanding of each other’s challenges.

Requesting OAG to provide a detail listing of the unprocessed PO’s for Management comments.

Virement V04007 was approved and processed late.

FMIS is working very closely with Budget and Planning Division to ensure all virement applications are approved and processed in a timely manner.
Officer Responsible Manager Financial Reporting Ministry of Economy Head 4: Page 133 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 FINANCIAL STATEMENTS OF GOVERNMENT 4.30 Internal Control Weaknesses for Ministries and Departments Each agency must have in place a cost effective system of internal controls which safeguards money and property against loss, avoids or detects accounting errors and avoids unfavourable audit reports.35 An annual board of survey must be conducted each year to verify the existence and condition of assets recorded on the asset register provided that, for agencies that have, in the opinion of the Permanent Secretary a large asset base, the board of survey to be conducted on a cyclical basis so that all assets are checked every three years.36 The audit noted that internal controls were generally found to be weak in the following agencies: • Department of Immigration; • Ministry of Employment, Productivity and Industrial Relations; • Fiji Police Force; • Ministry of Foreign Affairs; • Fiji Corrections Service; • Ministry of Disaster Management and Meteorological Services; • Ministry of Education, Heritage & Arts; • Ministry of Health & Medical Services; • Ministry of Women, Children and Poverty Alleviation; • Ministry of Agriculture; • Department of Housing; • Ministry of Fisheries; and • Ministry of Forestry.
Refer to Appendix 2 for details.

In addition, the board of survey for the following agencies were not carried out for the financial year 31 July 2018: • Peacekeeping Missions; • Ministry of Waterways; • Ministry of Disaster Management and Meteorological Services; and • Department of Housing Implication Failure to strengthen internal controls may result in material misstatements and possible financial losses in the future.
Material misstatements at Ministry level will impact on the audit report for the financial statements of Government.
35 Finance Instructions 2010, Section 59 (1) 36 Finance Instructions 2010, Section 49 (1) Ministry of Economy Head 4: Page 134 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Recommendations Ministries and Departments should: • regularly evaluate its internal controls to determine its effectiveness and identification of weaknesses so that corrective action can be taken and; • ensure that Board of Survey is carried out annually as required under the Finance Instructions section 49.
Agreed Management Action The Accounting Head of Agency is responsible to the Permanent Secretary for the effective design and operation of internal controls across the agency Thus, the Permanent Secretaries for the Government Ministries/Departments are responsible for the audit matters related to their agencies and as enshrined in the 2013 Constitution of the Republic of Fiji, section 127.

Hence, the audit matters of agencies is not proper to be placed on MoE.
MoE through the Monitoring & Evaluation department have been highlighting anomalies identified during the reconciliation review process to the respective Accounting Heads and Permanent Secretaries.

Further, in MoE roles and responsibilities, we are placing the behavior of highest accountability wherever we can but cannot look into the finer processing of transactional issues of respective agencies.
These are responsibilities of the respective Head of Agencies and is fair to report with the line Ministries.

Officer Responsible Accounting Head of respective agencies.

4.31 Variance in Payroll An unreconciled variance of $9,619,471 exists between FMIS general ledger and the Ministry’s Payroll Report for both Established Staff and Government Wage Earner.

Refer to Table 4.19 below for variances in the respective Ministries.
Table 4.19: Unreconciled variance - Payroll Ministry Environment – SEG 1 Environment – SEG 2 Fisheries Forestry Education Health – SEG 1 Health – SEG 2 TOTAL Unreconciled Amounts ($) 469,718 (353,890) 1,727,621 850,831 5,655,806 928,833 340,521 9,619,440 Ministry of Economy Head 4: Page 135 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Root Cause/Implication Lack of reconciliation between the FMIS and payroll report has resulted in the variances.
Variances between critical records may indicate the existence of errors and omissions and may result in ministries failing to detect possible irregularities in the payment of salaries in a timely manner.

Recommendation Ministries and departments should regularly reconcile FMIS general ledger to the Payroll Report.

Any variance noted should be investigated and adjusted accordingly.
Agreed Management Action Payroll and FMIS are two separate systems that do not communicate with each other and variance between the two systems are mainly due to the following: • The manual payments and salary reversals are processed in FMIS and these payments are not reflected in payroll.

• Officers who are not on the payroll ([i.e.

NEC volunteers) are directly paid via FMIS.

• • Project Officers are paid from Seg 1 and later adjustments are made to Seg 7, 8, 9 and 10.
Project Officers whose salary are funded by donor agencies are paid from payroll and later these charges are adjusted to correct GL in FMIS.

The line agencies are responsible to carry out its GL reconciliation and ensure that necessary adjustments are made to salary components of its staffs.
Officer Responsible Respective Ministries 4.32 Annual Report on Whole of Government The Minister must table in Parliament a whole of Government annual report for the each financial year.37 The annual report for the financial year must include: (a) The whole of government financial statements referred to in section 46; (b) The annual appropriation statement referred to in section 47; and (c) The annual budget statement referred to in section 48.38 The audit noted that Ministry of Economy has not tabled in Parliament the Whole of Government annual report for the financial years ended 31 July 2016 and 31 July 2017.
Comments provided by the Ministry in 2017 was that the annual financial statement are prepared by the Ministry of Economy and do not form part of the report of the Auditor-General.
37 Financial Management Act 2004, Section 45 (1) 38 Financial Management Act 2004, Section 45 (3) Ministry of Economy Head 4: Page 136 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Root Cause/Implication The Ministry has not complied with Section 45 of the Financial Management Act 2004 when the annual report is not tabled in Parliament.

Recommendations The Ministry of Economy must ensure to table in Parliament the whole of Government annual report in a timely manner.
The Auditor-General’s report to Parliament should not be taken as the whole of Government annual report.

Agreed Management Action Management noted comments and recommendations.

Officer Responsible Manager Financial Reporting 4.33 Ageing Reports not maintained for VAT & Income Tax Refunds Outstanding Accounts payable balance of $164,938,055 include VAT & Income Tax Refunds Outstanding of $164,249,266, which is 99.5% of the balance.
The audit noted that FRCS did not maintain the ageing reports for Income Tax and VAT refunds outstanding as at 31 July 2018.

The FRCS explained that there is no systematic way currently in place where the age of refunds is extracted and recorded.

The Fiji Integrated Tax Systems (FITS) maintain timelines for each refund case, which is compiled manually.

Root Cause/Implication The absence of ageing reports for accounts payable limits the ability of government to keep track of long outstanding dues.
Recommendation The Ministry should require that the FRCS maintains and submits aging reports for Income Tax and VAT Refund outstanding to assist in identifying long outstanding payables of Government.

Agreed Management Action Ministry of Economy will liaise with FRCS as per the recommendation.
This will be implemented during FY 2020- 2021 as the audit has lapsed by 2 years Ministry of Economy Head 4: Page 137 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Officer Responsible Manager Financial Reporting 4.34 Implementation of Activities proposed in the PFTAC Report The Ministry of Economy requested technical assistance from PFTAC to develop of a framework for identifying, assessing, and reporting of fiscal risks arising from public enterprises (PEs) and statutory authorities (SAs).
The technical assistance also looked at institutional arrangements to strengthen fiscal oversight of these entities.39 The PFTAC report published in June 2017 proposed the following: i) a framework for identifying, estimating, and reporting of fiscal risks arising from PEs/SAs (Section III); and (ii) strategies to strengthen institutional frameworks for fiscal oversight of PEs/SAs (Section IV).

Audit noted that the following activities in the PFTAC report have not been implemented by the Ministry.
Please refer to Appendix 3 for details: Root Cause/Implication Government would not have fully gained value from the taken technical assistance offered when it fails to implement the proposals.

Recommendation The Ministry of Economy should ensure that proposed plans outlined in the report are implemented.

Agreed Management Action Management noted comments and recommendations.
The Ministry has recently completed a Public Expenditure and Financial Accountability Assessment (PEFA) and is working on a Public Financial Management Improvement Plan (PFMIP) which will include reform actions to strengthen fiscal management.

This will guide overall public finance management reforms.
Officer Responsible Manager Financial Reporting 4.35 Delay in finalization of the Financial Statements of Government The Minister must table in Parliament a whole of Government annual report for the each financial year.40 The annual report for the financial year must include: 39 IMF PFTAC Report – Fiji: Strengthening Fiscal Oversight of Public Enterprises (PEs) and Statutory Authorities(SAs) June 2017 40 Financial Management Act 2004, Section 45 (1) Ministry of Economy Head 4: Page 138 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 (a) The whole of government financial statements referred to in section 46; (b) The annual appropriation statement referred to in section 47; and (c) The annual budget statement referred to in section 48.41 The delay in finalization of the financial statements of Government were due to the following: 1) Delay in receiving the initial draft financial statements of Government.
The first draft financial statements was received on 29 November 2019.

2) There was also the delays in provision of records.

Refer to Appendix 4 for details.

3) Amendments to the draft financial statements due to errors identified during the audit: • • 2nd draft accounts was received on 26 June 2020.

3rd draft accounts was received on 07 August 2020.

Other amendments were also made via email after 07 August 2020.

Refer to Appendix 4 for details.


• Significant audit adjustments were processed due to material anomalies noted during the audit of the financial statements for 2017/2018 financial year.

