Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697774768474.pdf (Fiji)
ACCOUNTABILITY IN THE PUBLIC SECTOR THROUGH QUALITY AUDIT SERVICES REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS VOLUME 3 AUDIT REPORT ON GOVERNMENT MINISTRIES AND DEPARTMENTS- 2007 PARLIAMENTARY PAPER NO 8 OF 2014 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Section 11 Legislature Department Programme Statement The Constitution vests the Parliament of the Republic of the Fiji Islands with the legislative power to enact laws.
The Parliament consists of His Excellency the President, the House of Representatives and the Senate.

The core business of the Legislature is the Administration of the Parliament of the Fiji Islands, its committees and all formal proceedings of the two Houses, in the effective coordination of the role of the Houses of Parliament culminating in the presentation of Bills to His Excellency the President for his assent.
The functions of the Legislature Department are programmed as follows: General Administration • Provide briefings, procedural advice, administrative, research services and information to presiding officers and Members of Parliament.

• Strengthen and maintain relations at all levels with regional and international parliamentary organisations and associations and provide the necessary secretariat and hospitality services.

• Support services to the Government members.


• Coordinate Parliamentary ceremonial events and provide necessary protocol services.

• Organise induction and other procedural seminars for Members of Parliament.

• Strengthen human resources capacity.

• Promote public awareness and public relations with the community and the media on the process and proceedings of parliament.

House of Representatives • Support services to the House of Representatives members.
• Allocate annual contributions to Parliamentary organisations and associations to which Fiji is affiliated.

Senate • Provide support services to the Senators.

Opposition Office • Provide support services to the Opposition members.
Table of Content FINANCIAL STATEMENT ................................................................................................................ 2 11.1 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditures.................................................................... 2 11.2 Statement of Output Costs ......................................................................................... 3 11.3 Appropriation Statement ............................................................................................. 3 11.4 11.5 Statement of Losses .................................................................................................... 4 AUDIT FINDINGS ............................................................................................................................ 4 11.6 Financial Statements ................................................................................................... 4 11.7 FNPF Reconciliation .................................................................................................... 5 11.8 VAT Reconciliation ...................................................................................................... 5 11.9 Payment of Consolidated Allowance ........................................................................... 6 Legislature Department Section 11: Page 1 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 11.10 Overtime Claims .......................................................................................................... 7 11.11 Over-Expenditure ........................................................................................................ 9 11.12 Purchases and Payment Records ............................................................................. 10 11.13 Exorbitant Telecommunication Expenditures............................................................. 11 11.14
11 11.14 Outstanding Accountable Advance............................................................................ 12 Appendix 11.1: Statement of Output Costs .......................................................................... 14 Appendix 11.2: FNPF Reconciliation ................................................................................... 15 Appendix 11.3: VAT Reconciliation...................................................................................... 15 Appendix 11.4: Anomalies in Payments............................................................................... 16 Appendix 11.5: Examples of Missing Payment Vouchers .................................................... 18 FINANCIAL STATEMENT 11.1 Audit Opinion The audit of the 2007 accounts of the Legislature Department resulted in the issue of a qualified audit report.
The qualifications are as follows: a) b) The financial statements were incomplete as the Statement of Losses and Trust Account Statement of Receipts and Payments were not submitted for audit, contrary to Finance Instructions 82.

The Financial Management Information System shows that the Department as at 31/12/07 has operating trust funds totalling $171,140.

The Department has consolidated its expenditures into one Statement of Output Costs, whereas the Budget Estimates 2007 prescribes four outputs.
The amounts reflected in the Statement of Output Costs have been estimated as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

It is not possible therefore to express an opinion on the accuracy of the expenditures incurred by the Department under each output.

c) The payments of FNPF contributions and VAT could not be reconciled to the accounts.
11.2 Statement of Receipts and Expenditures The Department incurred total expenditures of $1,761,387 in 2007 compared to $10,436,815 in 2006.
Refer to Table 11.1 for details: Legislature Department Section 11: Page 2 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Table 11.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Agency Revenue TOTAL REVENUE EXPENDITURE Operating Costs Established Staff Government Wage Earners Travel & Communications Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Cost Capital Expenditure Capital Purchase Total Capital Expenditure 2007 $ 2006 $ 371 27,394 110,581 219 27,765 110,800 902,956 295,822 92,161 254,141 33,160 0 15,021 1,593,261 5,551,157 667,954 1,324,294 629,271 904,862 40,557 250,851 9,368,946 0 0 7,168 7,168 Value Added Tax 168,126 1,060,701 TOTAL EXPENDITURE 1,761,387 10,436,815 The reduction in expenditures for 2007 by $8,675,428 or 492% resulted from the closure of Parliament and the redeployment of most staffs to other Ministries/Departments.
11.3 Statement of Output Costs The Statement of Output Costs consolidates the 4 outputs prescribed in the Budget Estimates.

These are detailed in Appendix 11.1.

11.4 Appropriation Statement The Legislature Department incurred expenditures totalling $1,761,387 in 2007 against the budget of $1,485,128 resulting in an over-expenditure of $276,259 or 19%.

Details of expenditures against the budget estimates are provided in Table 11.2.
Table 11.2: Appropriation Statement for 2007 SEG Item 1 2 3 Established Staff Unestablished Staff Travel & Communication Budget Estimate $ 453,016 328,871 52,000 Changes $ 0 0 0 Revised Estimate $ 453,016 328,871 52,000 Actual Expenditure $ 902,956 295,822 92,161 Carry – Over $ 0 0 0 Lapsed Appropriation $ (449,940) 33,049 (40,161) Legislature Department Section 11: Page 3 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 SEG Item 4 5 6 Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Total Operating Costs 13 Value Added Tax Budget Estimate $ 236,500 40,000 234,641 1,345,028 140,100 TOTAL EXPENDITURE 1,485,128 11.5 Statement of Losses Changes $ 0 0 0 0 0 0 Revised Estimate $ 236,500 Actual Expenditure $ 254,141 40,000 234,641 1,345,028 33,160 15,021 1,593,261 140,100 168,126 1,485,128 1,761,387 Carry – Over $ 0 0 0 0 0 0 Lapsed Appropriation $ (17,641) 6,840 219,620 (248,233) (28,026) (276,259) The Department did not report any losses of money or assets in 2007.
AUDIT FINDINGS 11.6 Financial Statements Commencing 2006 financial year, each annual report must include financial statements which have been prepared and signed in accordance with the Finance Instructions, audited by the Auditor General, and accompanied by an audit opinion prepared by the Auditor General.1 The draft financial statements must be submitted to the Auditor General by 31 March in the following year, or within such other time as agreed to with the Auditor General.2 The Legislature submitted its financial statements for audit on 15/04/08 and were not prepared in accordance with the requirements of Section 82 and Schedule 1 of the Finance Instructions 2005.
The following discrepancies were noted: • The Department failed to prepare and submit with its financial statements a Statement of Losses and a Trust Fund Account Statement of Receipts and Payments.

• The Legislature has consolidated its expenditures into one Statement of Output Costs, whereas the Budget Estimates 2007 prescribes four outputs.
The amounts reflected in the Statement of Output Costs have been estimated as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

Recommendation The Legislature should ensure that the requirements of the Finance Instructions are complied with regards to the preparation of the Financial Statements.
1 Finance Instructions 2005 – 81 (2) 2 Finance Instructions 2005 – 81 (3) Legislature Department Section 11: Page 4 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Management Comments Your recommendation is noted.

This will be rectified in 2008 Agency Financial Statement.

Ministry of Finance has not provided template format for Statement of Output Costs.
11.7 FNPF Reconciliation Every employer shall pay to the Fiji National Provident Fund in respect of each of his/her employees, in every month during which such employee by him/her and in the month following the termination of such employment, a contribution calculated upon the amount of wages payable to such employee by such employer for the preceding month at the appropriate rates.3 The current rate of contribution (effective 1st July, 1999) is 16cents on each dollar earned, with the employer and employee each contributing 8 cents each.
Contributions that are paid after the due date carry a surcharge at a rate of 2%.

Failure to pay contributions on the due date is a serious and punishable offence.

4 A reconciliation of FNPF contributions against salaries and wages reported in the Financial Statements revealed that FNPF was not paid for salaries in the sum of $749,514.

Refer to Appendix 11.2 for details.

The above variance implied that the Department underpaid the FNPF contributions for its employees.
Recommendation The Office should review its FNPF records and reconciliations and provide explanations for the variance.

Management Comments The recommendation is noted.

All deductions made are being reconciled against the payments made to FNPF from January to December 2007 which would require some time.

You would be advised of the outcome once this exercise is completed.
11.8 VAT Reconciliation Subject to the provision of the Vat Decree 1991, the tax shall be charged in accordance with the provisions of the Decree at the rate of twelve and a half percent on the supply (but not including an exempt supply) in Fiji of goods and services, by a registered person in the course or furtherance of a taxable activity carried on by that person, by reference to the value of that supply.5 A review of the VAT returns and supporting documents and VAT reconciliations carried out during the audit revealed an un-reconciled balance of $185,356 between the taxable supplies as per VAT Return and the total income/expenditure as per the Statement of Receipts and Expenditure.
Refer to Appendix 11.3 for details.

3 Chapter 219 – Fiji National Provident Fund – Section 13 (1) 4 www.fnpf.com.fj –official web site address Fiji National Provident Fund 5 Value Added Tax Decree 1991 4th edition revised to 30/04/04 – section 15 (1) Legislature Department Section 11: Page 5 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Recommendations • The Department should review explanations for the variances.
its VAT records and reconciliations and provide • Supervisory checks on the preparation of VAT Returns should be improved to ensure that balances reflected in the VAT Returns reconcile with the general ledger.

Management Comments The recommendation is noted.

For clarification, the Department’s VAT allocation was exhausted due to the $60,380.55 payment made in January for December 2006.
Furthermore, Output VAT payments for the months of June and July were delayed as there were insufficient funds to meet this payments.

However, upon receipt of the two (2) Department Warrants 103/07 ($28,197.47) and 106/07 ($46,259.95) all charges for input and output VAT were made to IDC Treasury.

The VAT portion of all purchases was charged tm IDC Treasury and output VAT payments were also charged to IDC Treasury for the months of July; September; October; November and December 2007.
It would therefore follow that there would be some variance in the General Ledger and actual payments made to FIRCA as the Department’s GL Account and the IDC Treasury are different allocations.
11.9 Payment of Consolidated Allowance Overtime shall be approved only in essential circumstances and on the specific approval of the Head of Department.6 A consolidated allowance was approved by the Public Service Commission to be paid, in lieu of overtime, to Editors and Hansard Reporters, when Parliament is in session.

Two Officers continued to receive consolidated allowances although Parliament was no longer in session since 5th December 2006.
The total allowances received by both Officers as at 31st March 2008 amounted to $11,585.97.

Refer to Table 11.3 for details: Table 11.3: Consolidated Allowance Paid Name EDP No.
Serei Naicavu (Hansard Officer) 48443 Lusiana Bale (Assistant Editor) 19490 Year 2006 2007 2008 2006 2007 2008 Calculation $ Pay 26/06= $196.74 Pays 01/07 - 26/07 $196.74 * 26pays = $ 5,115.24 Pays 01/08 - 06/08 $196.74 * 6pays = $1,180.44 Pay 26/06=$154.35 Pays 01/07 - 26/07 $154.35 * 26 pays = $4,013.10 Pays 01/08 - 06/08 $154.35* 6 pays = $926.10 Amount $ 6,492.42 5,093.55 The Hansard Unit was working on pending documentation of parliamentary debates for the years 2005 and 2006 however no overtime work was approved by the Department for the Hansard staffs in 2007.
In addition, three officers who were transferred to the Administration Section in the Sector Standing Committee continued to receive consolidated allowances for a considerable period of time.
Refer to Table 11.4 for details of allowances paid in 2007: 6 General Orders 467 (a) Legislature Department Section 11: Page 6 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Table 11.4: Consolidated Allowances Name Kalo Takape EDP 47493 Amount ($) 01/01/07-31/12/07 Comments 5,115.24 Officer is currently a Senior Admin Officer and was still receiving the consolidated allowance in 2007 Kelera Sagoa 46878 Loraini Korovusere Records not available 4,139.72 Officer became Senior Admin Officer with effect from 15/07/1999 was still receiving the consolidated allowance in 2007 Officer has been deployed to the Ministry of Finance The payment of consolidated allowances should cease when an officer is transferred out of the Hansard Section unless stated otherwise by the Public Service Commission.
Recommendation • The Department should ensure that consolidated allowances are only paid to Editors and Hansard Reporters, in lieu of overtime when parliament is in session.

Management Comments All consolidated allowance payments effective from Pay 10/2008 (15/05/2008) has been ceased.

We have also written to Public Service Commission and are awaiting their ruling on the issue.
11.10 Overtime Claims Overtime shall be approved only in essential circumstances and on the specific approval of the Head of Department.7 A Temporary Clerical Officer Nacanieli Goneyali and an Acting Assistant Accounts Officer Niko Nabitakele claimed excessive overtime for which no proper approvals and justifications were provided.

Refer to Table 11.5 for details: Table 11.5: Excessive Overtime Claim Date Chq No.
Amount $ Remarks Niko Nabitakele 08/06/07 11914 11/06/07 09/08/07 11921 12155 982.28 • Overtime claim for October 2006.

• Payment voucher missing.

1,090.78 Overtime Claim.

Payment voucher missing.

1,678.77 • Overtime claim for December 2006.

• Payment voucher missing.

Total $3,751.83 Nacanieli Goneyali 12/01/07 11192 956.20 • Overtime claim for December 2006.
• No indication of payment being authorised and 7 General Orders 467 (a) Legislature Department Section 11: Page 7 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Date Chq No.

Amount $ Remarks 02/03/07 11449 23/03/07 11564 approved.

594.39 • Overtime claim was for February 2007.

• Payment Voucher Missing 455.95 • Overtime claim was for March 2007.

• Payment Voucher Missing 20/04/07 241.50 241.50 No indication of payment being authorised and approved.
07/05/07 187.18 187.18 No indication of payment being authorised and 11/05/07 11778 195.02 • Overtime claim was for May.

22/05/07 11824 82.76 • Overtime claim for May.

• Payment voucher missing.

approved.

• No indication of payment being authorised and approved.

14/06/07 11939 147.23 • Overtime claim for October 2006.

• No indication of payment being authorised and approved.

Total $2,860.23 The Department could not produce during the audit the approvals or justifications for the overtime.
The following anomalies were also noted: • The relevant payment vouchers have been misplaced.

• Some claims were for working overtime in 2006.

Audit question the need to work overtime when the scope of operation of the Department was drastically reduced in 2007.

The payments of overtime were unauthorised as prior approvals for working overtime were not obtained.

The missing payment vouchers to authenticate the accuracy and validity of the claims increases the risk of misappropriation of funds.
Recommendations • The Department should investigate and authenticate the validity of the overtime payments.

• The Department should ensure that no overtime works are carried out without prior approval from the Head of Department.

Management’s Comments FMIS has stated that manual vouchers are not necessary, since the system vouchers will be created directly from the invoice received and attached to the Cash Requirement report for approval by supervisor before payment process is done.
(Refer attachment 1 which is a copy of email).

However, vouchers generated through the system could be accessed and we are awaiting copies of these cheques from Colonial National Bank to sight the signatories on them.

Each copy of the cheque would cost us $5.00.

On overtime claims by Niko Nabitakale- we have checked the attendance register maintained by Accounts Section.

Officers working in the section were not signing out each afternoon.
Overtime file maintained by Registry in Administration has also been misplaced so we are unable to check whether prior approval was sought for the overtime work.

Legislature Department Section 11: Page 8 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 We have obtained cheques copies of overtime claims by Nacanieli Goneyali.

The signatories were Niko Nabitakale, Tajeshwar Datt and Amali Sauduadua.
They would be in a better position to advice on the calculation of hours claimed by each officer even though the departure time was not stated on the attendance register.
11.11 Over-Expenditure No officer may incur expenditure which results in the agency’s appropriation being exceeded without the proper authorisation of the Ministry of Finance, pending approval by Parliament.8 An analysis of the Expenditure Statement for the year ended 2007 revealed that the Department had over spent its annual budget allocation by $276,259 or 19%.
Refer to Table 11.6 for details: Table 11.6: Over-Expenditure by SEGs SEG Description Revised Provision Actual Expenditure Established Staff Unestablished Staff Travel and Communication Maintenance & Operation Purchase of Goods & Services Special Expenditure Value Added Tax Total Expenditure $ 453,016 328,871 52,000 236,500 40,000 234,641 140,100 1,485,128 $ 902,956 295,822 92,161 254,141 33,160 15,021 168,126 1,761,387 Variance Savings/(Over expenditure) $ (449,940) 33,049 (40,161) (17,641) 6,840 219,620 (28,026) (276,259) Variance Savings/(Over expenditure (%) (99.3) 10 (77.2) (7.5) 17.1 94.6 (20.0) (18.6) Numerous misallocations of expenditures were also noted.
Refer to Table 11.7 for examples: Table 11.7: Misallocations of Expenditures Date Journal Particulars 07/2007 AP 9508 Telephone Bill 06/2007 AP 8988 for Bills month of June the Amount ($) Was Posted To (Wrong Allocation) 2,559.53 Repair and Maintenance Vehicle – SEG 4 12,346.91 Repair and Maintenance – Building – SEG 4 Correct Allocation Communication (SEG 3) Communication (SEG 3) The over-expenditures and misallocations reflect ineffective management and control of public funds.
Recommendations • Management should ensure that the Department spends only what is appropriated.

• Expenditures should be reviewed against the budget on a monthly basis and additional provisions should be sought for any foreseen over-expenditures.

8 Finance Instructions 2005 Section 8 Legislature Department Section 11: Page 9 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Management Comments The Budget for 2007 was a “no Parliament Budget”.
However, full staff remained in the first quarter.

Movement of staff began in April.

Some officers who were transferred were brought back due to no vacancies in other Departments.

Then, again in October, November and December, transferred officers returned.

Misallocations of Telecom and FEA payments were due to exhaustion of funds.

Though there was no Parliament, we had other departments occupying space in our complex and utilizing these utilities.
The main Telecom line is used for making calls and they have not contributed funds for usage of electricity as well.

Virement applications were not done earlier as only two Temporary Relieving Clerical Officers were maintaining Accounts Section until 02/09/2007upon transfer of the Senior Accountant and Acting Accounts Officer on 20/06/2007 and 03/07/2007 respectively from the Department.

Virement applications were done for the November and December payments.
The first application was dispatched on 07/11/07, however it was misplaced.

We sent another one on 16/11/2007 and kept following it up with Suliasi (desk officer in Budget).We were advised on 15/01/2008 that the applications have been rejected by his superiors.

We were also advised then that no virement applications were accepted after the 31/12/2007 even though the Finance Circular number 21/2007 stated the closing date of virement applications as 01/02/2008.
If virement applications had been approved, we could have adjusted some of the misallocations.

We have noted the recommendations and will ensure that transactions are posted to the correct allocations and proper procedures are adhered when additional funds are needed to make payments.

The Department will also ensure that we operate within the approved budget.

11.12 Purchases and Payment Records All payments must be processed through payment vouchers prepared by the Voucher Clerk9.
The Voucher Clerk preparing a payment voucher must ensure that all information required under Finance Instruction 19(1) has been included on the payment voucher or attached to it, before passing it to the Senior Accounts Officer for certification.10 Immediately after payment has been effected the clerical officer must stamp paid on all vouchers and supporting documentation to avoid any double payment.11 All payment vouchers should be certified correct by a certifying officer before being processed for payment.12 Audit noted that the Department failed to process payments in accordance with section 19 of the Finance Instructions.
The following anomalies were noted: • • • • relevant supporting documents such as LPO, invoices, competitive quotations were not attached to the payment vouchers nor were they produced for audit purpose when requested; payment vouchers and supporting documents for January to August were not stamped ‘PAID’.

some payment vouchers had been misplaced; payments were processed on photocopied invoices.

Refer to Appendix 11.4 and Appendix 11.5 for details.
In the absence of payment vouchers and supporting documents, it is difficult for audit to authenticate the accuracy, reliability and validity of payments.

The failure to comply with the internal controls increases the risk of misappropriation of public funds.
9 Finance Manual 2005 Section 2.8.1 10 Finance Manual 2005 Section 2.8.2 11 Finance Manual 2005 Section 2.8.7 12 Finance Instructions 2005 19 (2) Legislature Department Section 11: Page 10 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Recommendations • The Department should ensure that the procedures in the Finance Instructions and the Finance Manual are strictly adhered to when processing payments of goods and services.
• The Ministry of Finance should conduct further investigations as there may have been a case of misappropriation of funds.

Management Comments Manual vouchers are not necessary since the system vouchers will be created directly from the invoice received and attached to the Cash Requirement report for approval by supervisor before payment process is done.
However, we are maintaining all manual vouchers effective from 03/09/2007and have ensured that procedures stated in the Financial Instructions and the Finance Manual is strictly adhered to when processing payments of goods and services.

Appendix 11.5: Missing Payment Vouchers We have written to Colonial National Bank to obtain copies of all cheques identified in the missing vouchers.
11.13 Exorbitant Telecommunication Expenditures Officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.
The proper management of expenditure is fundamental to ensuring value for money in delivering services to the community and having cost effective internal controls within the purchasing and payments system plays an important part in ensuring that wastage of funds and over expenditures do not occur.13 In 2007, the Department was appropriated $40,000 for telecommunications.

The Department incurred a total of $158,405 in telecommunication expenses resulting in an over-expenditure of $118,405 or 296%.
Refer to Table 11.8 for monthly breakdown of telecommunication expenses: Table 11.8: Monthly Telephone Expenses Months January February March April May June July August September October November December Total Amount $ 50,213.97 23,691.92 3,493.10 - - 30,464.28 11,602.09 12,802.60 7,618.29 5,313.28 6,171.13 7,034.59 158,405.25 The following anomalies, which could be contributing factor to the high telecommunication expenditures, were noted: 13 Finance Manual 2005 Part 2 Legislature Department Section 11: Page 11 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 • telephone bills were not thoroughly vetted to ascertain their accuracy and to determine unofficial calls; there were no evidences of officers reimbursing charges for personal calls; • • high number of calls were made to mobile phones; • there were a number of international calls.
The former Secretary General’s also incurred mobile phone bills amounting to $2,404.57 for January 2007 against her annual entitlement of $1,200.

Of the total charges for January, international calls amounted to $1,707.

Audit question the high telecommunication expenses incurred by the Department in light of its reduced operations in 2007.

Failure to implement stringent controls with regards to telephone usage could result in misuse and abuse of public funds.
Recommendations • The Department should scrutinise all telephone bills in 2007 and charges for unofficial calls should be refunded by the relevant officers.

• The Department should introduce stringent policies to control its telecommunication expenses.
Management Comments Though we had reduced operation in 2007, the Telecom expenditure remained high as we had other Departments namely Investigation into the Fijian Institution Team, National Council of Building a Better Fiji, Great Council of Chiefs Review Team and Technical Assistance and Support Secretariat staff occupying office space in our complex and utilizing our main line without making payments for the facility.
It should be noted that $50,213.97 paid in January 2007 was for period 30/11/2006 to 30/12/2007 due in January 2007.

The total payment done in 2006 for Telecom was $225, 270.49.

Payments made in 2007 had reduced by 30% and if $50,213.97(December 2006 bill) was deducted, our expenditure on Telecom would be just 39% of 2006 expenses.
11.14 Outstanding Accountable Advance Officers may be given accountable advance with the prior approval of the Chief Accountant for the purpose of covering expenses whilst travelling on duty.
Within seven days of completion of the duty for which advance were issued, the Officer shall submit a statement of expenses to the Chief Accounting Officer so that the advance may be cleared.14 If the advances have not been cleared within seven days, the outstanding amount together with interest should be recovered from the Officer’s salary.15 Several accountable advances that have been outstanding for a period of time and have yet to be cleared.
Refer to Table 11.9 for examples: 14 Finance Instruction 51 (3) 15 Finance Circular 22/85 Legislature Department Section 11: Page 12 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Table 11.9: Outstanding Accountable Advance Name EDP S.Wainiu Serei Naicavu Marilyn Korovusu Kelera Sagoa Asena Nasegai Kalo Takape Former Secretary General Total 49867 48443 63796 46878 48583 47493 Amount Outstanding $ 768.40 1,250.00 330.00 602.50 445.00 32.00 161.31 20.00 515.00 1,259.11 $5,383.32 The relevant officers explained that they have retired the accountable advances, but there were no documentary evidence available to authenticate that the advances had been cleared.
The non- clearance of accountable advances is an issue that has been raised continually over the years.

Recommendations • The Department should ensure that accountable advances are cleared within seven days.

• The Department should recover outstanding advances from the relevant officers’ salaries.

Management Comment The officers who have outstanding accountable advances in their names have stated that they have cleared them with former Acting Accounts Officer, Tajeshwar Datt.
We have a number of correspondences relating these advances but Tajeshwar Datt has failed to provide any explanations.
Legislature Department Section 11: Page 13 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Appendix 11.1: Statement of Output Costs Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Special Expenditures Operating Grants & Transfers Total Operating Costs Capital Expenditure Capital Purchases Total Capital Expenditure 2007 $ 2006 $ 902,956 295,822 92,161 254,141 33,160 0 15,021 1,593,261 5,551,157 667,954 1,324,294 629,271 904,862 40,557 250,851 9,368,946 0 0 7,168 7,168 Value Added Tax 168,126 1,060,701 TOTAL EXPENDITURE 1,761,387 10,436,815 Legislature Department Section 11: Page 14 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Appendix 11.2: FNPF Reconciliation Description (a) Total FNPF against salaries and wages for 2007 FNPF as per financial statement Less: FNPF for December 2006 Add: FNPF for December 2007 Gross pay subject to FNPF ($22,426 divided by 0.08) (b) Salaries and wages for 2007 subject to FNPF: Salaries, wages and allowances as per financial Statement Less: Salaries, wages and allowances not subject to FNPF Salaries, Wages & Allowances for 2007 Subject to FNPF Variance $ 168,938 146,512 22,426 - 22,426 280,325 1,029,839 - 1,029,839 $749,514 Appendix 11.3: VAT Reconciliation Description Total income/expenditure as per Statement of Receipts and Expenditure Less: Expenditure not subject to VAT Less: Total taxable supplies as per VAT Returns Un-reconciled variance $ 1,761,387 - 1,761,387 1,576,031 185,356 A variance was also noted between the actual VAT payments for 2007 and the balances disclosed in the general ledger (FMIS) as follow: Description VAT payments (VAT payments to FIRCA and VAT Input) as per Statement of Receipts and Expenditure VAT payments (VAT payments to FIRCA and VAT Input) as per VAT Returns for 2007 Un-reconciled variance $ 168,126 175,115 (6,989) Legislature Department Section 11: Page 15 REPORT OF THE
 AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Appendix 11.4: Anomalies in Payments Payee Anomaly Date 02/01/07 08/01/07 09/01/07 Chq Number 11125 11157 11162 Dans Service Station Dans Service Station VT Solution 11/01/07 11180 Bondwell Computers 11/01/07 11182 Rons General Repairs 11/01/07 11181 Dans Service Station 16/01/07 11208 Rons General Repair 02/02/07 11319 Vinod Patel 19/02/07 11383 Telecom Fiji 21/02/07 11393 FEA 02/03/07 11440 Isoa Kakili 06/03/07 11453 Matereti Sarasau 07/03/07 11471 Mass Stationery 07/03/07 14/03/07 15/03/07 11472 11489 11506 Principal Engineer Mass Stationery Kaks Marketing 15/03/07 11509 Poly Products 15/03/07 15/03/07 11514 11516 Mechanical Services Initial 22/03/07 11553 Malani Laufitu 05/04/07 11613 05/04/07 11619 Marketing Stationery Vinod Patel Office 05/04/07 25/04/07 11621 11704 Kuar Singh Rons General Repair 01/05/07 11717 Pest Kill 01/05/07 02/05/07 02/05/07 11719 11725 11727 Dick Smith Kaks Marketing Nivis Motor • No LPO and invoice sighted • No LPO and invoice sighted • No payment voucher, LPO sighted and competitive Quotation sighted Payment voucher and supporting documents not sighted.


Payment voucher and supporting documents not sighted.

Payment voucher and supporting documents not sighted.

Payment voucher and supporting documents not sighted.

• No bills/invoice sighted • Incomplete payment voucher.

• No bills/invoice sighted • Incomplete payment voucher.

Payment voucher and supporting documents not sighted.

• Incomplete payment voucher.