The last audit adjustment was processed by the Ministry (FMIS) on 03 June 2020.

Refer to Appendix 5 for the details of the audit adjustments processed.
• Additional audit work carried out as a result of the Ministry’s decision to resolve issues raised in the draft Auditor’s Report in relation to Accident Compensation Fund adjustment of $1,029,528 (Appendix 1) and TMA Office Accommodation.

Root Cause/Implication Delay in finalizing the FSG will Auditor General’s report to Parliament.

Recommendations Ministry of Economy should ensure that correct set of financial statements are submitted for audit purposes.
Ministry of Economy must emphasize to respective heads of Ministries and Department to be mindful of the significant audit issues and take corrective action to avoid any delays in finalizing the audit.

Agreed Management Action Noted.

MoE has been advising the same to the Ministries and Department via Closing of Account Circular and monthly Permanent Secretaries dashboard.

Further, MoE and OAG will need to work together as ‘way forward’ to enhance the audit process.
Officer Responsible Manager Financial Reporting 41 Financial Management Act 2004, Section 45 (3) Ministry of Economy Head 4: Page 139 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 TRUST FUND ACCOUNT 4.36 Main Trust Fund Account Public money means revenue or money raised or received for the purposes of government.
Trust money means money held by a budget sector agency on trust, other than public money.42 Trust money is to be accounted for separately from public money and other money.43 Trust monies are money held by one party on behalf of another.44 As at 31 July 2018, the Consolidated Trust Fund Account had a balance of $161,241,215.

The audit noted that certain Trust Fund Accounts do not operate as a trust and should be included in the budgetary process.

Refer to the list below for examples.
• Ministry of Health – Cardiology Services • Ministry of Women, Children & Poverty Alleviation – Help for Home Trust • Ministry of Communication - Telecommunication Trust Fund Account • Ministry of Infrastructure and Transport - Rural Electrification Trust • Office of the Attorney General - Solicitor General Trust Account – Transfer from SLG 84 • Ministry of Employment: ➢ National OHS Education and Accident Prevention - OHS Trust Fund ➢ OHS Consultancy Services, Workmen’s Compensation and Wages Dispute Trust Fund Account.
Root Cause/Implication Lack of review on the Main Trust Fund Account can lead to funds being held up in Trust Accounts.

When public money that fund operating and capital expenditures of government are held in trust, the utilization of these funds do not go through the budget approval process.
Recommendation The Ministry should: • • review all the Main Trust Fund Accounts to determine the ones that do not meet the Trust definition; consider including in the budgetary process the operations of these accounts.

• also review the Trust Fund Accounts to determine if the reasons for which the Trust Fund Accounts were opened are still applicable and fund deposited are for specific purposes.
Agreed Management Action We again wish to bring to the attention of the Office of Auditor General (OAG) section 127 of the 2013 constitution of the Republic of Fiji, specifically, subsections 2, 3 and 7.
We request that OAG address these 42 Financial Management Act 2004, Section 2 43 Financial Management Act 2004, Section 25 (1) 44 Finance Circular No.2/2013 Ministry of Economy Head 4: Page 140 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 matters at Agency level with parties that are directly responsible as audit matters raised relates to their accounts.

Some of the trust fund accounts were opened light of the regulations/act.
For example; the in Telecommunication Promulgation and the Telecommunications (Trust Fund) Regulations 2016 established the Trust Fund Account for the purpose of imposing a levy on the interconnections to fund national developments in telecommunication such as Telecentres and the Digital Television expenditures.

Whilst, Help for Home Trust was opened in accordance with the HFH Trust Account Financial Policy guideline.
Further, MoE upon discussion with respective Ministry/Department have noted that Solicitor General Trust Account was opened in line with the recommendation provided by the OAG.

MoE will embark on a comprehensive review of all trust fund accounts to determine eligible trust accounts.

MoE will also set up a list of criteria’s to ensure better understanding of the current trust funds and its existence.
Officer Responsible Manager Financial Reporting 4.37 Detailed Listing not maintained for Main Trust Fund Account The names and balances of each account must be listed and the reconciliation shall be signed by the responsible officer.
Unreconciled items must be investigated and resolved promptly.45 The audit noted that there was no listing of claimants for monies held in trust totalling $78,371,798 Refer to Table 4.20 below for details: Table 4.20: Monies Held in Trust – No Listing of Claimants Maintained Ministries/Departments Description Judiciary Fisheries Lands and Mineral Resources Infrastructure and Transport Rural and Maritime Development Department of Immigration Ministry of Environment Suitors Trust Fund Account Sundries Trust Fund Account Maintenance Fund Trust Account Fisheries 1/3 Subsidy Scheme Trust Fund Account Lands Trust Fund Account Energy Trust Account PM Relief & Rehab Committee 1/3rd Contribution - Self Help Immigration Bond Trust Fund Account Environment Trust Fund Account Total Amount ($) 24,264,070 5,545,577 1,739,890 261,684 6,614,870 2,445,195 1,173,893 553,611 28,724,628 7,048,380 78,371,798 45 Finance Instruction 2010, Section 58(3) Ministry of Economy Head 4: Page 141 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Root Cause/Implication As such, the audit could not ascertain the accuracy and completeness of the Consolidated Trust Fund Account balance of $197,701,126 as at 31 July 2018.
This issue was also included as an Emphasis of Matter paragraph in the audit reports for the year ended 31 July 2017 and 31 July 2016.

The respective Ministries have agreed to the recommendations provided in their management letters.

Recommendation Ministries/Departments should ensure that detailed listings of claimants of the monies held in Main trust are maintained.
The FMIS Division should ensure that Ministries/Departments are submitting the detailed listing of claimants of the monies held in trust in its monthly reconciliation.

Agreed Management Action Management noted comments and recommendations.

MoE will continue to remind and have meetings with the concerned Ministry/Department through training sessions and meetings held.
Ministries/Departments are constantly advised to ensure that their processes are aligned to the Finance Manuals Financial Instructions 2010 and Finance Management Act 2004.

Officer Responsible Manager Financial Reporting 4.38 Variances in Main Trust Accounts Each month, the trust account must be balanced and reconciled with the trust bank account.
Un- reconciled items must be investigated and resolved promptly.46 The audit noted a variance of $191,016 between Trust Fund Cash and the Trust Fund Liability as at 31 July 2018.

Refer to Table 4.22 for details.

Table 4.22: Variance in Main Trust Account Account Name Account No.
Amount ($) Trust Fund Cash 9-00000-00000-520000 161,050,199 Trust Fund Liability 9-00000-00000-890000 (161,241,215) Variance (191,016) 46 Finance Instructions 2010, Section 58 (3) Ministry of Economy Head 4: Page 142 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 A variance of $1.

3 million was noted as at 31 July 2017.

Root Cause/Implication The above indicates the lack of adequate reviews by the FMIS Division on the reconciliations submitted by the Ministries/Departments.
Recommendation The Ministry of Economy’s FMIS Division should identify those variances and take corrective actions in consultation with the respective ministries/departments.

Agreed Management Action Management noted comments and recommendations.

OAG to note that the variances mentioned are legacy issues.

We request that OAG address these matters at Agency level with parties that are directly responsible as audit matters raised relate to their accounts.
Further improvement has been made as the balance has reduced from prior year, Monitoring & Evaluation Unit at MoE consistently liaise with respective Accounting Heads in identifying these balances and taking corrective measures.

Officer Responsible Manager Financial Reporting 4.39 Reconciliations not prepared for Main Trust Fund Account – Judicial Each month, the trust account must be balanced and reconciled with the trust bank account.
Un- reconciled items must be investigated and resolved promptly.47 The Department maintains Judicial Trust Fund Account which consists of three trust fund accounts: Suitor’s Trust, Maintenance Trust and Sundries Trust accounts.

The audit of the Trust accounts noted that the trust liability reconciliations were significantly delayed.

o For Suitors Trust Fund account, Suva Suitors Trust reconciliation were prepared up to February 2017.
Lautoka Suitors up to December 2007 while the Labasa reconciliation has been prepared up to September 2009. o For Sundries trust reconciliations, the current Sundries Trust reconciliations were completed up to 2016 while the backlog Sundries Trust reconciliations were completed up to 1995 for stations.

o For Maintenance Trust, the current maintenance Trust reconciliations were prepared up to 2016, while the backlog reconciliations were completed p to 1995 for 11 stations.
47 Finance Instructions 2010, Section 58 (3) Ministry of Economy Head 4: Page 143 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 In 2017, the Judicial Department’s reconciliations for Suitors, Sundries and Maintenance Trust Fund were only prepared up to January 2015, January 2000 and December 1994 respectively.

Root Cause/Implication The backlog was mainly due to the lack of monitoring and controls in place and the lack of scrutiny from the Ministry of Economy.
The unresolved variance also indicates the lack of coordination between the Department and the Ministry of Economy.

In the absence of proper reconciliations, the correctness of the balance reflected in the Judicial Trust Fund accounts cannot be ascertained.

Recommendation The Ministry of Economy should liaise and assist the Judicial Department to ensure that reconciliation of the trust accounts are updated.

Agreed Management Action Management noted comments and recommendations.
This is a legacy issue and the Department has put in place measures to progress with the reconciliation.