• No supporting documents sighted • Manual Payment voucher was not prepared.
• LPO was issued only for $405 • Outstanding account payment $1,005.

Manual Payment voucher was not prepared Incomplete payment voucher Payment voucher and supporting documents not sighted.

Payment voucher and supporting documents not sighted.

Manual Payment voucher was not prepared Payment voucher and supporting documents not sighted.

Payment voucher and supporting documents not sighted.
Manual Payment voucher was not prepared Amount $ 300.00 90.80 1,125.00 237.04 389.50 146.50 320.75 776.79 18,474.26 9,153.05 678.57 2,321.30 1,410.00 370.81 669.96 1,203.75 900.00 2,050.00 4,301.28 2,497.33 390.08 • Payment voucher and supporting 1,060.26 documents not sighted.

• Photocopies invoice used for payments.

Manual Payment voucher was not prepared Payment voucher and supporting documents not sighted.

Payment voucher and supporting documents not sighted.
Manual Payment voucher was not prepared Manual Payment voucher was not prepared voucher • Payment supporting and 229.11 272.31 225.00 587.82 1,070.33 290.00 Legislature Department Section 11: Page 16 documents not sighted.

• Photocopies invoice used for payments.


REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Date 09/06/07 24/05/07 08/06/07 05/07/07 Chq Number 11771 11842 11913 12030 Payee Anomaly Kaks Marketing Avi Natural Choice Avi Natural Choice Rons General Repairs Manual Payment voucher was not prepared Payment voucher and supporting documents not sighted.

Manual Payment voucher was not prepared voucher • Payment supporting and documents not sighted.
04/09/07 12237 Professional Stationery 04/09/07 12238 Remington • Photocopies invoice used for payments.

voucher • Payment and supporting documents not sighted.

• Photocopies invoice used for payments.

Payment voucher and supporting documents not sighted.
Amount $ 960.00 506.25 961.88 180.00 145.00 398.00 Legislature Department Section 11: Page 17 REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Appendix 11.5: Examples of Missing Payment Vouchers Date Chq Number Payee 02/02/07 02/02/07 02/02/07 02/02/07 02/03/07 08/03/07 08/03/07 09/03/07 09/03/07 09/03/07 12/03/07 16/03/07 16/03/07 16/03/07 16/03/07 22/03/07 23/03/07 23/03/07 23/03/07 23/03/07 23/03/07 23/03/07 29/03/07 30/03/07 30/03/07 12/04/07 12/04/07 24/04/07 26/04/07 27/04/07 30/04/07 09/05/07 11/05/07 17/05/07 23/05/07 25/05/07 31/05/07 31/05/07 06/06/07 08/06/07 11/06/07 15/06/07 22/06/07 22/06/07 28/06/07 02/07/07 06/07/07 13/07/07 19/07/07 26/07/07 31/07/07 Legislature Department Section 11: Page 18 Lusi Bale Maraia Vola Sera Tauvoli Secretary General Nacanieli Goneyali Secretary General Maikeli Nalatu Sefanaia Semira Manasa Nukuvou Nacanieli Goneyali Kemueli Qio Manasa Nukuvou Maikeli Nalatu Ilaisa Naviau Jeus Landscape Telecom Fiji FEA Maikeli Nalatu Sefanaia Manasa Nukuvou Jeus Landscape Nacanieli Goneyali LincolnRefridgeration Maikeli Nalatu Secretary General Narendra Padrath Ratu Kinijoji Ramasi Secretary General Atunaisa Bulivou Secretary General Principal Engineer Joe Hughes Nacanieli Goneyali Manasa Nukuvou Asesela Sadole Secretary General Atunaisa Bulivou FEA Jain Kumar Niko Nabitakele Niko Nabitakele Secretary General Narendra Padarath Secretary General FEA Mesale Rokotabuivalu Maikeli Nalatu Amjad Ali Narendra Padarath Ratu Kinijoji Ramasi Sera Tawai Amount $ 11559
REPORT OF THE AUDITOR-GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS -- OCTOBER 2008 Date Chq Number Payee 09/08/07 09/08/07 20/08/07 12155 12156 12184 Niko Nabitakele Vani Randelanimati Ratu Kinijoji Ramasi Amount $ 1,678.77 433.54 3,239.02 Legislature Department Section 11: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 12 Office of the Ombudsman Programme Statement The Ombudsman is primarily a guardian for the general public in their relations with the Civil Service, statutory bodies and local governments.
His/her duty is to receive complaints against the above bodies where administrative malfeasance is alleged and to investigate them.

But he/she can also protect authorities against unwarranted criticism.

The Ombudsman’s Office is designed to obtain remedies in a cheap, informal and expeditious manner and to see that powers are not exceeded or abused.

The Ombudsman is entitled to recommend improvements in practice, procedure or law.
Table of Contents 12.1 12.2 12.3 12.4 12.5 FINANCIAL STATEMENT ..................................................................................................................... 1 Audit Opinion ............................................................................................................... 1 Statement of Receipts and Expenditures ..................................................................... 2 Statement of Output Costs........................................................................................... 2 Appropriation Statement .............................................................................................. 2 Statement of Losses .................................................................................................... 3 AUDIT FINDINGS ................................................................................................................................. 4 12.6 Motor Vehicle Entitlement ............................................................................................ 4 VAT Reconciliation ...................................................................................................... 4 12.7 Preparation of Monthly Reconciliations ........................................................................ 5 12.8 Appendix 12.1: Statement of Output Costs.............................................................................. 7 Appendix 12.2: VAT Reconciliation.......................................................................................... 7 FINANCIAL STATEMENT 12.1 Audit Opinion The audit of the 2007 accounts of the Office of the Ombudsman resulted in the issue of a qualified audit report.
The Office had consolidated its expenditures into one Statement of Output Costs, whereas the Budget Estimates 2007 prescribes five outputs.

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

It is not possible therefore to express an opinion on the accuracy of the expenditures incurred by the Office under each output.
Office of the Ombudsman Section 12: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 12.2 Statement of Receipts and Expenditures The Office incurred a total expenditure of $1,386,669 in 2007 compared to $1,454,244 in 2006.

Refer to Table 12.1 for details.
Table 12.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS Agency Revenue TOTAL REVENUE EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Expenditures Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 0 0 863 863 333,362 20,407 8,659 28,805 25,039 912,703 - 1,328,975 377,432 34,750 12,315 23,607 337 958,422 - 1,406,863 - - - - - - - - Value Added Tax 57,694 47,381 TOTAL EXPENDITURES 1,386,669 1,454,244 12.3 Statement of Output Costs The Statement of Output Costs consolidates the 5 outputs prescribed in the Budget Estimates, contrary to Finance Instructions 81.
These are detailed in Appendix 12.1.

12.4 Appropriation Statement The Office incurred expenditures totalling $1,386,669 in 2007 against the budget of $1,421,572 resulting in a savings of $34,903 or 2%.

Details of expenditures against the budget estimates are provided in Table 12.2.
Office of the Ombudsman Section 12: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 12.2: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase Services Operating Grants & Transfers Special Expenditures Total Operating Costs of Goods & Capital Expenditure Capital Construction Capital Purchases Capital Grants and Transfers Total Capital Expenditure Budget Estimate $ Changes $ 334,187 40,967 14,500 32,300 28,793 914,524 (4,000) 4,000 Revised Estimate $ 334,187 40,967 10,500 36,300 28,793 Actual Expenditure $ 333,362 20,407 8,659 28,805 25,039 914,524 912,703 - 1,365,271 - 1,365,271 - 1,328,975 0 - - - - - - - - - - - - 13 Value Added Tax 56,301 56,301 57,694 TOTAL EXPENDITURE 1,421,572 0 1,421,572 1,386,669 Carry – Over $ Lapsed Appropriation $ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 825 20,560 1,841 7,495 3,754 1,821 - 36,296 - - - - (1,393) 34,903 The Ministry of Finance approved a transfer of $4,000 from SEG 3 Travel and Communication to SEG 4 Maintenance & Operations during the year because of foreseen over expenditures.
However, this was not necessary as the original budget was sufficient to cover all SEG 4 expenditures.

12.5 Statement of Losses Office equipment valued at $4,616 was stolen from the Office on 25/06/07.

Copies of Loss Reports have been submitted to the Public Service Commission and Ministry of Finance.

Police investigation is in progress.

Refer Table 12.3 for details.
The details of the stolen office equipment are as follows: Table 12.3: Statement of Losses for 2007 Item Quantity HP Coloured Printer (LaserJet 2550L HP Scanner (ScanJet 4070) Digital Camera (Cyber – shot ) Laser Jet Printer Total Value 1 1 1 1 Value $ 1,214 264 999 2,139 4,616 Office of the Ombudsman Section 12: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 AUDIT FINDINGS 12.6 Motor Vehicle Entitlement The Public Service Commission has approved that Chief Executive Officers be entitled to the use of designated official government vehicles for limited private use, to commute daily from home to work in the morning and from work to home in the afternoon and that such travel to be within ten (10) kilometres boundary limit.1 The acting Ombudsman utilised the official vehicle to commute daily to and from his residence to work with the mileage exceeding the 10 kilometres boundary limit.
Refer to Table 12.4 for examples: Table 12.4: GM991 – Mileage Exceeding 10km Month January February March April May June July August Total Trip Mileage (km) 794 731 757 703 472 493 500 273 4,723 Amount ($) (45 cents per km) 357.30 328.95 340.65 316.35 212.40 221.85 225.00 122.85 2,125.35 Also, the Office has yet to recover the cost of mileage amounting to $1,530 incurred by the acting Ombudsman (Principal Investigation Officer) for using the official vehicle for commuting to and from his residence to work.
The above indicate abuse of official vehicle, and this could result in increased operating expenses if not effectively controlled.

Recommendations The cost of mileage utilised for transporting the acting Ombudsman to and from his residence to work should be immediately recovered through direct salary deductions.

Management Comments The Ombudsman’s use of official care is covered by the contract with the Constitutional Offices Commission and not under Chief Executive Officers’ contract.
12.7 VAT Reconciliation Subject to the provision of the Vat Decree 1991, the tax shall be charged in accordance with the provisions of the Decree at the rate of twelve and a half percent on the supply (but not including an 1 PSC Letter- Chief Executive Officers Entitlement to Limited Private use of Official Vehicle- Reference : C29/450/25 (11)- 1 &2 Office of the Ombudsman Section 12: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 exempt supply) in Fiji of goods and services, by a registered person in the course or furtherance of a taxable activity carried on by that person, by reference to the value of that supply.2 A review of VAT Returns, supporting documents and VAT reconciliations revealed an un-reconciled balance of $18,119 between the taxable supplies in the VAT Returns and the total income/expenditures in the Statement of Receipts and Expenditure.
Refer to Appendix 12.2 for details.

The Office did not provide any explanations for the variance during the audit.

Recommendations • The Office should review its VAT records and reconciliations and provide explanations for the variances.

• Supervisory checks on the preparation of VAT Returns should be improved to ensure that balances reflected in the VAT Returns reconcile with the general ledger.
Management Comments Supervisory checks on the preparation of VAT Returns will be done to ensure that the balances reflected reconcile with the GL.

We will also reconcile our records with the GL before processing VAT payments.

As of this year we will prepare our monthly vat reconciliations so our total expenditure matches with our VAT Returns.
12.8 Preparation of Monthly Reconciliations When invoices or claims for payment are received, the Assistant Accounts Officer shall record details in an accounts payable ledger.

The accounts payable ledger shall record claims for payment except for procurement invoices.3 Within 3 days of receiving the monthly general ledger reports from the Ministry of Finance, the Assistant Accounts Officer shall reconcile the ledger balances to the general reports and prepare a ledger reconciliation statement.
Any errors or misallocation must be immediately adjusted by way of journal vouchers.4 The Office of the Ombudsman failed to maintain records of its Operating Trust Fund and Revolving Fund accounts consequently the reconciliations were not prepared.

Previously, records were maintained by the Office of the Prime Minister, however, when the new financial management information system came into effect on 1/08/05, the Office is required to maintain its own records and carry out monthly reconciliations.
As a result, audit could not substantiate the accuracy of the balance of Operating Trust Fund and Revolving Fund reflected in Appendices 19 and 23B of the Accounts and Finance.

The issue has been continuously highlighted in the audit report of the Office over the years.

Recommendations • The Office should maintain its own Operating Trust Fund and Revolving Fund records and prepare monthly reconciliations.
2 Value Added Tax Decree 1991 4th edition revised to 30/04/04 – section 15 (1) 3 Office of the Ombudsman’s Finance Manual 13.1.1 4 Office of the Ombudsman’s Finance Manual 16.3.7 – 16.3.8 Office of the Ombudsman Section 12: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • Disciplinary action is recommended for the Assistant Accounts Office for failing to comply with the requirements of the Finance Instructions.
Management Comments “At the beginning of this year the Assistant Accounts Officer spoke with Iminoni FMIS (Ministry of Finance) regarding our trust fund reconciliation.

He was advised that we have not done our reconciliations for last year since we have only four accounts with not much balance and if we could start submitting our reconciliation this year.
This he agreed to and we have submitted our reconciliations for this year till the month of May.” Office of the Ombudsman Section 12: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 12.1: Statement of Output Costs Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Costs Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Costs 2007 $ 2006 $ 333,362 20,407 8,659 28,805 25,039 912,703 - 1,328,975 377,432 34,750 12,315 23,607 337 958,422 - 1,406,863 - - - - - - - - Value Added Tax 57,694 47,381 TOTAL EXPENDITURE 1,386,669 1,454,244 Appendix 12.2: VAT Reconciliation Description Total expenditure/income as per Expenditure Statement Less: Expenditure not subject to VAT – Operating Grant Total expenditure/income subject to VAT Less: Total taxable supplies as per VAT Returns Un-reconciled variance $ 1,386,669 912,703 473,966 455,847 18,119 Office of the Ombudsman Section 12: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 13 Office of the Director of Public Prosecution Programme Statement The Office of the Director of Public Prosecutions is responsible for prosecuting appeals before the Fiji Court of Appeal and the Supreme Court.
In addition, all High Court trials are prosecuted by State Counsels who also handle appeals to the High Courts at Suva, Lautoka and Labasa.

Cases of special difficulty or of public interest in the Magistrates Court are handled by the Director of Public Prosecutions Office.
Other significant works of the department includes the determination of complaints against police and prison officers, the provision of written advice to the Commissioner of Police, the Director C.I.D and to other government departments and statutory organisations.

The Director also considers written representations concerning criminal cases from aggrieved persons, defendants or from their counsels.
Table of Contents 13.1 13.2 13.3 13.4 13.5 13.6 FINANCIAL STATEMENT ..................................................................................................................... 1 Audit Opinion ............................................................................................................... 1 Statement of Receipts and Expenditures ..................................................................... 2 Statement of Output Costs........................................................................................... 2 Appropriation Statement .............................................................................................. 2 Statement of Losses .................................................................................................... 3 Trust Account Statement of Receipts and Payments ................................................... 3 AUDIT FINDINGS ................................................................................................................................. 4 Agency Financial Statements....................................................................................... 4 13.7 VAT Reconciliation ...................................................................................................... 5 13.8 FNPF Reconciliation .................................................................................................... 5 13.9 Appendix 13.1 – Statement of Output Cost for 2007................................................................. 7 FINANCIAL STATEMENT 13.1 Audit Opinion The audit of the 2007 accounts of the Office of Director of Public Prosecution resulted in the issue of a qualified audit report.
The accounts were qualified as the amounts reflected in the Statements of Output Costs have been estimated since the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

It is not possible therefore to determine the accuracy of the expenditures incurred by the Office under each output.
Office of the Director of Public Prosecution Section 13: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 13.2 Statement of Receipts and Expenditures The Office incurred a total expenditure of $3,721,728 in 2007 compared to $3,288,097 in 2006.
Table 13.1: Statement of Receipts and Expenditures for 2007 Description EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 2,456,368 2,247,646 43,506 176,615 159,306 153,576 - 138,482 3,193,594 2,919,131 49,967 188,021 154,694 257,189 - 87,355 - 94,852 - 94,852 - 0 - 0 Value Added Tax 433,282 368,966 TOTAL EXPENDITURES 3,721,728 3,288,097 13.3 Statement of Output Costs The Office of the Director of Public Prosecution has 2 outputs, as prescribed in the Budget Estimates 2007.
These are detailed in Appendix 13.1.

13.4 Appropriation Statement The Office of the Director of Public Prosecution incurred expenditures totalling $3,721,728 in 2007 against the budget of $3,896,565 resulting in a savings of $174,837 or 4%.

Details of expenditures against the budget estimates are provided in Table 13.2.
Table 13.2: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Budget Estimate $ 2,433,234 51,996 201,000 180,000 307,716 0 Changes $ Revised Estimate $ Actual Expenditure $ Carry – Over $ 2,433,234 51,996 201,000 190,463 292,853 0 2,456,368 49,967 188,021 154,694 257,189 0 0 0 0 0 0 0 10,463 (14,863) Lapsed Appropriation $ (23,134) 2,029 12,979 35,769 35,664 0 Office of the Director of Public Prosecution Section 13: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 SEG Item 7 8 9 10 Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Purchases Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Changes $ (4,400) 4,400 4,400 Budget Estimate $ 150,000 3,323,946 0 139,667 0 139,667 432,952 Revised Estimate $ 150,000 3,319,546 Actual Expenditure $ 87,355 3,193,594 0 144,067 0 144,067 0 94,852 0 94,852 432,952 433,282 TOTAL EXPENDITURE 3,896,565 0 3,896,565 3,721,728 The Ministry of Finance approved the following transfer of funds during the year: Carry – Over $ Lapsed Appropriation $ 0 0 0 0 0 0 0 0 62,645 125,952 0 49,215 0 49,215 (330) 174,837 a) $10,463 from SEG 5 Purchases of Goods & Services to SEG 4 Maintenance & Operations.
b) $4,400 from SEG 5 Purchases of Goods & Services to SEG 9 Capital Purchases.

However, the transfers were not necessary as the original budgets under the two allocations were sufficient to cover all expenditures.

13.5 Statement of Losses The Office did not record any loss of fixed assets or money during the year.

Stocktake of assets was carried out in August 2007 for all stations of the Office of the Director of Public Prosecutions.
The Office has yet to receive any response from the Ministry of Finance for request of write-offs of unserviceable assets.

13.6 Trust Account Statement of Receipts and Payments The Office of the Director of Public Prosecution on 17/04/07, receipted $1,041 from the sale of exhibits of a vessel (forfeited assets) where government is a beneficiary.

The case is pending in Court.
The details of the forfeited assets are as follows: Table 13.3: Statement of Receipts and Payments – Forfeited Assets Description Receipts Forfeited Assets Total Receipts Payments Closing Balance 2007 $ 1,041 1,041 - 1,041 Office of the Director of Public Prosecution Section 13: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 AUDIT FINDINGS 13.7 Agency Financial Statements Commencing 2006 financial year, each annual report must include financial statements which are prepared and signed in accordance with the Finance Instructions, audited by the Auditor - General, and accompanied by an audit opinion prepared by the Auditor - General.1 The draft financial statements must be submitted to the Auditor – General by 31 March in the following year, or within such other time as agreed to with the Auditor – General.2 The Office of the Director of Public Prosecutions submitted its Financial Statements for audit on 31/03/08.
Audit could not substantiate the balances reflected in the Statements of Output Costs as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

The above issues will be used as basis of qualifications of the financial statements.

Recommendations • The Office should ensure that the requirements of the Finance Instructions 82 are strictly followed in the preparation of the Financial Statements.
• Virement of funds from one SEG to another should only be made when there is a shortfall which could not be catered from the approved budget for that particular SEG.

Management Comments • Expenditure incurred as at December 2007 for each allocation was inserted in the template designed by Ministry of Finance – Budget Division and this reflects the Output Costs 1 and 2 as intergraded by FMIS.
• Virement 01/2007 – Repair of Office Building-Gunu House - $7,620.00 This is a new allocation in which no funds provided in the Budget Estimates 2007.

Request has to be made to FMIS and Budget Division for the creation of this new allocation, upon approval virement was prepared to release fund from SEG 5 – Supreme Court Witness to SEG 4- Repair of Office Building Gunu House.
Virement 02/2007 – Repair of Office Vehicle -$1,429.00 Reason for the virement made is that there is not sufficient fund in the cash flow for the month of June to cater for the repairs of office vehicle.

Virement was prepared to release fund from SEG 5 – Supreme Court Witness to SEG 4- Spare Parts and Maintenance.

Virement 03/2007 – Maintenance of Office Equipment $1,414.00 This is totally new allocation in which no funds provided in the Budget Estimates 2007 - Maintenance of Photocopy Machine.
Request has to be made to FMIS and Budget Division for the creation of this new allocation, upon approval virement was prepared to release fund from SEG 5- Supreme Court Witness to SEG 4 – Maintenance of Office Equipment.

Virement 04/2007 - Purchase of New Photocopy Machine - $4,400.00 This is totally new allocation in which no funds provided in the Budget Estimates 2007 – Purchase of New Photocopy Machine.
Request has to be made to FMIS and Budget Division for the creation of this new 1 Finance Instructions 2005 – 81 (2) 2 Finance Instructions 2005 – 81 (3) Office of the Director of Public Prosecution Section 13: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 allocation, upon approval virement was prepared to release fund from SEG 5- Supreme Court Witness to SEG 9 – Purchase of New Photocopy Machine ( Capital Purchase).
13.8 VAT Reconciliation Subject to the provision of the Vat Decree 1991, the tax shall be charged in accordance with the provisions of this Decree at the rate of twelve and a half percent on the supply (but not including an exempt supply) in Fiji of goods and services, by a registered person in the course or furtherance of a taxable activity carried on by that person, by reference to the value of that supply.3 A review of VAT Returns, supporting documents and VAT reconciliations carried out during the audit revealed an un-reconciled balance of $12,581 between the taxable supplies as per VAT Return and the total income/expenditure as per the Statement of Receipts and Expenditure.
Refer below for details: Table 13.4: Details of Un-reconciled balance Details Total income/expenditure as per Statement of Receipts and Expenditure Add: VAT paid in November not fully accounted in the GL Less: Total taxable supplies as per VAT Returns Un-reconciled variance $ 3,721,728 5,322 3,727,050 3,739,631 (12,581) In addition, VAT Input as per VAT Returns totalled $59,114 whereas the general ledger recorded VAT input of $64,653 resulting in a difference of $5,539.
Recommendations • The Office should review its VAT records and reconciliations and provide explanations for the variances.

• Supervisory checks on the preparation of VAT Returns should be improved to ensure that balances reflected in the VAT Returns reconcile with the general ledger.

Management Comments • Payment of VAT for 2007 was made in accordance with balance reflected in the monthly GL ie.

1/9 of total expenditure less INPUT VAT for the month equals to VAT PAYABLE (OUTPUT).
• VAT records were accessible to the audit officer during the audit and we do not see any reasons for the variances since we only work out the VAT payable from the figures derived from the monthly GL Report given from the Ministry of Finance.

• We acknowledge these audit variances and will rectify these issues in accordance with your format in future.
13.9 FNPF Reconciliation Every employer shall pay to the Fund in respect of each of his employees, in every month during which such employee by him and in the month following the termination of such employment, a contribution calculated upon the amount of wages payable to such employee by such employer for the preceding month at the appropriate rates.4 3 Value Added Tax Decree 1991 4th edition revised to 30/04/04 – section 15 (1) 4 Chapter 219 – Fiji National Provident Fund – Section 13 (1) Office of the Director of Public Prosecution Section 13: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 A reconciliation of FNPF contributions against salaries and wages reported in the Financial Statements revealed variances as follows: Table 13.5: Details of FNPF Variances Details (a) Total FNPF against salaries and wages for 2007 FNPF as per financial statement Add: FNPF for December 2007 Less: FNPF for December 2006 FNPF for 2007 Gross pay subject to FNPF (201,760 divided by 0.08) (b) Salaries and wages for 2007 subject to FNPF: Salaries, wages and allowances as per financial Statement Less: Salaries and wages not subject to FNPF Salaries, wages and allowance for 2007 subject to FNPF Variance Recommendation $ 201,488 18,035 219,523 17,763 201,760 2,522,000 2,304,847 - 2,304,847 217,153 The Office should review its FNPF records and reconciliations and provide explanations for the variances.
Management Comments • • Payments of FNPF Monthly Contributions are derived from the Contribution Schedule Report (CSR) from the Ministry of Finance after it has been reconciled with our records.

We cannot ascertain any explanation for the variance since monthly payment was done in accordance with the figures derived from the CSR from the Ministry of Finance.
Office of the Director of Public Prosecution Section 13: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 13.1 – Statement of Output Cost for 2007 Portfolio Leadership, Policy Advise and Secretariat Support Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Costs Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Costs Value Added Tax TOTAL COSTS 2007 $ 2006 $ 24,569 500 1,881 1,538 2,572 - 874 31,934 - 949 - 949 22,476 436 1,766 1,593 1,535 - 1,385 29,191 - 0 - 0 4,332 3,649 37,215 32,840 Prosecution of Suspected Offenders Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Costs Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Costs 2007 $ 2006 $ 2,431,799 49,467 186,140 153,156 254,617 - 86,481 3,161,660 2,225,170 43,070 174,849 157,713 152,041 - 137,097 2,889,940 - 93,903 - 93,903 - 0 - 0 Value Added Tax 428,950 365,317 TOTAL EXPENDITURE 3,684,513 3,255,257 Office of the Director of Public Prosecution Section 13: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 14 Department of Justice, Prisons and Corrections Programme Statement - Justice The Department of Justice is responsible for the efficient and effective delivery of services relating to all the Registries.
Justice Department will be the point of contact for all those requiring registration of properties, stamp duty, and Company registration.

Programme Statement – Prisons and Corrections The Fiji Prisons Service is responsible for the safe, secure and humane treatment of persons in custody by providing opportunities to correct offending behaviour, develop work and life skills and perform community service.
Under the framework of the Fiji Prisons Act and Public Service Administrative Guidelines, the Fiji Prisons Service works towards enhancing the quality of custodial responsibilities, improve inmate rehabilitation programmes, developing human recourses, effective use of resources and modernizing the service.
Table of Contents 14.1 14.2 14.3 14.4 CONCOLIDATED FINANCIAL STATEMENT........................................................................................ 2 DEPARTMENT OF JUSTICE ................................................................................................................ 2 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditure....................................................................... 3 Statement of Output Costs........................................................................................... 3 Appropriation Statement .............................................................................................. 3 AUDIT FINDINGS ................................................................................................................................. 4 14.5 Revolving Fund Account .............................................................................................. 4 VAT Reconciliation ...................................................................................................... 5 14.6 14.7 Retaining of Trust Funds – Official Receiver................................................................ 6 Liquidation Bank Reconciliation - Official Receiver ...................................................... 7 14.8 Follow up of Issues Raised in Previous Audits – 2006 ................................................. 9 14.9 DEPARTMENT OF PRISONS AND CORRECTIONS ......................................................................... 12 FINANCIAL STATEMENT ................................................................................................................... 12 14.10 Audit Opinion ............................................................................................................. 12
12 14.11 Statement of Receipts and Expenditure..................................................................... 12 14.12 Statement of Output Costs......................................................................................... 13 14.13 Appropriation Statement ............................................................................................ 13 14.14 Statement of Losses .................................................................................................. 14 AUDIT FINDINGS ............................................................................................................................... 14 14.15 Financial Statements ................................................................................................. 14 14.16 Over-Expenditure....................................................................................................... 15 14.17 Revolving Fund Account - Suspense ......................................................................... 15 14.18 Drawings Account ...................................................................................................... 16 Department of Justice, Prisons and Corrections Section 14: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 14.19 VAT Reconciliation .................................................................................................... 17 14.20 FNPF Reconciliation .................................................................................................. 17 14.21 Unsafe work environment - Suva Prison Administration Block................................... 18 14.22 CCTV Equipment ....................................................................................................... 18 Appendix 14.1: Statement of Output Costs for 2007 – Department of Justice ........................ 21 Appendix 14.2: Unreconciled VAT Variances ......................................................................... 21 Appendix 14.3: Statement of Output Costs for
 2007- Prisons Department ............................. 22 Appendix 14.4: Output Costs Variances for 2006 ................................................................... 23 Appendix 14.5: Bank Credits not taken into account in the Cash Book.................................. 24 Appendix 14.6: Bank debits not accounted in the Cash Book................................................. 24 Appendix 14.7: Lodgements not credited by the bank ........................................................... 24 Appendix 14.8: Details of FNPF Reconciliations.................................................................... 25 CONCOLIDATED FINANCIAL STATEMENT The Department of Justice and the Prisons and Corrections Department have not consolidated their financial statements as required.
DEPARTMENT OF JUSTICE FINANCIAL STATEMENT 14.1 Audit Opinion The audit of the 2007 accounts of the Department of Justice resulted in the issue of a qualified audit report.