We suggest that OAG includes this update in the report in consultation with Judicial Department.
Officer Responsible Manager Financial Reporting 4.40 Significant Outstanding Operating Trust Fund Balance Each agency must have in place a cost effective system of internal controls which avoids or detects accounting errors.48 The Operating Trust Fund account had a credit balance of $36.4 million as at 31 July 2018.

The audit noted that this included significant outstanding balances amounting to $4.6 million or 13% carried forward from prior years without any or minimal movements during the year.
Refer to the Table 4.23 below for details.
Table 4.23: Significant Operating Trust Fund Balance Ministry Head 31 July 2018 ($) 31 July 2017 ($) 1-08101-08101- 861902 1-08101-08101- 861910 204 PD Deposit Account Recoverable (23,920.00) (24,901.70) 383 PD Sundries (212,072.61) (212,072.61) 48 Finance Instructions 2010, Section 59 (1)(b) Ministry of Economy Head 4: Page 144 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Ministry Head 31 July 2018 ($) 31 July 2017 ($) 1-08101-08101- 861920 1-08103-80101- 863101 1-08103-80102- 863101 1-08103-80201- 863101 1-08103-80401- 863101 1-08103-80701- 863101 1-08103-81001- 863101 1-08103-81102- 863101 1-08101-08101- 864102 108101-08101- 864199 1-19101-19999- 861920 1-20101-20101- 861210 1-20101-20101- 861517 1-20101-20101- 861917 1-20101-20101- 861920 1-20101-20101- 863201 501 PD Employees FNPF (487,823.65) (475,893.86) Administration Contributions Foreign Mission Administration Contributions Foreign Mission Administration Contributions Foreign Mission Administration Contributions Foreign Mission Administration Contributions Foreign Mission Administration Contributions Foreign Mission Administration Contributions Foreign Mission Sundries (238,444.54) (239,444.54) (330,157.99) (330,157.99) (49,269.33) (49,269.33) (3,261.14) (3,261.14) (131,018.25) (131,018.25) (23,961.59) (23,961.59) 8,100.51 (8,100.51) (18,795.34) (18,795.34) PSC Cuba Scholarship (1,703.92) (1,703.92) 501 PD Employees FNPF (801,703.42) (763,696.99) Police Welfare Scheme (212,241.43) (67,598.04) Police Service Credit Union (654,416.76) (799,034.76) Improved Forestry (285,440.60) (97,755.08) Employees FNPF (155,720.76) (4,180.31) VAT from provision of goods and services Total (4,633,731.93) (995,680.09) (1,000,753.80) Root Cause/Implication The anomaly indicates ineffective internal control and supervision which is a non-compliance issue with procedures in the Finance Instructions.
This will result in the accumulation of liabilities of Government.

Recommendation The Ministry of Economy’s FMIS Division should identify those carried forward and dormant account balances from Ministry and Departments’ reconciliations and take corrective actions in consultation with the respective ministries/department concerned.

Agreed Management Action Management noted comments and recommendation.
Ministry of Economy Head 4: Page 145 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 OAG to note that these are legacy issues that the Ministries are committed to resolving.

OAG should note and appreciate the progress respective Ministries have made to resolve those legacy matters and assess its conclusion on the audit results accordingly.
MoE through its Monitoring & Evaluation Unit is reviewing these trust accounts and liaising with respective Ministries/Departments on the need continue the operation of these trust fund accounts.
Officer Responsible Manager Financial Reporting CASH 4.41 Variances between FMIS General Ledger and Bank Reconciliations The review of Cash and cash equivalent held by the government revealed an unreconciled variance of $1.1 million between the FMIS general ledger balance of $61.3 million and the bank reconciliation statement of $60.2 million.

The variance was the sum of the consolidated variances in cash accounts for TMA, Trust Fund accounts and overseas cash accounts.
Refer to the Table 4.24 below for details.
Table 4.24: Variance – FMIS GL and Bank Reconciliation Statement Description of Account Overseas Accounts – Ministry of Foreign Affairs Trading and Manufacturing Account Trust Fund Accounts Overseas Account - Ministry of Economy Total Variance FMIS Balance ($) 7,208,398 5,516,252 48,687,447 (138,686) 61,273,411 Bank Reconciliation ($) Variance ($) 3,725,421 3,482,977 4,540,957 975,295 51,635,536 249,151 60,151,065 (2,948,089) (387,837) 1,122,346 In addition, the audit also noted that two (2) Term Deposit Accounts totalling $3.6 million were recorded under Cash in the financial statements.
The audit noted that bank reconciliations statements were not provided for audit verification.

Refer to the Table 4.25 below for details.
Table 4.24: Bank Reconciliation Statements not Provided FMIS GL Allocation Account Description 2018 ($) 2017 ($) Movements ($) 10410204202520103 RBF Special Account IBRD 3188 13010298765520301 FAPP Operating Account 13010130999520301 WBC Suva 10410404402526301 Fixed Term Deposit Westpac 10410404402526302 Fixed Term Deposit Westpac 10210102999520701 OPM -HFC Cash Account 10410204354520710 TELS Recovery HFC Ministry of Economy 49,764.29 503,421.82 (4.20) (4.20) 2,500,000.00 2,500,000.00 1,059,669.66 1,059,669.66 --- 49,764.29 39,243.31 464,178.51 --- --- --- 881.25 5,818,901.40 (5,818,020.15) --- 2,956,661.76 2,956,661.76 Head 4: Page 146 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 FMIS GL Allocation Account Description 10410204202525201 RBC General 10410204201520201 ANZ-Suva Root Cause/Implication 2017 ($) Movements ($) 2018 ($) 626,550.92 44,841.12 --- 24,236.77 7,741,786.62 10,114,729.73 (2,397,179.88) 626,550.92 20,604.35 The finding indicates the lack of monitoring of bank reconciliations carried out at by the respective Ministries responsible for the cash accounts.
This has resulted in the misstatement of cash and cash equivalent by $1,122,346.

A reason provided for bank reconciliations not prepared was that there were no movements in certain cash general ledger accounts.

As a result, there is a risk that movement in the bank accounts may not be correctly reflected in the general ledgers and the financial statements.
Recommendations The Ministries holding cash accounts should: • ensure that the FMIS general ledger is reconciled on a monthly basis and any variances are investigated and resolved; and • ensure that Term Deposits Accounts are correctly recorded in FMIS general ledger.

The Ministry should prepare bank reconciliations despite no movements in the ledger accounts as bank fees and interest are charged on monthly basis.

Movements in the bank accounts will need to be accounted for in the general ledger.
Agreed Management Action Management noted comments and recommendation.

Ministry of Economy (MOE) through the Monitoring & Evaluation Unit reviews all reconciliations submitted by the respective Ministries/Departments.

Further follows ups and meetings are convened to address such issues.
However, we also wish to bring to the attention of the Office of Auditor General (OAG) that under section 127 of the 2013 Constitution of the Republic of Fiji and as per section 7 of the Financial Management Act 2004, the respective Permanent Secretaries and Heads of Agencies are responsible for managing the financial affairs of their Ministries/Department.

We request that OAG address these matters at Agency level with parties that are directly responsible as audit matters raised relates to their accounts.
Term Deposit Account was recorded under Cash as it did not fit the classification of the activate chart of accounts at the time.

Moving forward, FMIS will ensure SAG 76 is activated to record such investment.

Management noted comments and recommendation.


However, we again wish to bring to the attention of the Office of Auditor General (OAG) that under section 127 of the 2013 constitution of the Republic of Fiji and as per section 7 of the Financial Management Act 2004, the respective Permanent Secretaries and Heads of Agencies are responsible for managing the financial affairs of their Ministry/Department.
We request that OAG address these matters at Agency level with parties that are directly responsible as audit matters raised relates to their accounts.
Ministry of Economy Head 4: Page 147 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Officer Responsible Manager Financial Reporting 4.42 Overseas bank accounts not reported at Closing Rate Cash balances held in a foreign currency shall be translated using the closing rate.49 Closing rate is the spot exchange rate at the reporting date.50 The audit noted that the overseas bank accounts balance of $19.5 million was not translated using the spot rate at year end.
The closing balances were converted using the monthly exchanges rates released by Ministry of Economy.

Root Cause/Implication The above is a departure from the IPSAS Reporting under Cash Basis of Accounting standards.

As a result, the balance for overseas bank accounts are not correctly reflected in the financial statements and the effect of exchange rate changes on cash held in foreign currency are not correctly accounted for.
Recommendation The Ministry should ensure that Overseas Bank Accounts are converted at 31 July on the spot rate as required by the standards.

Agreed Management Action Management noted comments and recommendation.

MoE has advised all Accounting Heads on the treatment of foreign currency as per section 1.6 of Cash Basis of International Public Sector Accounting Standards (IPSAS) 2017.
This will be thoroughly monitored through the Monitoring & Evaluation Unit and any variance discrepancies will be highlighted to the respective Accounting Head of the line Ministry/Department.
However, we also wish to bring to the attention of the Office of Auditor-General (OAG) that under section 127 of the 2013 Constitution of the Republic of Fiji and as per section 7 of the Financial Management Act 2004, the respective Permanent Secretaries and Heads of Agencies are responsible for managing the financial affairs of their Ministries/Department.