The qualifications are as follows.

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

It is not possible therefore to determine the accuracy of the expenditures incurred by the Ministry under each output.
• The Department of Justice has not provided for audit a Statement of Losses and a Trust Fund Account Statement of Receipts and Payments, contrary to Finance Instructions 82.

The Financial Management Information System shows that the Department as at 31/12/07 has operating trust funds totalling $38,357.

• The payments of VAT could not be reconciled to the accounts.
Department of Justice, Prisons and Corrections Section 14: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 14.2 Statement of Receipts and Expenditure The Department of Justice incurred a total expenditure of $2,096,877 in 2007 compared to $2,359,277 in 2006.

Refer Table 14.1 for details.
Table 14.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Stamp Duty Miscellaneous Fees Registration Fees License Fees Other State Revenue Total State Revenue Agency Revenue Other Agency Revenue 2007 $ 2006 $ 14,019,394 709,681 339,688 27,812 138,140 15,234,715 18,056,661 807,458 412,446 24,810 154,675 19,456,050 5,145 4,372 TOTAL REVENUE 15,239,860 19,460,422 EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure 1,439,117 83,424 79,829 213,325 12,428 5,000 50,347 1,883,470 1,736,161 72,741 94,595 167,895 11,344 5,000 11,914 2,099,650 Value Added Tax 213,407 259,577 TOTAL EXPENDITURE 2,096,877 2,359,227 14.3 Statement of Output Costs The Department of Justice’s Statement of Output Costs consolidates the 2 outputs as prescribed in the Budget Estimates, contrary to the requirements of Finance Instructions.
These are detailed in Appendix 14.1.

14.4 Appropriation Statement The Department incurred expenditures totalling $2,096,877 in 2007 against the budget of $2,120,313 resulting in a savings of $23,436 or 1%.

Details of expenditures against the budget estimates are provided in Table 14.2.
Department of Justice, Prisons and Corrections Section 14: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 14.2: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs 13 Value Added Tax Changes $ 23,222 (23,222) 31,195 (21,622) (9,573) 0 Budget Estimate $ 1,409,536 105,158 80,000 191,500 34,119 5,000 60,000 1,885,313 235,000 Revised Estimate $ Actual Expenditure $ Carry – Over $ Lapsed Appropriation $ 1,432,758 81,936 80,000 222,695 12,497 5,000 50,427 1,885,313 1,439,117 83,424 79,829 213,325 12,428 5,000 50,347 1,883,470 235,000 213,407 0 0 0 0 0 0 0 0 0 0 (6,359) (1,488) 171 9,370 69 0 80 1,843 21,593 23,436 TOTAL EXPENDITURE 2,120,313 0 2,120,313 2,096,877 The Ministry of Finance approved the transfer of $54,417 between the SEGs of the Ministry’s appropriation head during the year: 14.5 Statement of Losses The Department of Justice did not provide a Statement of Losses for audit.
AUDIT FINDINGS 14.5 Revolving Fund Account A travelling officer shall recoup the travel advance within seven days of completing travel by submission of an acquittal report with supporting documents.1 If an advance has not been fully expended, the travelling officer must repay the balance within 7 days of completing the travel.2 Upon clearance of the advance, the accounts officer shall update the debtors register, offset the advance account and debit the appropriate expenditure account.3 The Department’s Revolving Fund account has substantial debit balances of $317,494 and some have been carried forward from previous years.
Refer to Table 14.3 for details: Table 14.3: Balances of Revolving Fund Accounts Description Accounts Receivable - Individuals Accounts Payable - Prepaid Expenses Advances Dishonoured Cheques Surcharge TOTAL Amount $ 89,481.34 (1,478.16) 214,607.21 3,550.49 11,333.17 317,494.05 1 Justice Department – Finance Manual section 10.1.11 2 Justice Department – Finance Manual section 10.1.12 3 Justice Department – Finance Manual section 10.1.15 Department of Justice, Prisons and Corrections Section 14: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The large balances in Accounts Receivable Individual resulted from the mapping errors during the implementation of the Financial Management Information System of government.
In 2006 and 2007, double postings were made when the Bank Link program was introduced resulting in variations between the Drawings account and unpresented cheques, consequently funds were transferred to the Revolving Fund account.

Most charges debited to the Advance Account were settled in 2005 and 2006 but were reversed by the Ministry of Finance.

The Department is currently in the process of adjusting the variations and discrepancies.
The delay in passing the necessary adjustment to regularise the variations and discrepancies has resulted in the substantial balance reported in 2007.

Recommendations • The Department should efficiently and effectively carry out the adjustments to correct the RFA account balances with proper co-ordination with the Ministry of Finance.

• The Department should ensure that internal control procedures, specifically supervisory checks, are strengthened to avoid such discrepancies in future.
Management Comments Management comments not yet provided.
14.6 VAT Reconciliation Subject to the provision of the Vat Decree 1991, the tax shall be charged in accordance with the provisions of this Decree at the rate of twelve and a half percent on the supply (but not including an exempt supply) in Fiji of goods and services, by a registered person in the course or furtherance of a taxable activity carried on by that person, by reference to the value of that supply.4 A review of VAT Returns and supporting documents and VAT reconciliation carried out during the audit revealed an un-reconciled balance of $315,974 between the taxable supplies as per VAT Return and the total income/expenditure as per the Statement of Receipts and Expenditure.
Refer Appendix 14.2 for details.

Recommendations • The Department should review explanations for the variance.

its VAT records and reconciliations and provide • Supervisory checks on the preparation of VAT Returns should be improved to ensure that balances reflected in the VAT Returns reconcile with the general ledger.
Management Comments 4 Value Added Tax Decree 1991 4th edition revised to 30/04/04 – section 15 (1) Department of Justice, Prisons and Corrections Section 14: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 14.7 Retaining of Trust Funds – Official Receiver If, where a company is being wound up, it appears, either from any statement delivered to the registrar under Section 33 or otherwise, that a liquidator has in his hands or under his control any money representing unclaimed or undistributed assets of the company which have remained or undistributed for 6 months after the date of their receipt, or any money held by the company in trust in respect of dividends or other sums due to any person as a member of the company, the liquidator shall forthwith pay the said money to the official receiver for the credit of the Companies Liquidation Account, and shall be entitled to a receipt for the money so paid, and that receipt shall be an effectual discharge to him in respect thereof5.
Any person claiming to be entitled to any money paid in pursuance of this section may apply to the official receiver for payment thereof and the official receiver may, on a certificate by the liquidator that the person claiming is entitled, pay to that person the sum due.6 The Office of the Official Receiver is maintaining funds from cases of liquidation of companies that have been fully discarded.
The balances left in favour of judgement debtors are still being retained by the Official Receiver when the funds should be paid out.

Refer to Table 14.4 for examples: Table 14.4: Fully Discarded Companies Winding Up Date File No.
16/09/05 30/05 16/07/05 06/05 08/12/00 23/00 11/12/03 11/03 04/05/01 34/01 22/01/04 30/03 27/09/02 54/01 25/06 10/07/06 100/01 22/02/02 08/07/03 06/00 Company Adz Up Fiji Limited Taiwan Timber Company (Fiji) Limited Ferrier – Watson Enterprises Ltd Fishinvest (Fiji) Limited Radar Pacific Pty Limited Han Bae Enterprises (Fiji) Limited Jafar Construction United Landowning Company Limited Shankar Singh Transport Limited Lok’s Crane Rigging & Pilling Contractors Limited Amount $ 41.44 65.54 616.99 458.75 9,506.17 160.94 49.30 37.33 50.00 112.50 The balance of trust monies from bankruptcy cases have not always been paid out to relevant individuals subsequent to paying off respective creditors and recovering administrative costs for the Office.
Refer to Table 14.5 for examples.
Table 14.5: Trust monies from bankruptcy cases Date Case Discharged Judgment Debtor Outstanding Amount $ 25/06/04 30/06/97 12/08/98 14/11/97 31/10/94 08/02/07 21/12/07 29/08/07 15/02/07 Walusio Buatava Unaisi Raikoso Sovea Tabua Waisake Domu Bal Bahadur Don Bruce Bashir Khan Sanjay Kumar Posiana Nauku 60.00 129.10 64.21 265.75 15.00 504.62 258.25 96.97 39.52 5 Companies Act Cap 247 – Section 335 (1) 6 Companies Act Cap 247 – Section 335 (2) Department of Justice, Prisons and Corrections Section 14: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Date Case Discharged Judgment Debtor 17/10/07 31/10/94 08/08/96 31/10/94 14/08/96 Filimoni Rolagavau Arun Kumar Feroz Khan Gajen Nand Faruk Ahmad Outstanding Amount $ 171.25 170.46 127.50 63.48 7.62 The Office is unnecessarily maintaining funds in its trust fund accounts.
Recommendation The Official Receiver should ensure that funds are paid out to avoid accumulation of funds in the trust accounts.

Management Comments The Official Receiver; newly appointed has taken note of the recommendation and will ensure that outstanding judgment debtors, creditors and administrative costs are paid so that no unnecessary funds are maintained in the both Trust Fund Accounts.

Steps are already undertaken within the Official Receivers Office and the Management to rectify this situation.
14.8 Liquidation Bank Reconciliation - Official Receiver A bank account for public money, other money or trust money must only be established with the approval of the Chief Accountant, who shall inform the bank of the agency officers authorized to operate on it.

All bank accounts shall be reconciled monthly.

The bank reconciliation shall list the outstanding cheques and other reconciling items and be signed and dated by the responsible officer7.
The Accounting Head must make all attempts to issue stop notices for all cheques that have remained unpresented for more than 6 months.

Stale cheques (those which are at least 6 months old) shall be reviewed each month to determine the need for a replacement cheque.

Where a replacement cheque is not required, actions should be taken to clear it.

If for some reason cheques continue to remain unpresented for more than 12 months, stop notice shall be waived and action should be taken to clear them.
The Accounting Head must make all attempts to recover amounts that have been dishonoured by the bank.8 Discrepancies were noted from the review of the bank reconciliations of the Liquidation account maintained by the Official Receiver: • bank credits as shown in the bank statements have not been taken into account in the Cash Book; • Some bank debits shown in the bank statement have not been accounted for in the Cash Book; • Some lodgements were not credited by the bank.
This is detailed in Appendix 14.5, 14.6 and 14.7.

The bank reconciliations prepared by the Office are incorrect.

The risk of fraud and misappropriation of funds increases if bank reconciliations are not carried out correctly.
7 Finance Instructions 2005 - Part 6 – Assets - 39 (1) & (5) 8 Finance Instructions 2005 – Part 6 – Assets – 40 (2), (3), (4) & (5) Department of Justice, Prisons and Corrections Section 14: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • Supervisory checks on cash and cash at bank records and bank reconciliations should be improved.
• Arrangements should be made to clear all unpresented cheques and other balances which have been outstanding for long in the bank reconciliation statements.

Management Comments The Official Receiver has taken note of this to ensure that these two recommendations are facilitated with.
Department of Justice, Prisons and Corrections Section 14: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 14.9 Follow up of Issues Raised in Previous Audits – 2006 Table 14.6: Follow up Issues Issues Recommendation Action Taken Payment of Wages to Suspended Messenger Mr. Imanueli Temo (FNPF – NT256, a Temporary Relieving Messenger at the Office of the Public Trustee was allegedly involved in the misappropriation of fund totalling $29,609.87.
The allegation was lodged with the Serious Fraud Unit of the Fiji Police Force by the Assistant Public Trustee on 25/02/2003.

Considering the seriousness of the allegations, the Permanent Secretary for Justice suspended the officer on full pay with effect from 03/03/2003.

It was of great concern to note that the amendments to the provisions of the JIC Agreement with regards to Section V – Disciplinary as per the PSC Circular 7/2003 of 27/02/2003 was not applied.
As a result, the officer was overpaid a total of $31,056.96 in wages.

Refer to the table below for details: Period 19/02/03 – 31/12/03 01/01/04 – 31/12/04 01/01/05 – 31/12/05 01/01/06 – 31/12/06 01/01/07 – 30/04/07 TOTAL Rate $ 3.12 3.24 3.24 3.34 3.23 No.

of Weeks 46 52 52 52 16 Total $ 6,314.88 7,413.12 7,413.12 7,641.92 2,273.92 31,056.96 Audit also noted that after four years, the case is still pending with the Department of Police.
Though the case was followed up to 14/02/2005 and 06/06/2005, there was no response received from Police.
Unrecovered Public Funds Embezzlement of $1,000 Anare Vakatabuiwaca, EDP 63704, a clerical officer in the Officer Receiver’s No action taken • • • The Ministry must cease the payment of wages to the officer, and responsible officers must be held accountable for the overpayment so that recovery can be effect accordingly; The Ministry must be persistent and aggressive in its follow up approach with the Police Department considering the length of time they had taken to resolve the matter; and Officers of the Ministry must be made aware of the vital need of being updated with the changing rules and regulations issued by the Public Service Commission, together with their application.
• • The Ministry should be more vigilant and take proactive measures in safeguarding public funds; Disciplinary actions should be taken against the relevant to According the Administrative Officer the case is still with Police.

He Department of Justice, Prisons and Corrections Section 14: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation officer’s Supervising Officers.
Action Taken revealed that a follow up with Police was made but police is still investigating the case.

Issues Office was suspended from duties on 03/06/05 without pay, because of his involvement in a disciplinary office in which he fraudulently converted $1,100.74 in cash from the Official Receiver’s Trust Fund for his personal benefit.

On 07/09/05, he was formally charged after clearance from the Solicitor General’s Office.

However, Mr. Vakatabuiwaca failed to respond to the charges laid against him.
As such, his appointment was terminated on 23/08/06, and the amount of $1,100 could not be recovered from the officer.