We request that OAG address these matters at Agency level with parties that are directly responsible as audit matters raised relates to their accounts.
Officer Responsible Manager Financial Reporting 49 IPSAS 2017, Part 1.6.3 50 IPSAS 2017, Part 2.1.1 Ministry of Economy Head 4: Page 148 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 BORROWINGS 4.43 Debt Unit Internal Control Assessment There should be a public debt management strategy in place that specifies the objectives of public debt management and takes account of inherent risks.
This should be complemented by cost effective cash management policies to enable the authorities to meet with a high degree of certainty their financial obligations as they fall due.51 The audit noted the following control environment weaknesses in the Debt Management Unit: • • the Debt Unit Standard Operating Procedures from 2014 is still in draft stage and has not been approved; and the Ministry does not have a Debt Management Strategy.
Root Cause/Implication The absence of a Debt Management Strategy and an approved SOP, indicate that proper guidelines are not in place to ensure that government effectively manages its debt levels and that costs and risks of borrowings are minimised in the long term.

Recommendation The Ministry should: consider establishing a formal debt management strategy; and • • ensure that its SOP if formalised.
Agreed Management Action The Ministry has a broad debt policy which outlines the key objectives of debt management in the medium term.

This is published annually as part of the Annual Budget Supplement with the latest outlined in the 2019/2020 budget supplement.

The formulation of a Medium Term Debt Strategy is earmarked for completion by the end of 2020/2021 financial year which will be undertaken with the technical assistance from multilateral development partners.
In relation to the Standard Operating Procedure (SOP), a comprehensive and updated SOP will also be formulated and finalized by the end of the 2020/2021 financial year.

Officer Responsible Manager Financial Reporting 4.44 Undrawn Borrowing Facilities Note 14 of the Financial Statements discloses details of undrawn borrowing facilities.

Included in the undrawn loans are: • ADB Loan No.


3210-FIJ 51 International Standards of Supreme Audit Institutions 5440, Part 1 Ministry of Economy Head 4: Page 149 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 • World Bank – WB Loan No.

8482-FIJ The audit of the project that was to be funded by the two loans resulted in a qualified auditor’s report.
The basis for the qualified audit opinion was that the implementing agency did not comply with the ADB Procurement Guidelines for Contract Number FRA/TIISP/16-01 Suva Arterial Roads Upgrading Project (SARUP 1).

Refer below for the extract of the Audit Opinion for the Transport Infrastructure Investment project.

Root Cause/Implication ADB and World Bank determined this as a misprocurement and did not agree to fund the project.
As a result the Government of Fiji will incur the full cost of the project totalling $30,429,323 VIP.

The remaining balance of the project is $20,413,451.

Recommendation Implementing agencies should ensure compliance with procurement guidelines in the loan agreements.

Agreed Management Action Management noted comments and recommendation.

Ministry of Economy (MoE) will continue to emphasize to all implementing agencies the importance of compliance to the relevant legislations, guidelines and policies.
We also bring to the attention of the Office of Auditor General (OAG) section 127 of the 2013 Constitution of the Republic of Fiji, specifically, subsections 2, 3 and 7.

We request that OAG also address these matters at Agency level with parties that are directly responsible as audit matters raised relates to their accounts.
Officer Responsible Manager Financial Reporting Ministry of Economy Head 4: Page 150 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 4.45 Accounting for Green Bond Fund From December 2017 to July 2018, a total of $100 million in payments were made out of the Green Bond bank account to finance eligible green projects, which include: • Reducing Emissions from Deforestation and Forest Degradation (REDD plus) (Ministry of Forestry) • Construction of Naboro Landfill - Stage 2 (Ministry of Environment) • SHS New Installations (Under Rural Electrification Programme) (Department of Energy) • Emergency Works (Fiji Roads Authority) • Rural Water Supply Programme (WAF) • Rainwater Harvesting Systems – Government to Reimburse 70% for Residential Households (WAF) • Ongoing Rehabilitation and Construction of Schools Damaged by TC Winston (R3 - R5)(Ministry of Economy) The Ministry was apportioning the Green Bond funds to the projects at a rate of 77% to 100% of the costs incurred at the end of every month.
The audit noted that the method of apportioning of costs was done without an approved documented procedure or basis.

Furthermore, it was noted that the balances from FMIS GL balances were used to match the transfers from the Green Bond bank account, however, these balances contained misallocations and errors (negative expenditures).

Root Cause/Implication The Green Bond fund was transferred from the bank account to the Consolidated Fund account on reimbursement basis.
The process followed by the Ministry was that the Treasury Unit would make the transfers and the Climate Change and International Cooperation (CCIC) Unit would then match the transferred amounts to the expenditures already paid.
A contributing factor also to the issue above is the lack of a clear and approved procedure to determine how much of the eligible project is funded from Green Bond proceeds Recommendation The Ministry should ensure that: • • a clear approved process is in place for the utilisation of Green Bond proceeds; and requests for transfer of cash from the Green Bond bank account is initiated by the CCIC Unit to the Treasury Department.
Agreed Management Action With regards to the Ministry apportioning between 77% to 100% of the costs incurred, in the absence of any international set criteria for apportioning climate change costs to climate centric projects and the inherent cost tracking limitations of the current FMIS system, the Ministry used its judgement through technical experts based with the Climate Change and International Cooperation Division to apportion at these rates.
The Green Bond Framework did not stipulate the need for any documented procedures and did not specify any set criteria to apportion such monies.

Therefore the Ministry fully complied with the Green Bond Framework, utilised its in- house climate experts to assess the projects and assign apportion weightings and had fully communicated this to the independent auditors (KPMG) who saw no issues with this approach.
Ministry of Economy Head 4: Page 151 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 The GL figures used was reconciled with green bond proceeds used on a monthly basis and such errors are inherent in the current FMIS.

However, they are not large to result in material mismatches.

In the absences of a robust FMIS system, such minor mismatches and negative balances are inherent when carrying out monthly reconciliations.
Furthermore, the negative balance mainly represents reversal entries that were carried out to correct anomalies identified during the monthly reconciliation process.

However, this does not affect the total expenditure for the project at the end of the year.
Officer Responsible Climate Finance Specialist through the Head of Climate Change & International Cooperation of the Ministry of Economy Ministry of Economy Head 4: Page 152 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 APPENDIX 1: MINISTRY OF ECONOMY FINANCIAL STATEMENT AMENDMENTS to Amendments Date 18/12/2018 12/06/2020 Reference Financial Statements Head 4 Schedule 8 Head 50 Schedule 9 Schedule 10 Note 22 Head 4 Schedule 1 Note 4(i) Note 4(ii) Head 50 Schedule 2 Schedule 7 TMA FPO Schedule 11 TMA FPO Schedule 12 TMA FPO Schedule 13 TMA Accommodation Schedule 14 TMA Accommodation Schedule 15 Schedule 16 Schedule 17 Note 31 Schedule 1 Note 6 07/08/2020 • Amendment of the Cell Format to correct the Main Trust Figure • Ministry of Agriculture Adjustment provided after finalisation of Draft Financial Statement for Economy, amendment to the Capital Grants and Transfer figure • Audit Adjustment for Direct and Indirect Taxes $1,961,346 • Audit Adjustment for Grant in Aid and Miscellaneous Revenue $2,172,576 • Amendment of Operating Revenue and Miscellaneous Revenue • Audit Adjustment from SEG 6 to SEG 10 $398,381 • Amendment to SEG 6 and SEG 10 figures • Audit Adjustment of Sales $17,118 and Cost of Goods Sold $178,880 • Amendment of Sales and Cost of Goods Sold Figure • Audit Adjustment of Office Upkeep & Supplies $145,854 • Audit Adjustment of Inventory $15,907 • Amendment to the Inventory figure $15,907 • Audit Adjustment Rental Quarters $4,423 and Other Expense $3,040 • Amendment of the Rental Quarters and Other Expense Figure • Audit Adjustment Cash at Bank and Net profit $7,463 • Amendment of the Cash at Bank and Net Profit Figure • Amendment of the Asset written off figure and inclusion of a table format of assets approved to be written off • Audit Adjustment of Adopt a School Trust Fund • Amendment of the Adopt a School Trust Receipts $403,374 • • Amended borrowing revenue to $603,836,968 Inclusion of note for the Description of the TMA Adjustment after Submission of Accounts Journal FAM
 325 Amount $1,825,399 ACF Adjustment $1,029,528 Entries Dr Grants in Aid- SRG 29 Cr Other Revenue & Surplus- SRG 27 Dr Accident Compensation Trust Fund Cr Trust Cash Ministry of Economy Head 4: Page 153 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 APPENDIX 2: INTERNAL CONTROL WEAKNESSES ACROSS MINISTRIES Ministries/Departments Extracted from the Auditor’s Report Department Immigration of The internal controls over revenue, payroll expenses, procurements and payments and Bond Trust Fund Account for the Department of Immigration were generally found to be weak.
This was due to lack of supervisory checks and reconciliations not properly carried out, improper record keeping and lack of proper planning and budget management.

Ministry of Employment, Productivity and Industrial Relations Internal controls over payroll were generally found to be weak.

This was due to payroll reconciliations not being prepared on a timely basis, overpayments of salary and lack of due diligence in recruitment.
Ministry Affairs of Foreign Internal controls over procurement of goods and services were generally found to be weak.

This relates to Local Purchase Orders not attached to payment vouchers, competitive quotations not obtained, payments were not adequately supported and rental agreements for overseas missions were not provided for audit verification.

Ministry of Disaster and National Security Statement of Losses - included in the financial statements which relates to loss of assets.
The Ministry did not carry out the annual Board of Survey for assets other than money at the end of the Financial year.

Therefore, any losses of assets other than money could not be determined.

Fiji Corrections Service Fiji Police Force Internal controls over the preparation of TMA cash a bank reconciliations were generally found to be weak.

Instances were noted where TMA cash at bank reconciliations were not adequately supported.
Note 6 of the Fiji Correction financial statement provides a brief description for the purpose of the Prisoners Cash Trust Account.

As at the date of audit report, the Fiji Correction Service was in the process of updating the beneficiaries listing which details the actual cash earned by the prisoners during incarceration.
The Force did not include as part of the Financial Statements the Trust Fund Account Statement of Receipts and Payments for the Force Band Trust Fund Account with receipts $84,542 and payment amounting of $66,485 for the period ended 31 July 2018.

In addition, the Force Band account transactions were not recorded in the FMIS General Ledger.
Peacekeeping Missions The Peacekeeping Missions did not carry out a complete board of survey to verify the existence and condition of the assets under its authority except for Black Rock training camp contrary to Section 49(2) of the Finance Instructions 2010.

Ministry of Education, Heritage and Arts Internal controls over payroll, revenue and Free Education Grant were generally found to be weak.
Department of Housing Internal controls over payment process and payroll were generally found weak and if not addressed promptly may result in material misstatements and possible financial losses in the near future.

The weak payment controls resulted in the lump sum payment of grant contrary to the grant agreement.

Ministry of Forestry Expenditures amounting to $351,097 were not recorded in the Statement of Receipts and Expenditure for the year ended 31 July 2018.
This amount relates to unrecorded expenditures which were paid as accountable advance but were not cleared from the Revolving Fund Account as at 31 July 2018.

Consequently, the expenditure for the year end 31 July 2018 is understated by $351,097.
Ministry of Economy Head 4: Page 154 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Ministries/Departments Extracted from the Auditor’s Report Ministry of Waterways The Ministry did not carry out an annual board of survey to determine the existence and conditions of all assets under its authority contrary to section 49 of Finance Instruction 2010.
Ministry of Health and Medical Services The Ministry recorded Purchase of Goods and Services of $62,647,164 and Capital Constructions of $17,335,118 in the Statement of Receipts and Expenditure for the year ended 31 July 2018.

The Ministry was unable to provide audit with appropriate documents such as payment and journal vouchers to support expenditures totalling $2,034,466.

The Ministry recorded total receipts of $6,233,916 in the Statement of Receipts and Expenditure.
The Ministry was unable to provide audit with revenue receipts to support revenue amounting to $143,286.

In addition, internal controls over receipting were generally found to be weak.

Purchases in the Bulk Purchase Trading and Manufacturing Account is overstated by $6,064.

As a result, the Trading and Manufacturing Account net profit for the year ended 31 July 2018 is understated by $6,064.Internal controls over receipts and payments were generally found to be weak.
This relates to price charged not in accordance with the price list and the understatement of utility costs which is not paid by the Bulk Purchase Trading and Manufacturing Account.
of Women, Ministry Children and Poverty Alleviation Unreconciled variance of $8,802,261 exists between the Social pension Scheme, Poverty Benefit Scheme Food vouchers for Rural Pregnant Mother and Child Protection General Ledger balance of $85,246,927 and the amount released to bank of $76,444,666 for the year ended 31 July 2018.
Ministry of Agriculture Ministry of Fisheries Misposting in Travel expenditure by $204,579 and Purchase of Goods and Services expenditure by $735,010 resulted in overstatement of the respective operating expenditure.

Misposting in Operating Grants and Transfers expenditure resulted in understatement of account by $944,262.

Internal controls over procurement and account reconciliations were generally found to be weak.
Internal controls over payroll expenses, procurement processes and management of inventory for Trading Activity were generally found to be weak.

The Ministry recorded Capital Construction of $4,756,332 and Capital Purchase of $653,185 in the Statement of Receipts and Expenditure for the year ended 31 July 2018.

Internal controls over revenue, underline accounts and expenditure were generally found to be weak.
These relate to the delay in banking of revenue receipts and delay in preparation of underline accounts reconciliations.