Unauthorised Absence Through a memo dated 11/04/05, it was established that the officer (Anare Vakatabuiwaca) was absent from work without proper leave approval and non – submission of medicial certificates for a total of 29 days.
Refer to the table below for details: Dates 04/11/04, 05/11/04, 08/11/04, 11/11/04, 15/11/04, 18/11/04, 19/11/04, 22/11/04, 26/11/04, 29/11/04 03/12/04, 08/12/04, 14/12/04 – 17/12/04, 20/12/04, 23/12/04, 24/12/04 04/01/05 – 07/01/05, 10/01/05 – 14/01/05, 17/01/05 TOTAL No of Days 10 w/days Remarks Unauthorized absence Amount to be Recovered $ 189.56 9 w/days Unauthorized absence 10 w/days Unauthorized absence 170.60 189.56 29 549.72 Upon the directive from the CEO, recovery for the above was effected from pay 10/05, however, only $126 was recovered.
The balance of $423.72 remained outstanding.

Department of Justice, Prisons and Corrections Section 14: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Issues The lax attitude of those responsible and their failure to act prudently contributed to the loss of $1,524.46 in public funds.

Recommendation Recommendation Action Taken The Ministry should consider implementing the recommendations highlighted in the 2006 audit report.
Management Comments We had in our reply to the Audit Query for 2006, mentioned that approval for wages payment was given by the Permanent Secretary for Justice, MR Qetaki in his letter dated 28/2/03, to be effective from 03/03/20023.

Temo was suspended in accordance with Clause 54(a) ii& (b) of Section –Discipline of the JIC Agreement.

This was to allow the Police to conduct investigations, without interference.

He was to continue to draw his wages.


The PS Justice did not consider suspending Temos wages since the department had not recommended disciplinary action and had awaited Police to investigate and to lay charges if necessary.

Nothing has been finalized to date.

The recommendation to terminate Temos wages, in 2007, was as a result of non budgetary provisions in Justice Department, since Public Trustee Office had been Corporatised.
Department of Justice, Prisons and Corrections Section 14: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DEPARTMENT OF PRISONS AND CORRECTIONS FINANCIAL STATEMENT 14.10 Audit Opinion The audit of the 2007 accounts of the Department of Prisons and Corrections resulted in the issue of a qualified audit report.
The accounts were qualified as: • The Prisons and Corrections Department has not consolidated its financial statements with the Department of Justice as required.

• The amounts reflected in the Statements of Output Costs have been estimated as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.
It is not possible therefore to determine the accuracy of the expenditures incurred by the Department under the two outputs.

• The Department has not provided for audit a Statement of Losses and a Trust Account Statement of Receipts and Payments, contrary to Finance Instructions 82.

The Financial Management Information System shows that the Department as at 31/12/07 has operating trust funds totalling $418,564.
14.11 Statement of Receipts and Expenditure The Prisons and Corrections Department incurred total expenditures of $13,589,443 in 2007 compared to $14,045,768 in 2006.

Refer to Table 14.7 for details.
Table 14.7: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Cemetery Fees Prison Industries Other State Revenue Total State Revenue 2007 $ 2006 $ 36,836 69,564 11,013 117,413 33,975 64,756 11,608 110,339 Agency Revenue 0 0 TOTAL REVENUE 117,413 110,339 EXPENDITURE Operating Established Staff Unestablished Staff 8,474,623 271,907 8,441,102 358,297 Department of Justice, Prisons and Corrections Section 14: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2007 $ 325,399 620,543 1,465,199 23,921 104,017 11,285,609 2006 $ 311,693 740,376 1,665,696 14,294 129,806 11,661,264 947,016 67,600 - 1,014,616 615,826 37,493 - 653,319 Value Added Tax 1,289,218 1,731,185 TOTAL EXPENDITURE 13,589,443 14,045,768 14.12 Statement of Output Costs The Department of Prison’s Statement of Output Costs consolidates the 4 outputs as prescribed in the Budget Estimates.
These are detailed in Appendix 14.2.

14.13 Appropriation Statement The Department incurred expenditures totalling $13,589,443 in 2007 against the budget of $13,544,143 resulting in an over-expenditure of $45,300.

Details of expenditures against the budget estimates are provided in Table 14.8.
Table 14.8: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 13 Value Added Tax Budget Estimate $ 7,835,446 243,661 251,200 664,100 1,663,380 13,400 120,000 10,791,187 1,182,000 67,556 - 1,249,556 1,503,400 TOTAL EXPENDITURE 13,544,143 Changes $ 0 0 90,000 (35,843) (100,700) 10,700 (35,843) 35,843 0 0 0 Actual Expenditure $ Carry – Over $ Revised Estimate $ 7,835,446 243,661 341,200 628,257 1,562,680 24,100 120,000 10,755,344 8,474,623 271,907 325,399 620,543 1,465,199 23,921 104,017 11,285,609 1,217,843 67,556 - 1,285,399 947,016 67,600 - 1,014,616 1,503,400 1,289,218 13,544,143 13,589,443 Lapsed Appropriation $ (639,177) (28,246) 15,801 7,714 97,481 179 15,983 (530,265) 270,827 (44) - 270,783 214,182 (45,300) 0 0 0 0 0 0 0 0 0 0 0 0 0 Department of Justice, Prisons and Corrections Section 14: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Ministry of Finance approved the transfer of $136,543 between the SEGs within the Department’s appropriation head during the year.
14.14 Statement of Losses The Department did not provide a Statement of Losses for audit as required.
AUDIT FINDINGS 14.15 Financial Statements Commencing 2006 financial year, each annual report must include financial statements which are prepared and signed in accordance with the Finance Instructions, audited by the Auditor General, and accompanied by an audit opinion prepared by the Auditor General.9 The draft financial statements must be submitted to the Auditor General by 31 March in the following year, or within such other time as agreed to with the Auditor General.10 The Prisons and Corrections Department submitted its Financial Statements for audit on 31/03/08 but was not prepared in accordance with the requirements of Section 82 and Schedule 1 of the Finance Instructions 2005.
The following anomalies were noted.

• • • • The Department also failed to provide a Statement of Losses for audit.

In addition, the Department failed to carry out its annual stock-take of fixed assets in 2007.

The 2007 Budget prescribed four outputs; however, the Department only submitted two Statements of Output Costs which were prepared according to the budget activities.
Audit could not substantiate the balances reflected in the Statements of Output Costs as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.
The Department did not consolidate its financial statements with the Department of Justice as both Departments comprise a Budget Sector Agency under the Appropriation Promulgation 2007 The 2006 balances in the financial statements submitted for audit did not reconcile with the Appendix 8 of the 2006 Accounts and Finance and the general ledger (FMIS).

However, the balances have been amended according to the FMIS.

Refer to Appendix 14.3 for details.


Non-compliance with Finance Instructions in the preparation of financial statements has restricted the scope of the audit and will be included as qualifications in the audit report.
9 Finance Instructions 2005 – 81 (2) 10 Finance Instructions 2005 – 81 (3) Department of Justice, Prisons and Corrections Section 14: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation The Department should ensure that the requirements of the Finance Instructions 82 are strictly followed in the preparation of the Agency Financial Statements.

Management Comment Management comments not yet provided.
14.16 Over-Expenditure Each year the Appropriation Act and the Budget Estimates set out details of the appropriations that Parliament approves for spending by each agency.

No Officer may incur expenditure which results in the agency’s appropriation being exceeded without the proper authorisation of the Ministry of Finance, pending approval by Parliament.11 Analysis of the expenditures for 2007 indicated that the Department had incurred over-expenditures under SEG1 and SEG 2.
Refer to Table 14.9 for details.

Table 14.9: SEG 1 and SEG 2 Over-expenditure Details SEG Description 1 2 Established Staff Unestablished Staff Revised Provision ($) 7,835,446 243,661 Actual Expenditure ($) 8,474,623 271,907 Over- expenditure ($) (639,177) (28,246) Over-expenditure (%) (8.2) (11.6) The over-expenditures in the 2 SEGs resulted in the overall over-expenditures in the Department’s budget by $45,300.
Excessive expenditures of funds indicate inadequate supervisory checks and ignorance of standing financial instructions.

Recommendations • Management of the Prisons and Corrections Department should take active roles in ensuring that the Department operate within its approved budget.

• Expenditures should be reviewed against the budget allocation on a monthly basis and reported to management for effective and efficient decision-making.

• Supervisory checks should be improved.
Management Comments 14.17 Revolving Fund Account - Suspense The Ministries/Departments should provide funds to write-off Manufacturing Accounts already recommended for suspension.12 losses all the Trading and 11 Finance Instructions 2005 Section 8 12 Finance Circular dated 15/02/00 Department of Justice, Prisons and Corrections Section 14: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The closing balance of the RFA – Suspense Account as at 31/12/07 totalled $582,858 which represents accumulated losses made by the Department’s Trading and Manufacturing Account (TMA) through its prior years’ operations.
The Department has ceased to operate this Revolving Fund account.

The balance did not reconcile with Appendix 19 of the Accounts and Finance, which reflected a closing balance of $37,578.

The Department could not provide any reason for the variations although the account was not in operation in 2007.

In absence of the proper records, audit could substantiate the accuracy of the balances of the RFA – Suspense.
Recommendation The Department should liaise with the Ministry of Finance to identify and make necessary adjustments of any mispostings to the RFA - Suspense.

Management Comments Management comments not yet provided.
14.18 Drawings Account The “Drawings Account” will be operated for all payments except for those payable from petty cash bank accounts, TMA bank account and Trust Bank account.13 The closing balance of the Drawings account for 2007 as per the Department’s record did not reconcile with the general ledger (FMIS).
Refer to Table 14.10 for details: Table 14.10: Details of Variances Details General Ledger (FMIS) Departments Record Variance Balances ($) 1,104,558.60 372,800.80 731,757.80 In absence of proper reconciliations, the balance reported on Appendix 3 of the Accounts and Finance could not be substantiated.

Recommendations • The Department should review its monthly Drawings Account reconciliations for 2007 and take into account the issues raised above.
• Supervisory checks on the monthly reconciliations should be improved.

Management Comments Management comments not yet provided.
13 Finance Manual 2005 Section 7.4.3 Department of Justice, Prisons and Corrections Section 14: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 14.19 VAT Reconciliation Subject to the provision of the Vat Decree 1991, the tax shall be charged in accordance with the provisions of this Decree at the rate of twelve and a half percent on the supply (but not including an exempt supply) in Fiji of goods and services, by a registered person in the course or furtherance of a taxable activity carried on by that person, by reference to the value of that supply.14 Output VAT is payable to the Commissioner of Inland Revenue for the supply of all goods and services with the exception of zero rated and exempted supplies.
Payments effected by government departments for goods and services are thus subjected to VAT.15 The scope of audit of VAT records was limited as the Department did not maintain records of monthly VAT Returns and the accuracy of VAT payments during the year could not be substantiated.

Recommendations • The Department should ensure that records pertaining to VAT are properly maintained for reconciliation and audit purposes.
• Supervisory checks on the preparation of VAT Returns should be improved to ensure that balances reflected in the VAT Returns reconcile with the General Ledger.
Management Comments 14.20 FNPF Reconciliation Every employer shall pay to the Fund in respect of each of his/her employees, in every month during which such employee by him/her and in the month following the termination of such employment, a contribution calculated upon the amount of wages payable to such employee by such employer for the preceding month at the appropriate rates.16 The current rate of contribution (effective 1st July, 1999) is 16cents on each dollar earned, with the employer and employee each contributing 8cents each.
Contributions that are paid after the due date carry a surcharge at a rate of 2%.

Failure to pay contributions on the due date is a serious and is a punishable offence.

17 A reconciliation of FNPF contributions against salaries and wages reported in the Financial Statements revealed variances as detailed in Appendix 14.8.

The Department did not provide any explanations for the variance.
Recommendation The Department should review its FNPF records and reconciliations and provide explanations for the variances.
14 Value Added Tax Decree 1991 4th edition revised to 30/04/04 – section 15 (1) 15 Finance Circular No 9/95 16 Chapter 219 – Fiji National Provident Fund – Section 13 (1) 17 www.fnpf.com.fj –official web site address Fiji National Provident Fund Department of Justice, Prisons and Corrections Section 14: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments 14.21 Unsafe work environment - Suva Prison Administration Block Every employer shall ensure the health and safety at work of all his or her workers.
An employer shall provide and maintain plant and systems of work that are safe and without risks to health.18 Physical inspection of the Administration Block of the Suva Prison revealed the poor and dilapidated working environment of the Prison Officers.

The Officers are exposed to unsafe, risky and substandard environment.

Refer below for illustrations: The current working environment indicated above does not comply with requirements of the Health and Safety at Work Act.
Recommendation The Department should actively pursue the improvements and repairs of prison facilities with the Government.

Management Comments This is not new.

In fact it has been an on-going issue highlighted year in and year out in the Prison Service audit query.

Our renovation is contingent on the budgetary provisions dispensed to us by government on a yearly basis.

We therefore cannot fix everything at once given the meagre resources allocated by government.
However, we have started our renovations since 2003.

Thereafter, every year a prison institution is identified and fixed in compliance with international standards, OHS and Human Rights Commission dictates.

This year Ba prison will be renovated.

We fully agree with the observations.

In the absence of funds no improvements can be done this year even though our records show the consistent submission of requests to the Ministry of Finance for renovations of buildings.
In the meantime the Department in partnership with the Ministry of Labour jointly produced and launched an OHS manual and will be incrementally implemented, again depending on government allocations.

Furthermore, the Department has completed a full scale OHS audit of the buildings in Suva in partnership with the Ministry of Labour.

14.22 CCTV Equipment Physical assets provide a vital resource base that supports the delivery of outputs by the agency.
Therefore it is important to ensure that assets are safe guarded and properly maintained and all assets held by the agency are used efficiently.19 18 Health and Safety at Work Act 1996 (9) (1) & (2) 19 Departments Finance Manual Part 11 Property Plants and Equipment Department of Justice, Prisons and Corrections Section 14: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Elcom Services Ltd was contracted to install CCTV Cameras at the Naboro Maximum and Medium Security Prisons.
As of December 2007, the Department has incurred a total of $196,349 for the purchases and installations of the CCTV.

Refer to Table 14.11 for details: Table 14.11: Details of Purchases Station Naboro Central Monitoring Medium Security Prison Maximum Security Prison Total Cost Incurred ($) 42,215 90,649 63,485 196,349 The project has yet to be completed and the Central Monitoring Station at Naboro in which all the monitoring system from Prison Institutions would be controlled is not fully functional.
During the inspection,20 audit noted that technical equipments purchased for the CCTV remained idle at the Central Monitoring Station at Naboro.
Refer to Table 14.12 for details: Table 14.12: Details of Equipment not yet installed 320GB S-ATA HDD(with Description Samsung 32” Wall Mountable TFT Screen Dual Redudant Power Supply Inter Core 2 Duo E6700 3GB DDR2 RAM Removable spare) Windows XP Pro Cordless Keyboard with mouse Switch KVM Extender over CAT 5 Door Access Control System with 30 cards Total Qty 3 3 3 3 3 3 3 1 3 2 Cost ($) 29,172 662 3,981 3,500 37,315 The electrical equipments are not safely stored to ensure that their condition do not deteriorate before the CCTV is fully functional.
The project would only be completed when funds are allocated to the Department for the purchase of remaining equipment to complete the project.