Payments were also made without local purchase orders being raised, three competitive quotation not obtained, misallocation of expenditures were made without payment vouchers being certified.
Ministry of Economy Head 4: Page 155 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 APPENDIX 3: PFTAC ACTIVITIES YET TO BE IMPLEMENTED Activities Responsible Ministry Outputs Expected Completion (Year) I) Developing and implementing a Framework for identifying, Estimating, and Reporting of Fiscal Risks arising from Public Enterprises/Statutory Authorities risk monitoring fiscal Integrate a function reorganised the MOE in structure; Providing training to the staff on fiscal risk analysis implementing the Fiscal Risk Start Assessment Monitoring and Framework, first on the entities with outstanding loans and loan guarantees (Phase 1) Ministry Economy Ministry Economy Expand fiscal risks assessment to cover all PEs/SAs (Phase 2) Ministry Economy Start including a Statement of Consolidated Fiscal Risks (explicit and implicit) in the Budget Supplement based on the results of Phase 1 fiscal risks monitoring Ministry Economy the risks on on-lending Evaluate receivables, an recognise and allowance for doubtful accounts for high risk accounts Ministry Economy of of of of of Fiscal Risk Monitoring function assumed by one of MOE Divisions/Units the Initial Entity Risk Profile based 2014/2016 financial statements of selected PEs/SAs on October 2017 April 2018 Expanded Fiscal Risk Assessment Report starting for FY 2017 From August 2018 Statement of Fiscal Risks (explicit and implicit) in the Budget Supplement June 2019 Allowance for doubtful accounts for high risks recorded accounts starting 2017/2018 July 2018 II.
Strengthening Fiscal Oversight by Ministry of Economy Disclose in the Notes to Financial Statements the following: • summary of Transactions between the Government and PEs/SAs; financial information of PEs/SAs – total revenues, expenses, assets and liabilities.
• Ministry Economy of in the Disclosures 2016/2017 consolidated financial statements of the central government October 2017 Review and improve the NCO Policy in the context of the new PE Act Ministry Economy Integrate PEs/SAs debt and fiscal risks in the Debt Management Strategy Ministry Economy Clarify financial regulations for PEs/SAs including accounting and reporting standards Ministry Economy III.
Improving Institutional Coordination of Improved NCO Policy June 2018 of of More comprehensive Debt Management Strategy Clear financial regulations for NCSAs October 2018 January 2019 further Review the draft PE Act Amendment and the draft PFM Act Amendment, to ensure consistency, and clarity of roles and responsibilities Ministry of Public Enterprises and Ministry of Economy Consistent and clear legal frameworks July 2017 Ministry of Economy Head 4: Page 156 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Activities Improve coordination and synergy regarding oversight of PEs Responsible Ministry Outputs Ministry of Public Enterprises, Ministry Economy sector ministries of and Consistent policies, reports Expected Completion (Year) legislations, strategies, January 2018 Consider proposing a common fiscal year for all public entities, to enable consolidated reporting in the future Ministry Economy of Policy on common fiscal year for all public entities January 2019 APPENDIX 4: CAUSE OF DELAY IN FINALISATION OF FINANCIAL STATEMENTS Provision of documents Grant Facilities: Details of the grant received and approved for July 2018 Independent Dividend JP Morgan confirmation Supporting documents to substantiate the balances stated in Note 47- Equity Movements for Adjustments of underlying account balances and equity- $11,236,313 Date Requested 29/1/2020 17/2/2020 29/1/2020 Date Provided 24/2/2020 Not received 08/05/2020 Date 26/06/2020 Reference to Financial Statements Schedule 1 Amendments • Amendment to Direct Taxes figure from $827,685,561 to $825,724,215 • Amendment to Indirect Taxes figure from $2,003,950,281 to $2,005,911,627 • Amendment to Sales revenue figure from $13,886,521 to $12,204,774 • Amendment to Other revenue figure from $40,360,393 to $44,902,829 • Amendment to Grant in Aid figure from $49,113,997 to $49,461,175 • Amendment of Established Staff from $900,320,078 to $900,309,981 • Amendment of Government Wage Earners from $58,828,853 to $58,949,182 • Amendment of Travel and
 Communication from $38,480,263 to $38,444,765 • Amendment of Operating Grants & Transfers from $680,568,975 to $680,170,593 • Amendment of Special expenditure from $88,293,406 to $88,246,446 • Amendment of Capital Grants & Transfers from $1,203,332,689 to $1,203,731,071 • Amendment to Cost of Goods Sold from $272,549 to $451,429 • Amendment to $17,519,139 to Other Expense from $13,059,541 • Amendment to Capital Expenditure from $1,369,381,078 to $1,369,779,460 • Amendment to Receipt from Lending & On Lending from $1,321,618 to $1,655,995 Ministry of Economy Head 4: Page 157 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Date Reference to Financial Statements Amendments Schedule 2 Schedule 2A Schedule 10 • Amendment to Proceeds from borrowings figure from $595,263,937 to $599,081,528 • Amendment of Operating Expenditure from $1,993,285,374 to $1,992,914,766 due to audit adjustments Ministry of Housing • Amendment of Capital Expenditure from $1,380,091,525 to $1,380,489,907 due to audit adjustment Head 50 • Amendment of Established Staff from $900,320,078 to $900,309,981 • Amendment of Government Wage Earners from $58,828,853 to $58,949,182 • Amendment of Travel and Communication from $38,480,263 to $38,444,765 • Amendment of Operating Grants & Transfers $680,568,975 to $680,170,593 due to audit adjustments from • Amendment of Special expenditure from $88,293,406 to $88,246,446 due to audit adjustments • Amendment of Capital Grants & Transfers from $1,203,332,689 to $1,203,731,071 Note 17 • Amendment of Note 17(b) figure from $153,902,598 to $153,553,749 • Amendment of Note 17(c) figure from $120,765220 to $164,938,055 • Amendment of Note 17(d) Proceeds figure from $595,263,937 to $599,081,528 Schedule 3 Note 26 Note 28 Note 29 Note 30 • Amendment of Cash and cash Equivalent Figure from $286,981,870 to $287,683,257 • Amendment of Accounts Receivable figure from $153,902,598 to $153,553,749 • Amendment of Inventory figure from $3,145,693 to $3,129,786 •
 Amendment of Term Loan Receivable figure from $573,022,960 to $572,199,307 • Amendment of Equity Investments figure from $1,334,855,420 to $1,335,906,060 • Amendment of Trading & Manufacturing Operation Revenue from $17,957,873 to $17,970,568 • Amendment of Operating expense from $2,030,242,061 to $2,029,871,453 • Amendment of Capital expense from 1,381,885,283 to $1,382,283 • Amendment of Trading and Manufacturing Operations expense $13,332,090 to 413,368,155 • Amendment of Government Guarantee figure from $586,739,797 to $587,395,644 • Amendment of Implicit Contingent Liability figure from $81,281,631 to $63,130,649 • Amendment of Consolidated Trust Fund from $161,621,657 to $162,270,743 thus changing the Total Trust figure from $198,081,568 to $198,730,654 figure • Amendment of Arrears of Revenue figure from $89,500,795 to $89,741,263 • Changes in equity movements • Amendment in Non-Exchange Revenue figure from $2,878,924,440 to $2,881,097,016 Schedule 4 Note 35 Note 39 Note 44 Schedule 5 Note 34 Note 32 Note 45 Arrears of Revenue Note 46 Schedule 6 Note 37 Ministry of Economy Head 4: Page 158 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Date Reference to Financial Statements Amendments • Amendment in Exchange Revenue CFA from to $182,534,055 $198,319,351 and TMA figure from $17,957,873 to $17,970,568 from in Operating Expenditure CFA $2,016,909,971 to $2,029,871,453 and TMA figure from $13,332,090 to $13,368,155 figure figure • Amendment • Amendment in Capital Expenditure figure from $1,381,885,283 to $1,382,283,665 • Amendment in Cash at Bank TMA figure from $13,305,105 to $13,630,893 Schedule 7 Schedule 8 Note 37 • Amendment to Direct Taxes figure from $827,685,561 to $825,724,215 • Amendment to Indirect Taxes figure from $2,003,950,281 to $2,005,911,627 • Amendment to Other Receipts figure from $34,748,343 to $34,401,166 • Amendment to Grant in Aid figure from $49,113,997 to $49,461,175 Schedule 9 • Reformatting the Ministry and
 Department List • Amendment of Ministry of Housing Actual figure from $18,898,239 to $18,853,826 • Amendment of Ministry of Local Government Actual figure from $28,684,771 to $22,320,054 Schedule 11 • Amendment of projected figures for 2019 and 2020 to be aligned Schedule 12 07/08/2020 Schedule 1 with Approved Budget Estimate 2017-2018 • Amendment of projected figures for 2019 and 2020 to be aligned with Approved Budget Estimate(Original Budget) 2017-2018 • Amendment to figures for Cashflow from Operating Activities o Other Revenue and surplus o Net receipts into Trust Fund Accounts • Amendment to figures for Cashflow from Investing Activities o Capital expenditures • Amendment to figures for Cashflow from financing Activities o Proceedings from borrowings o Repayment of borrowings o Net proceeds for net proceedings/repayments of Treasury bills • Amendment to figures for Operating receipts and Investing receipts Schedule 2 & 2A • Amendment to figures for Charges in public debt and Capital expenditure Note 18 • Amendment to figures for Timing differences for Total Cash Note 19 Note 20 Note 27 receipts and Total Cash payments.
• Amendment to figures for Payment to third parties Capital payments due to incorrect classification from $10,710,447 to $5,955,007.
• Amendment to figures for External assistance and other to from $47,288,597 assistance Grants and Donations $48,845,812 o Net Cash • Amendment to figures for Cash and cash equivalent: flows $731,187,650 to $730,559,822 flows $1,209,083,670 to $1,215,632,867 o Net Cash from operating activities investing activities from from from Ministry of Economy Head 4: Page 159 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF FIJI – 31 JULY 2018 Date Reference to Financial Statements Amendments o Net Cash flows $480,122,509 to $486,896,160 from financing activities from Note 34 • Amendment to figures for Term Loan Payable: o Net trust cash flows from $882,079 to $1,285,453 o Multilateral: ▪ Asian Development Bank from $4,564,541 to $5,404,957 ▪ World Bank from $6,145,906 to $550,050 o Overseas Loans ▪ Cash Borrowings from $63,467,937 to $68,223,377 ▪ Non Cash borrowings $10,710,447 to $5,955,007 Note 35 Note 38 • Amendment to the total Explicit Contingent Liability amount • Amendment to figures for Revenue from exchange transactions from $34,401,166 to $34,402,796 Note 46 • Disclosure of Land Transport Authority has been included in the Total Arrears of Revenue Schedule 5 • Amendment to the Contingent Liability the Opening balance, Closing balance and movements for PAFCO.
Schedule 6 • Amendment to figures for Primary Reportable Segments 2018 for: o Cash at Bank o Accounts Receivable o Accounts Payable 12/08/2020 (via email) Schedule 9 Schedule 12 Schedule 5 • Reclassifying Peacekeeping Mission to General Administrations • Reclassifying Peacekeeping Mission to General Administrations • Amended movements in balances for PAFCO from $1,930,474 Note 50 • & $1,865,14 to $2,847,280 and $2,781,955 Inclusion of disclosure on Events After Reporting Date Ministry of Economy Head 4: Page 160 / : – .
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0 0 5 , 2 e t u t i t s n i s s e n s u b i l l a m S p o - o C 5 3 0 5 9 8 - 1 0 0 0 8 - 1 0 4 4 3 - 9 9 1 0 2 e t u t i t s n i s s e n s u b i l l a m S p o - o C 1 0 3 0 2 5 - 1 0 0 0 8 - 1 0 4 4 3 - 9 e u n e v e R s u o e n a l l e c s M i 9 9 9 9 7 2 - 1 0 1 4 3 - 1 0 1 4 3 - 1 ) ( i ) ) s u o v e r p & t n e r r u c ( s k c o t s d e r i p x E f o t n e m t s u d A j ( d n a L r o f l a t n e R 1 0 2 0 7 2 - 1 0 1 9 7 - 1 0 3 3 3 - 1 9 1 0 2 / / 4 6 1 / / 4 6 1 e u n e v e R s u o e n a l l e c s M i 9 9 9 9 7 2 - 1 0 1 0 2 - 1 0 1 0 2 - 1 e u n e v e R s u o e n a l l e c s M i 9 9 9 9 7 2 - 1 0 1 0 2 - 1 0 1 0 2 - 1 e u n e v e R s u o e n a l l e c s M i 9 9 9 9 7 2 - 1 0 1 0 2 - 1 0 1 0 2 - 1 e u n e v e R s u o e n a l l e c s M i 9 9 9 9 7 2 - 1 0 1 0 2 - 1 0 1 0 2 - 1 e u n e v e R s u o e n a l l e c s M i 9 9 9 9 7 2 - 1 0 1 0 2 - 1 0 1 0 2 - 1 e u n e v e R s u o e n a l l e c s M i 9 9 9 9 7 2 - 1 0 1 0 2 - 1 0 1 0 2 - 1 ) g n i r e t a C & s n o i t a e r C m o a h S o t l t n e m t s u d A j ( 9 1 0 2 5 7 / / 0 2 .
0 9 8 , 9 3 1 l e a s r o f s d o o g d e h s n F i i 1 0 3 0 8 5 - 9 9 9 0 3 - 1 5 3 0 3 - 4 6 6 1 e g a P : & .
2 4 0 5 9 4 8 , - 1 0 1 0 2 - 1 0 1 0 2 - 1 I U C E C V R E S E C I L O P D P 7 0 3 7 1 5 1 6 8 - 1 0 1 0 2 - 1 0 1 0 2 - 1 8 1 0 2 Y L U J 1 3 – .

0 0 5 2 1 1 , .

0 2 6 9 5 3 2 , 9 1 .


4 1 6 , 6 1 5 S D G F O N S V O R P M O R F T A V 1 0 2 3 6 8 - 1 0 1 0 2 - 1 0 1 0 2 - 1 & E R U T C U R T S A R F N I F M F 2 2 4 0 8 0 - 9 9 9 9 1 - 4 0 1 9 1 - 1 V R E S & ( x a T d e d d A e u a V l ) e u n e v e r s u o e n a l l e c s m i 1 0 1 0 3 1 - 9 9 9 9 1 - 1 0 1 9 1 - 1 9 1 0 2 / 5 0 1 2 / .

0 0 5 2 1 1 , .

0 2 6 9 5 3 2 , 2 4 .

5 4 7 2 .

6 8 5 3 1 5 9 .

4 0 2 1 .


8 8 1 3 7 .

9 0 1 8 5 .

1 1 1 0 .
- 9 9 9 9 1 - 1 0 1 9 1 - 1 E E Y O L P M E C I L B U P D P Y Y Y 2 3 5 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - - 9 9 9 9 1 - 1 0 1 9 1 - 1 I E C N A N F M A R S E W 3 3 5 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - 1 D T L L E T A P D O N V I - D E D L O R Y A P 6 2 9 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - - 9 9 9 9 1 - 1 0 1 9 1 - 1 3 3 9 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - 1 E R A F L E W W P U N 4 3 9 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - - 9 9 9 9 1 - 1 0 1 9 1 - 1 I C I L - D P 4 4 2 4 0 2 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - 1 F M F R - A V U S P S B S G N W A R D I 1 0 3 0 3 5 - 9 9 9 9 1 - 1 0 1 9 1 - 1 F M F R - A V U S P S B S G N W A R D I 1 0 3 0 3 5 - 9 9 9 9 1 - 1 0 1 9 1 - 1 ) ( E C N A R U S N I E R A C I J I F D P 0 4 2 1 0 2 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - 1 9 1 0 2 / 5 0 1 2 / 7 6 1 e g a P : & .
7 1 7 0 5 7 5 3 5 5 4 .

3 3 6 0 5 7 5 3 5 5 4 .

3 3 6 1 1 .
2 4 1 , - A V U S P S B S G N W A R D I 1 0 3 0 3 5 - 9 9 9 9 1 - 1 0 1 9 1 - 1 ) ( e c n e t s s b u S i 1 0 3 0 3 0 - 9 9 9 9 1 - 5 0 1 9 1 - 1 ) ( F M F R s e c n a v d A 1 0 3 0 7 5 - 9 9 9 9 1 - 1 0 1 9 1 - 1 9 1 0 2 / 5 0 1 2 / – - 9 9 9 9 1 - 1 5 1 9 1 - 4 1 0 3 0 4 5 - 9 9 9 9 1 - 1 5 1 9 1 - 4 9 1 0 2 / 5 0 1 2 / A V U S ) s e u q e h c l e a t s s ' ( F M F - S U L P R U S A M T 9 1 3 0 4 9 - 9 9 9 9 1 - 1 5 1 9 1 - 4 F M F - S U L P R U S A M T 9 1 3 0 4 9 - 9 9 9 9 1 - 1 5 1 9 1 - 4 B N C H S A C N O N M O D A M T I I 1 0 3 0 4 5 - 9 9 9 9 1 - 1 5 1 9 1 - 4 9 1 0 2 / 5 0 1 2 / 2 3 .
3 5 4 , 1 7 3 6 2 1 .

1 1 2 4 1 4 , 6 2 1 F M F - S U L P R U S A M T 9 1 3 0 4 9 - 9 9 9 9 1 - 1 5 1 9 1 - 4 9 1 0 2 / 5 0 1 2 / A V U S F M F - S U L P R U S A M T 9 1 3 0 4 9 - 9 9 9 9 1 - 1 5 1 9 1 - 4 ) s e g r a h C A M T F M F R f o r o f t n e m t s u d A j ( 2 3 .
3 5 4 , 1 7 3 F M F - S U L P R U S A M T 9 1 3 0 4 9 - 9 9 9 9 1 - 1 5 1 9 1 - 4 9 1 0 2 / 5 0 1 2 / I T H G E R F D N A L E C R A P 7 0 4 0 6 2 - 9 9 9 9 1 - 1 5 1 9 1 - 4 ) ( 0 0 .

0 5 0 , 7 3 I N O T C U D E D L L O R Y A P Y Y Y 9 9 9 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - 1 L E C S M I 0 0 .
0 8 9 , 9 3 I N O T C U D E D L L O R Y A P Y Y Y 9 9 9 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - 1 9 1 0 2 / 5 0 1 2 / A V U S ) ( B N C H S A C N O N M O D A M T I I 1 0 3 0 4 5 - 9 9 9 9 1 - 1 5 1 9 1 - 4 8 6 1 e g a P : & .
0 9 7 , - 9 9 9 9 1 - 1 0 1 9 1 - 1 8 1 0 2 Y L U J 1 3 – .

0 0 0 8 9 9 3 , .

0 0 0 5 0 7 3 , .

0 0 0 9 7 9 7 , .

0 0 5 4 1 3 6 , 6 0 .

8 9 1 , 0 6 2 .

2 4 1 8 5 9 1 , 0 2 .

7 2 8 , 8 6 3 .

0 0 0 0 0 9 2 , 0 0 .


5 4 1 , 3 6 I N O T C U D E D L L O R Y A P Y Y Y 9 9 9 1 6 8 - 9 9 9 9 1 - 1 0 1 9 1 - 1 8 8 .

5 1 6 , 3 8 2 5 6 .

1 2 0 , 2 0 4 0 9 .

1 5 9 , 8 4 0 0 .

0 1 6 , 1 3 0 0 .

5 5 0 , 3 4 5 7 .

3 4 3 , 1 2 0 0 .
0 0 0 , 9 2 I Y E N O M N O T N E T E R P A 1 0 1 2 6 8 - 9 9 9 1 7 - 1 0 2 5 1 - 1 I Y E N O M N O T N E T E R P A 1 0 1 2 6 8 - 9 9 9 1 7 - 1 0 2 5 1 - 1 I Y E N O M N O T N E T E R P A 1 0 1 2 6 8 - 9 9 9 1 7 - 1 0 2 5 1 - 1 I Y E N O M N O T N E T E R P A 1 0 1 2 6 8 - 9 9 9 1 7 - 1 0 2 5 1 - 1 I Y E N O M N O T N E T E R P A 1 0 1 2 6 8 - 9 9 9 1 7 - 1 0 2 5 1 - 1 - I K T L F O N O T C U R T S N O C 9 9 2 0 8 0 - 9 9 9 1 7 - 1 0 2 5 1 - 1 - I K T L F O N O T C U R T S N O C 9 2 2 0 8 0 - 9 9 9 1 7 - 1 0 2 5 1 - 1 ® Y T I L I C A F N E M O W ® Y T I L I C A F N E M O W - I K T L F O N O T C U R T S N O C 9 2 2 0 8 0 - 9 9 9 1 7 - 1 0 2 5 1 - 1 e r u t c u r t s a r f n I n t t s n I C T N M & r i a p e R 9 9 1 0 8 0 - 9 9 9 1 7 - 1 0 2 5 1 - 1 ® Y T I L I C A F N E M O W n t t s n I C T N M & r i a p e R e r u t c u r t s a r f n I 9 9 1 0 8 0 - 9 9 9 1 7 - 1 0 2 5 1 - - 2 0 1 9 4 - 2 0 1 9 4 - 1 R E H T O D N A S R E C F F O I 1 0 1 0 1 0 - 3 0 1 9 4 - 3 0 1 9 4 - 1 S K N A R R E H T O D N A S R E C F F O I 1 0 1 0 1 0 - 3 0 1 9 4 - 3 0 1 9 4 - 1 S K N A R R E H T O D N A S R E C F F O I 1 0 1 0 1 0 - 3 0 1 9 4 - 3 0 1 9 4 - 1 S K N A R ) 1 3 2 5 4 D I h c t a B 7 1 0 2 / 8 1 y a P f o t n e m t s u d A j ( I Y E N O M N O T N E T E R P A 1 0 1 2 6 8 - 9 9 9 1 7 - 1 0 2 5 1 - 1 9 1 0 2 / 6 0 7 1 / 9 6 1 e g a P : & – .
0 0 0 0 0 9 2 , .

0 0 0 1 9 4 4 , .

0 0 0 0 5 9 3 , .

2 8 7 1 4 3 2 , .

5 4 4 9 1 3 3 , .

0 9 1 4 0 4 , .

0 0 0 1 6 2 , .

0 0 5 5 5 3 , .

3 3 2 6 7 1 , 5 3 .

0 0 4 , 3 4 8 9 .

0 0 2 , 3 1 0 0 .

4 3 6 , 2 6 5 .

2 5 2 , 6 8 0 0 .

8 4 1 , 3 1 0 0 .

1 5 9 , 3 1 1 8 0 .

5 1 5 , 1 2 1 0 0 .

0 2 4 , 3 0 0 .

0 0 3 , 1 8 6 .

9 8 4 , 1 5 1 .