The high cost that has already been incurred warrants the Department’s attention in ensuring that the project is fully functional as early as possible.

Recommendations • The Department should ensure the safe custody and storage of the items already procured.

• All equipments must be fully accounted for and taken on charge in the Fixed Assets Register.
Management Comments The CCTV project is a long initiative.

It started in 1996.

Government approved a policy for all prisons to be installed with CCTV equipments.

So far Maximum prison has been completed.

The equipments seen by the Auditor were purchased from the 2007 Budget provisions.

The remaining equipments to be purchased from 2008 allocations are still with the Ministry of Finance awaiting release of funds.
The purchasing of the remaining 20 Audit inspection on 04/03/08 Department of Justice, Prisons and Corrections Section 14: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 equipments will complete the required parts for the setting up of a central monitoring station at Naboro and connection of Medium and Minimum Prisons.
We fully agree that the parts should be stored in a conducive environment but in the absence of funds the Department cannot purchase air conditioners.

The dispensing of funds on piece meal basis is not appropriate in this type of project.

Funding should be approved instantly instead of having to go through the normal tender and RIE process because this particular project is an ongoing one.

The delays resulting from the lengthy process can cause damage or loss to government.
It is now July and still a tender is being processed.

Meanwhile all the equipments have been stored in a safer place.
Department of Justice, Prisons and Corrections Section 14: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 14.1: Statement of Output Costs for 2007 – Department of Justice Portfolio Leadership, Policy Advice and Secretariat Support Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Costs 2007 $ 2006 $ 1,439,117 83,424 79,829 213,325 12,428 5,000 50,347 1,883,470 1,736,161 72,741 94,595 167,895 11,344 5,000 11,914 2,099,650 - - - - - - - - Value Added Tax 213,407 259,577 TOTAL EXPENDITURE 2,096,877 2,359,227 Appendix 14.2: Unreconciled VAT Variances Details Total expenditure as per Statement of Receipts and Expenditure Less: Expenditure not subject to VAT – SEG 6 Less: Total taxable supplies as per Vat returns Un–reconciled variance $ 2,096,877 5,000 2,091,877 1,775,903 315,974 Department of Justice, Prisons and Corrections Section 14: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 14.3: Statement of Output Costs for 2007- Prisons Department General Administration Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 1,577,206 - 33,863 465,135 22,461 - - 2,098,665 2,244,993 114 46,337 507,741 36,883 894 - 2,836,962 947,016 - - 947,016 615,826 37,493 - 653,319 Value Added Tax 372,792 459,039 TOTAL EXPENDITURE 3,418,473 3,949,320 Penal Institutions Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication
 Maintenance & Operations Purchase of Goods & Services Operating Grants and Transfer Special Expenditure Total Operating Costs Capital Expenditures Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 6,897,417 271,907 291,536 155,408 1,442,738 23,921 104,017 9,186,944 6,196,109 358,183 265,356 232,635 1,628,813 13,400 129,806 8,824,302 - 67,600 - 67,600 - 0 - 0 Value Added Tax 916,426 1,272,146 TOTAL EXPENDITURE 10,170,970 10,096,448 Department of Justice, Prisons and Corrections Section 14: Page 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 14.4: Output Costs Variances for 2006 General Administration SEG Description Established Staff Unestablished Staff Travel and Communication Maintenance & Operation Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Capital Construction Capital Purchase Value Added Tax Total Expenditure Penal Institutions SEG Description Established Staff Unestablished Staff Travel and Communication Maintenance & Operation Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Capital Construction Capital Purchase Value Added Tax Total Expenditure AFS 2006 ($) 1,852,250 114 45,205 494,552 35,137 894 - 361,780 - 396,869 3,186,801 AFS 2006 ($) 6,461,315 340,358 257,328 214,245 1,392,822 12,149 54,560 - - 815,945 9,548,722 FMIS ($) Variance 2,244,993 114 46,337 507,741 36,883 894 - 615,826 37,493 459,039 3,949,320 FMIS 2006 ($) 6,196,109 358,183 265,356 232,635 1,628,813 13,400 129,806 - - 1,272,146 10,096,448 (392,743) - (1,132) (13,189) (1,746) - - (254,046) (37,493) (62,170) (762,519) Variance 265,206 (17,825) (8,028) (18,390) (235,991) (1,251) (75,246) - - (456,201) (547,726) Department of Justice, Prisons and Corrections Section 14: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 14.5: Bank Credits not
 taken into account in the Cash Book Date Particulars Increase in Opening Bank Balance as at 01/04/89 - - - - - 01/04/89 30/06/92 30/07/92 28/01/93 29/01/93 29/01/93 02/10/95 Miscellaneous Credit 01/08/96 Miscellaneous Credit 06/09/04 Bankruptcy proceeds erroneously credited to Liquidation Account by bankers 07/09/04 Bankruptcy proceeds erroneously credited to Liquidation Account by bankers 20/09/04 Surplus Credit 20/09/04 Bankruptcy proceeds erroneously credited to Liquidation Account by bankers 22/10/04 Bankruptcy proceeds erroneously credited to Liquidation Account by bankers 20/12/05 Miscellaneous Credit TOTAL Appendix 14.6: Bank debits not accounted in the Cash Book Date 18/02/87 10/10/90 - 24/10/90 16/09/93 18/04/94 06/07/94 02/10/95 31/12/96 31/12/96 31/12/96 31/12/96 31/07/01 01/10/06 01/10/06 04/04/06 TOTAL Particulars Miscellaneous Debit Miscellaneous Debit Miscellaneous Debit Miscellaneous Debit Miscellaneous Debit Miscellaneous Debit Miscellaneous Debit Miscellaneous Debit Dishonoured Cheque Fee Dishonoured Cheque Dishonoured Cheque Fee Dishonoured Cheque Differential in Cheque No.
39055 ^ P/V amount Cheque Amount in Excess by 0.01 Dishonoured cheque iro Kumar Textiles Dishonoured cheque iro Kumar Textiles fee Dishonoured cheque by Fa & Co iro Fiji Hardwood Corporation petition fees Appendix 14.7: Lodgements not credited by the bank Date 03/02/89 03/02/89 07/02/89 20/11/93 29/04/89 26/02/89 Particulars - - - - - Lautoka RR 0779 not credited Suva RR 1962 Suva RR 1969 Amount $ 1,242.15 65.00 20.00 220.00 2,410.00 110.00 100.00 110.00 10.00 120.00 0.30 100.00 120.00 112.50 4,739.95 Amount $ 679.49 4.89 10.00 50.00 50.00 110.00 8.00 100.00 15.00 50.00 15.00 50.00 0.01 400.00 10.00 10.00 1,562.39 Amount $ 100.00 1,700.00 100.00 100.00 200.00 100.00 110.00 2,300.00 Department of Justice, Prisons and Corrections Section 14: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Date 06/03/96 26/07/96 30/09/96 01/12/97 14/12/98 TOTAL Particulars Suva RR 2092 Suva RR 2197 not Credited Suva RR No.
2476 not credited Suva RR No.

9033 & 9034 not credited Suva RR # 10175 of 01/12/97 not banked as at 31/12/05 due to theft of funds Lautoka RR No.
2351 of 14/12/98 erroneously deposited to Bankruptcy current account Amount $ 50.00 110.00 110.00 220.00 200.00 110.00 5,510.00 Appendix 14.8: Details of FNPF Reconciliations Details (a) Total FNPF against salaries and wages for 2007 FNPF as per financial statements Add: FNPF for December 2007 Less: FNPF for December 2006 FNPF for 2007 Gross pay subject to FNPF (604,681 divided by 0.08) (b) Salaries and wages for 2007 subject to FNPF: Salaries, Wages and Allowances as per financial Statement Less: Salaries and wages not subject to FNPF Salaries, wages and allowance for 2007 subject to FNPF Variance $ 628.836 45,006 673,842 69,161 604,681 7,558,513 8,117,696 - 8,117,696 559,183 Department of Justice, Prisons and Corrections Section 14: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 15 Department of Archives Programme Statement Information and National Information and Media Relations The Department is responsible for disseminating information in Fiji and the government’s plans, policies and progress to promote development through a well informed and enlightened society.
Through its programme, it aims to create positive attitudes to community and national development, stimulate and mobilize support for government policies and programmes.

It aims to increase public awareness of their social, economic and political environment and to better inform them about major national development issues.

As government’s information agency, the Department also provides the link between Government and media and through the latter with people.
The Department will be responsible for developing and introducing new media legislation to develop a more vibrant media industry.

It will seek to promote and encourage industry initiatives in areas such as human resource development and training, professional development and networking in the media.

Its development policies on the mass media signify the critical role of this sector in the national development by placing special considerations on the people’s needs and aspirations.
National Archives The National Archives of Fiji is responsible for the appraisal, acquisition, safe custody, and the proper conservation and maintenance of the permanent records of the government.

This includes control of access of these records, the provisions of reference and information service to Ministries and Departments, students and members of the public, as well as the promotion of the scholarly research among the records held by it.
The Ministry also advises and assists Government Offices in their record management.

Further improvements are essential for the existing facilities to ensure the safety and proper preservation of public records.

Emphasis will be given to repairing damaged records and the restoration of micro filming of old and fragile documents.

The Reference Library and Research Section will continue to encourage compliance on the Fiji “legal deposit” requirements.
Table of Contents 15.1 15.2 15.3 15.4 15.5 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditures ..................................................................... 2 Statement of Output Costs........................................................................................... 3 Appropriation Statement .............................................................................................. 3 Statement of Losses .................................................................................................... 4 AUDIT FINDINGS ................................................................................................................................. 4 Agency Financial Statements....................................................................................... 4 15.6 15.7 Operating Trust Fund Account ..................................................................................... 5 15.8 Drawings Account ........................................................................................................ 5 VAT Reconciliation ...................................................................................................... 6 15.9 FNPF Reconciliation................................................................................................ 7 15.10 Overpayment of Salaries ......................................................................................... 7 15.11 Unwarranted Expenditures ...................................................................................... 8 15.12 Section 15: Page 1 Department of Information REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Provision of Acquittal for Capital Construction - National Archives .......................... 9 15.13 Appendix 15.1 – Statement of Output Costs........................................................................... 11 Appendix 15.2 : FNPF Reconciliation .................................................................................... 13 FINANCIAL STATEMENT 15.1 Audit Opinion The audit of the 2007 accounts of the Department of Information and resulted in the issue of a qualified audit report.
The qualifications are as follows.

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

It is not possible therefore to determine the accuracy of the expenditures incurred by the Department under each output.
b) The Department has not provided for audit a Trust Account Statement of Receipts and Payments, contrary to Finance Instructions 82.

The Financial Management Information System shows that the Department as at 31/12/07 has overdrawn operating trust funds totalling $5,752.

15.2 Statement of Receipts and Expenditures The Ministry incurred a total expenditure of $5,526,127 in 2007 compared to $4,975,232 in 2006.
Table 15.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue License Fees - Telecom & TV Other State Revenue Total State Revenue Agency Revenue Revenue from Sale of Production Film Miscellaneous Sale of Photographs Other Agency Revenue Total Agency Revenue TOTAL REVENUE EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Department of Information 2007 $ 2006 $ 1,114,000 141,020 1,255,020 3,667,277 464,629 4,131,906 18,143 12,458 - - 30,601 1,285,621 28,140 18,169 211 12,347 58,867 4,190,773 1,290,089 144,533 128,872 211,517 1,510,690 113,512 172,753 187,155 Section 15: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Expenditure Capital Construction Total Capital Expenditure 2007 $ 225,257 1,018,558 407,311 3,426,137 2006 $ 417,601 1,164,090 238,907 3,804,708 1,688,406 1,688,406 781,211 781,211 Value Added Tax 411,584 389,313 TOTAL EXPENDITURE 5,526,127 4,975,232 15.3 Statement of Output Costs The Statements of Output Costs are detailed in Appendix 15.1.
15.4 Appropriation Statement The Department incurred expenditures totalling $5,526,127 in 2007 against the budget of $6,464,876 resulting in a savings of $938,749 or 14.5%.

Details of expenditures against the budget estimates are provided in Table 15.2.
Table 15.2: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Construction Total Capital Expenditure 13 Value Added Tax Budget Estimate $ 1,448,678 158,812 193,632 351,709 363,640 1,112,705 573,000 4,202,176 1,700,000 1,700,000 562,700 TOTAL EXPENDITURE 6,464,876 Changes $ 0 0 0 (41,000) 41,000 0 0 0 Revised Estimate $ Actual Expenditure $ Carry – Over $ 1,448,678 158,812 193,632 310,709 404,640 1,112,705 573,000 4,202,176 1,290,089 144,533 128,872 211,517 225,257 1,018,558 407,311 3,426,137 0 0 0 0 1,700,000 1,700,000 1,688,406 1,688,406 562,700 411,584 6,464,876 5,526,127 Lapsed Appropriation $ 158,589 14,279 64,760 99,192 179,383 94,147 165,689 776,039 11,594 11,594 151,116 938,749 0 0 0 0 0 0 0 0 0 0 0 0 The Ministry of Finance approved the transfer of $41,000 from SEG 4 Maintenance and Operations to SEG Purchase of Goods and Services during the year.
Department of Information Section 15: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 15.5 Statement of Losses Revenue receipts amounting to $207 were not lodged to the bank.

Refer to the Table below for details: Table 15.3: Losses of Revenue 2007 Receipts Date Receipt No.
N/A 19/10/07 02/11/07 06/11/07 13/12/07 Total 89297 89298 559555 559556 559557 Amount ($) 49.00 50.00 45.00 48.00 15.00 207.00 AUDIT FINDINGS 15.6 Agency Financial Statements Commencing 2006 financial year, each annual report must include financial statements which are prepared and signed in accordance with the Finance Instructions, audited by the Auditor General, and accompanied by an audit opinion prepared by the Auditor General.1 The draft financial statements must be submitted to the Auditor General by 31 March in the following year, or within such other time as agreed to with the Auditor General.2 The Department of Information submitted its draft financial statements for audit on 31/03/08 but they were not prepared in accordance with the requirements of Section 82 and Schedule 1 of the Finance Instructions 2005.
The 2007 Budget prescribed eight outputs; however, the Department only submitted for audit six Statements which were prepared according to the budget activities.