7 9 2 0 0 .
5 5 3 , 1 - I K T L F O N O T C U R T S N O C 9 9 2 0 8 0 - 9 9 9 1 7 - 1 0 2 5 1 - 1 ® - 9 9 9 1 7 - 1 0 2 5 1 - 1 K R O W E D A R G P U L A C R T C E L E I 7 0 8 0 8 0 - 9 9 9 1 7 - 1 0 2 5 1 - 1 K R O W x a T d e d d A e u a V l 1 0 1 0 3 1 - 9 9 9 1 7 - 1 0 2 5 1 - 1 x a T d e d d A e u a V l 1 0 1 0 3 1 - 9 9 9 1 7 - 1 0 2 5 1 - 1 x a T d e d d A e u a V l 1 0 1 0 3 1 - 9 9 9 1 7 - 1 0 2 5 1 - 1 x a T d e d d A e u a V l 1 0 1 0 3 1 - 9 9 9 1 7 - 1 0 2 5 1 - 1 x a T d e d d A e u a V l 1 0 1 0 3 1 - 9 9 9 1 7 - 1 0 2 5 1 - 1 x a T d e d d A e u a V l 1 0 1 0 3 1 - 9 9 9 1 7 - 1 0 2 5 1 - 1 ) ( N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 5 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 6 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 7 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 7 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 7 5 2 5 1 - 4 I S E N A P M O C R A 2 0 1 0 6 5 - 1 5 1 1 9 - 7 5 2 5 1 - 4 Y C N E G A & S T P E D V O G R A 1 0 1 0 6 5 - 1 5 1 1 9 - 9 5 2 5 1 - 4 Y C N E G A & S T P E D V O G R A 1 0 1 0 6 5 - 1 5 1 1 9 - 8 5 2 5 1 - 4 Y C N E G A & S T P E D V O G R A 1 0 1 0 6 5 - 1 5 1 1 9 - 8 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 2 5 2 5 1 - - 1 5 1 1 9 - 8 5 2 5 1 - 4 3 0 1 0 6 5 - 1 5 1 1 9 - 8 5 2 5 1 - 4 / 0 1 9 / 0 7 1 e g a P : & – o
0 1 0 6 9 8 5 , 1 6 .

9 2 5 .

6 3 1 5 0 4 , .

3 4 5 4 6 8 , .

5 3 0 0 4 3 4 , .

0 0 0 1 8 4 , 5 1 .

7 9 2 .

0 0 5 5 3 1 , .

0 0 0 5 3 6 1 , .

0 0 0 0 3 1 , .

8 6 9 8 4 1 , .

0 0 3 5 6 1 , 8 0 .

5 1 5 , 1 2 1 .

0 0 0 2 5 9 1 , .

6 5 2 5 2 6 8 , .

0 0 0 2 4 3 , .

8 9 0 9 3 8 , .

0 0 8 4 1 3 1 , 0 0 .

1 5 9 , 3 1 1 .

0 0 4 3 6 2 , 0 0 .

3 5 6 , 1 0 0 .

0 2 5 , 9 1 0 0 .
0 5 3 , 6 1 Y C N E G A & S T P E D V O G R A 1 0 1 0 6 5 - 1 5 1 1 9 - 9 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 8 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 8 5 2 5 1 - 4 I S E N A P M O C R A 2 0 1 0 6 5 - 1 5 1 1 9 - 6 5 2 5 1 - 4 I S E N A P M O C R A 2 0 1 0 6 5 - 1 5 1 1 9 - 7 5 2 5 1 - 4 I S E N A P M O C R A 2 0 1 0 6 5 - 1 5 1 1 9 - 7 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 8 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 8 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 9 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 8 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 8 5 2 5 1 - 4 I S E N A P M O C R A 2 0 1 0 6 5 - 1 5 1 1 9 - 7 5 2 5 1 - 4 I S E N A P M O C R A 2 0 1 0 6 5 - 1 5 1 1 9 - 5 5 2 5 1 - 4 S L A U D V D N I I I R A 3 0 1 0 6 5 - 1 5 1 1 9 - 8 5 2 5 1 - 4 Y C N E G A & S T P E D V O G R A 1 0 1 0 6 5 - 1 5 1 1 9 - 8 5 2 5 1 - 4 N O S R P I - P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 7 5 2 5 1 - 4 Y C N E G A & S T P E D V O G R A 1 0 1 0 6 5 - 1 5 1 1 9 - 2 5 2 5 1 - 4 I - N O S R P P R U S C C A A M T 1 7 4 0 4 9 - 1 5 1 1 9 - 9 5 2 5 1 - 4 S L A U D V D N I I I R A 3 0 1 0 6 5 - 1 5 1 1 9 - 5 5 2 5 1 - 4 l i ) - 9 9 9 7 3 - 1 0 1 7 3 - 1 1 0 1 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 1 0 1 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 f o e c n a r a e c l f o t n e m t s u d A j ( 1 0 1 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 0 2 0 2 / 3 0 0 2 / 1 7 1 e g a P : & y m o n o c E f o i y r t s n M i .
0 8 0 7 9 4 1 , .

2 8 3 6 4 1 , .

1 0 7 9 0 0 1 , .

0 2 6 6 5 3 , .

0 1 0 6 9 6 4 , .

1 0 7 9 0 0 1 , .

0 0 0 0 0 2 1 , 9 7 3 1 .

1 2 .

3 5 1 .

0 8 0 7 9 4 1 , 0 8 0 8 0 0 1 .

0 2 9 9 3 3 , .

3 4 5 4 6 8 , .

6 3 1 5 0 4 , .
0 2 9 9 3 3 , - L A E M W O L L A 1 0 3 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 - L A E M W O L L A 1 0 3 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 - L A E M W O L L A 1 0 3 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 I E M T R E V O 1 0 4 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 I E M T R E V O 1 0 4 0 2 0 - 9 9 9 7 3 - 2 0 1 7 3 - 1 I E M T R E V O 1 0 4 0 2 0 - 9 9 9 7 3 - 2 0 1 7 3 - 1 I E M T R E V O 1 0 4 0 2 0 - 9 9 9 7 3 - 2 0 1 7 3 - 1 - L A E M W O L L A 1 0 3 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 E C N E T S S B U S I 1 0 3 0 3 0 - 9 9 9 7 3 - 2 0 1 7 3 - 1 E C N E T S S B U S I 1 0 3 0 3 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 E C N E T S S B U S I 1 0 3 0 3 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 - A V U S P S B S G N W A R D I 1 0 3 0 3 5 - 9 9 9 7 3 - 1 0 1 7 3 - 1 .
T V O G L A C O L - A V U S P S B S G N W A R D I 1 0 3 0 3 5 - 9 9 9 7 3 - 1 0 1 7 3 - 1 - L A E M W O L L A .
T V O G L A C O L 1 0 3 0 2 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 E C N E T S S B U S I 1 0 3 0 3 0 - 9 9 9 3 2 - 1 0 1 3 2 - 1 8 1 0 2 Y L U J 1 3 – - I G N S U O H L A N O T A N I 3 0 2 0 7 0 - 9 9 9 3 2 - 1 0 1 3 2 - 1 3 0 3 0 1 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 .

2 8 3 6 4 1 , 0 6 2 .


0 2 9 9 3 3 , 1 6 .

9 2 5 - A V U S P S B S G N W A R D I 1 0 3 0 3 5 - 9 9 9 7 3 - 1 0 1 7 3 - 1 E C N E T S S B U S I .
T V O G L A C O L 1 0 3 0 3 0 - 9 9 9 7 3 - 2 0 1 7 3 - 1 E C N E T S S B U S I 1 0 3 0 3 0 - 9 9 9 7 3 - 2 0 1 7 3 - 1 E C N E T S S B U S I 1 0 3 0 3 0 - 9 9 9 7 3 - 1 0 1 7 3 - 1 ) ( 2 7 1 e g a P : & .
9 4 8 , - 9 9 9 6 6 - 1 0 5 6 3 - 4 0 2 0 2 6 8 / / 8 1 0 2 Y L U J 1 3 – .

2 4 7 3 4 8 8 5 6 , , .

3 5 1 4 4 0 2 9 5 , , 8 1 .

, 7 9 7 4 7 7 1 5 , .

0 3 8 2 5 9 2 0 1 , , 7 0 .

3 9 7 , 2 4 4 , 2 5 0 3 .


8 2 5 , 9 2 0 , 1 S N E P M O C T N E D C C A I D N U F M M O C C A / H S A C T N E D C C A I D N U F S N E P M O C 1 0 7 0 2 5 - 2 0 1 4 0 - 2 0 1 4 0 - 9 3 2 9 9 9 8 - 2 0 1 4 0 - 2 0 1 4 0 - 9 0 2 0 2 v o N 5 3 .

9 4 8 , 8 4 3 Y C N E G A & S T P E D V O G R A 1 0 1 0 6 5 - 9 9 9 6 6 - 1 0 5 6 3 - 4 A V U S ) t n e m t s u d a j t i d u A ( 4 5 .

1 1 7 , 5 4 2 E M R G O R P L O O H C S T P O D A 4 6 0 5 9 8 - 9 0 1 4 0 - 9 0 1 4 0 - 9 4 5 .
1 1 7 , 5 4 2 T S U R T L O O H C S A T P O D A 0 9 0 5 9 8 - 9 0 1 4 0 - 9 0 1 4 0 - 9 T N U O C C A S U R T G O R P ) ( 0 2 0 2 6 8 / / .

0 0 8 9 5 5 1 , 0 0 .


8 9 5 , 5 1 I N E P O S R T D E R C E D A R T L G 1 0 4 0 4 8 - 9 9 9 6 6 - 1 0 5 6 3 - - 9 9 9 6 6 - 1 0 5 6 3 - 4 3 7 1 e g a P : & y m o n o c E f o i y r t s n M i