Audit could not substantiate the balances reflected in the Statements of Output Costs as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.
The Department also failed to provide for audit a Statement of Losses and the Trust Fund Statement of Receipts and Payments.

Recommendation The Department should ensure that the requirements of the Finance Instructions 82 are strictly followed in the preparation of the Department’s financial statements.

Management Comment The Department did not provide any comments.
1 Finance Instructions 2005 – 81 (2) 2 Finance Instructions 2005 – 81 (3) Department of Information Section 15: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 15.7 Operating Trust Fund Account The Ministry maintains a number of Operating Trust Fund accounts and the balances as at 31/12/07 are as follows: Table 15.4: Details of the Operating Trust Fund Account Details Account No and PD Revenue Account PD Insurance PD Loans Advances PD Union PD Maintenance PD Others Miscellaneous Fund Total 1160000000861100 1160000000861200 1160000000861300 1160000000861500 1160000000861600 1160000000861900 1160000000899900 Balances $ (48.90) (549.93) (1,517.58) (135.50) (99.00) 12,828.44 (4,725.13) 5,752.40 The correctness of the balance provided in the Financial Management Information System could not be ascertained as the Department failed to prepare monthly reconciliations.
The general ledger (FMIS) also has an overdrawn account of $12,828 under the PD Others.

In absence of the proper reconciliations, audit could substantiate the correctness of the balances reflected in the FMIS and Appendix 23B of the Accounts and Finances.

Recommendations The Department should ensure that the Trust Fund Account reconciliations are prepared on a monthly basis and verified with the Financial Management Information System.

Management Comment The Department did not provide any comments.
15.8 Drawings Account The “Drawings Account” will be operated for all payments except for those payable from petty cash bank accounts, TMA bank account and Trust Bank account.3 Chief Executive Officers and Accounting Heads must follow up closely with their various clients and suppliers to present their cheques with in reasonable period of time.
Write off action should be taken once they become stale whereby those relating to the current year is charged against the appropriate expenditure allocation and those of previous years against the general revenue account.4 The balance of the un-presented cheques for 2007 as per the Department’s reconciliation did not agree with to the balance in the general ledger (FMIS).
Refer to the Table below for details: 3 Finance Manual 2005 Section 7.4.3 4 Finance Circular 21/2007 dated 12/11/07 section 7.4.2 Department of Information Section 15: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 15.5: Details of variance as per FMIS and Department’s Record Details FMIS Departments Record Variance Balances ($) 179,519 202,894 23,375 The balance also include stale cheques amounting to $1,537 that have not been regularised.
The anomalies imply that the monthly Drawing Account reconciliations may not have been thoroughly checked by the Senior Accounts Officer.

Recommendations • The Department should immediately reconcile and adjust the variances noted between the FMIS and the Department’s records.

• The Department should clear stale cheques in accordance with Section 7.5 of the Finance Manual.

Management Comments The Department did not provide any comments.
15.9 VAT Reconciliation Subject to the provision of the Vat Decree 1991, the tax shall be charged in accordance with the provisions of the Decree at the rate of twelve and a half percent on the supply (but not including an exempt supply) in Fiji of goods and services, by a registered person in the course or furtherance of a taxable activity carried on by that person, by reference to the value of that supply.5 Output VAT is payable to the Commissioner of Inland Revenue for the supply of all goods and services with the exception of zero rated and exempted supplies.
Payments effected by government departments for goods and services are thus subjected to VAT.6 The scope of audit on the VAT records was limited as the Department did not maintain all records of monthly VAT Returns.

As a result, the accuracy of VAT payments during the year could not be substantiated.

Recommendations • The Department should ensure that records pertaining to VAT are properly maintained for reconciliation and audit purposes.
• Supervisory checks on the preparation of VAT Returns should be improved to ensure that balances reflected in the VAT Returns reconcile with the general ledger.

Management Comments The Department did not provide any comments.
5 Value Added Tax Decree 1991 4th edition revised to 30/04/04 – section 15 (1) 6 Finance Circular No 9/95 Department of Information Section 15: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 15.10 FNPF Reconciliation The current rate of contribution (effective 1st July, 1999) is 16 cents on each dollar earned, with the employer and employee each contributing 8cents each.

Contributions that are paid after the due date carry a surcharge at a rate of 2%.
Failure to pay contributions on the due date is a serious and is a punishable offence.

7 A reconciliation of FNPF contributions against salaries and wages reported in the Financial Statements revealed variances $291,077.

The details are shown in Appendix 15.2 Recommendation The Department should review its FNPF records and reconciliations and provide explanations for the variances.

Management Comments The Department did not provide any comments.
15.11 Overpayment of Salaries Salary Change Advice shall be prepared by Departments where they affect personal emoluments and deductions such as resignation and retirement.8 Salary advices must be submitted promptly to the Ministry of Finance where there is any change to personal emoluments or deductions dismissal, resignations and retirement.9 The former Director Information, Mrs. Susan Grey10, resigned from the Public Service with effect from 15/10/07.
The officer continued to be paid her salary until 18/11/07 resulting in the overpayment of salary amounting to $4,129.

In 2006, the Officer was awarded a government scholarship to undertake postgraduate studies for one year with the University of the South Pacific.

She failed to fully serve her bond obligation on her return from study leave before resigning from the service.
According to a letter from the Public Service Commission dated 20/12/07, the officer owes the government $14,276 for the remaining 4 months of her bond that she failed to serve.

Audit questioned the Department’s decision in accepting Mrs. Susan Grey’s resignation prior to her serving the full term of her bond obligation.

The overpayments of salaries imply the absence of adequate supervisory checks on payroll.

Recommendation Salary overpayments should be recovered from the officer.
If recovery is not possible, the Department should investigate the cause of the overpayment and surcharge responsible officers.

7 www.fnpf.com.fj –official web site address Fiji National Provident Fund 8 Finance Instruction 59(4) 9 2005 Finance Instructions 26(1) 10 EDP No.
- 49979 Department of Information Section 15: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments With the overpayment of salaries, effort is now underway to recover the overpaid amount from the officer.

A letter has been delivered to the officer requesting for the reimbursement of the overpaid salary.

Failing this, the department will take the next step which is to go through legal avenues available.
Please note that as of today, the Public Service Commission still has to issue a formal letter of approval for the officer’s resignation, with the official date of resignation.

This stems from the fact that the officer is contending that she has fully worked the period of her bond.
The department has had a meeting with the Public Service Commission on this issue and the Commission has agreed to pursue the repayment process with the officer, as the signed bond document was made between the officer and the Public Service Commission.

The Commission has also undertaken to write immediately to the officer for the recovery.

The recovery contingencies outlined in your recommendation are noted and will be pursued depending on the nature of response from the officer concerned.
15.12 Unwarranted Expenditures The proper management of expenditure is fundamental to ensuring value for money in delivering services to the community.

As well, having cost effective internal controls within the purchasing and payments system plays an important part in ensuring that waste of funds, over expenditures and corruption do not occur.11 In December 2006, the Department was relocated to the Fiji Bank Employees Union (FBEU) Building on the directive of the Public Service Commission.
To facilitate the relocation, the Department engaged various companies and individuals at a cost of $24,509.

The costs were incurred on carting of furniture, dismantling and setting up work stations and registry cabinets, and setting up and wiring for internet, telephone etc.

Six months into relocating to the FBEU Building, the Department was again directed to move back to its old office at Government Buildings.

The Department incurred another $16,762 to facilitate the relocation.
Refer to the Table below for details: Table 15.6: Details of Relocation Company Name Description of Services Eagle Cleaning William & Goslings Nakura Youth Ahmed Ali & Co. Transcomm General Total Clean carpet & shampoo office Cartons for packing and cartage Youth group engaged as labours Hired to dismantle all workstations and registry cabinets and set up in new premises Connect FMIS Link Overhead cost Amount paid ($) 545.00 1,475.33 2,350.00 6,939.01 5,393.06 59.21 $16,761.61 The expenditures totalling $41,270 could have been avoided had proper planning and consultation were made prior to the relocation of the Department.
11 Department’s Finance Manual 2005 Part 2 Department of Information Section 15: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation The Department together with the Public Service Commission should ensure that proper economy is exercised always to avoid wastage of public funds.

Management Comments the deregulation of the Telecommunication The recommendation of the Audit team is noted.
The Department had requested Public Service Commission for a bigger office space in early 2006.

This was in anticipation of having the World Bank set up a Project Unit to this process, a new facilitate Telecommunication Regulatory Authority would also be established and would have separate functions from the Department of Communication.

All these units were proposed to be housed in the same building.
In addition, the department’s Public Relations unit was also housed in a different building and it was also anticipated that the unit would be housed in the same office building as the rest of the ministry.

PSC therefore located and organised the move to the Fiji Bankers Association building in December 2006.

The department was instructed to move back to government buildings by PSC in September 2007, as FICAC had identified the Fiji Bankers Association building as ideal for their purposes.
Further queries on this issue should be directed to Public Service Commission who was the decision maker on this issue.

Industry.
Apart from 15.13 Provision of Acquittal for Capital Construction - National Archives Where it is necessary to request another agency to perform works or services on the agencies behalf, the Accounts Officer may authorize the issue of a departmental warrant to the performing agency to carry out the works or services.12 On receipt of an advice form from the performing agency, the clerical officer shall verify the warrant authority and check supporting documentation before accepting the charges.13 In 2007, a sum of $1,702,467 was allocated through SEG 8 of the National Archives budgetary allocation for the continuation of the construction of the new National Archive building.
The budgetary allocation was disbursed to Ministry of Works through the following Departmental Warrants: • DW MOI 01/07 of 11/04/07 - $702,467 • DW MOI 02/07 of 16/07/07 - $1,000,000 Acquittals and supporting documents have yet to be provided by the Ministry of Works.

The Department of Information has been following up with the Ministry of Works for the provision of acquittals but to no avail.
In addition, the Form S14 received and the charges posted to the Department’s Inter-Department Clearance (IDC) account by the Ministry of Works exceeded the allocated appropriation by $185,497.
Refer to Table below for details: Table 15.7: Details of Excess Charges Date DW No DW Amount Charges As Per IDC Account And Form S Excess 11/04/07 MOI 1/07 16/07/07 MOI 2/07 $702,467 $1,000,000 $1,887,964.94 $185,497.94 12 Departments Finance Manual 2005 – Section 2.5.20 13 Department Finance Manual 2005 Section 2.5.23 14 Form S refers to a document that advises a charge that has been made to the Department’s IDC account.
Department of Information Section 15: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Instances where charges were posted to the IDC account but without any Form S provided to the Department were also noted and on other occasions Form S were received but the charges were not posted to the IDC allocation.
Refer to Table 15.8 below for details: Table 15.8: Details of Charges Date 26/10/07 Ref No - 29/10/07 411621 31/12/07 1411865 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 31/12/07 TOTAL 411757 411758 411855 411909 416310 416328 416330 416343 416344 411979 411980 411983 Particulars Contract payment for roofing materials Materials, Plant Hire , wages etc Works carried out at National Archives.
No Form S No Form S No Form S No Form S No Form S No Form S No Form S No Form S No Form S No Form S No Form S No Form S Remarks No charges posted Account No charges posted Account No charges posted Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Posted to IDC Account Amount ($) to IDC 32,680.00 to IDC 214.09 to IDC 7,973.96 154,821.46 44,957.20 21,897.67 4,409.00 16,296.00 8,100.00 197,121.04 20,296.00 224,553.14 1,940.00 8,136.14 3,768.58 747,164 The provisions of acquittals and supporting documents are important to substantiate that funds have been utilised for their intended purposes.
Recommendation The Department should regularly reconcile its records with Ministry of Works to ensure that expenditures incurred are related to the project and charged to the relevant allocation.

Management Comments The Department agrees with the recommendation of the Audit team.

As noted, the Department had made repeated efforts to obtain acquittals from PWD.

It is also noted that the majority of the charges were passed to the Department dated 31/12/2007.
The Department was not given sufficient time to verify the charges passed to it through the IDC account, as in normal inter-departmental transactions.

In fact for the last three years of this project, it has been the same story with PWD and the Department is in fact frustrated with their tactics as well.

It is recommended that a thorough audit of their books be conducted to verify the charges.

PWD needs to more transparent and forthcoming with the provision of information for the purpose of acquittals .
With reference to the over-expenditure of the DW issued, again, as mentioned charges were passed to the department at the 11th hour when the pressure was on from Ministry of Finance to bring the IDC accounts to zero balance.

The department had accepted the charges only because there were sufficient funds available in the project vote to absorb the charges.
Department of Information Section 15: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 15.1 – Statement of Output Costs Policy and Administration 2007 Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs 2007 $ 2006 $ 252,049 67,201 67,543 123,044 46,400 1,017,858 121,710 1,695,805 471,266 58,643 70,426 65,927 212,118 1,007,161 236,497 2,122,038 Value Added Tax 82,923 127,850 TOTAL EXPENDITURE 1,778,728 2,249,888 Film and Television Unit 2007 Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Total Operating Costs 2007 $ 2006 $ 235,937 36,206 17,072 16,553 40,387 346,155 227,950 30,926 24,834 34,579 85,258 403,547 Value Added Tax 24,277 47,519 TOTAL EXPENDITURE 370,432 451,066 News and Publications 2007 Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Special Expenditure Total Operating Costs 2007 $ 2006 $ 370,414 - 25,033 5,092 72,873 587 473,999 336,672 - 49,902 11,996 100,472 2,410 501,452 Value Added Tax 27,362 72,039 Department of Information Section 15: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description TOTAL EXPENDITURE National Archives 2007 Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Total Operating Costs Capital Expenditure Capital Construction Total Capital Expenditure 2007 $ 501,361 2006 $ 573,491 2007 $ 2006 $ 232,467 17,752 4,634 44,377 36,522 700 336,452 210,143 15,669 4,914 58,071 11,588 667 301,052 1,688,406 1,688,406 781,211 781,211 Value Added Tax 238,217 108,585 TOTAL EXPENDITURE
 2,263,075 1,190,848 National Reconciliation Unit 2007 Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Special Expenditure Total Operating Costs Value Added Tax TOTAL EXPENDITURE 2007 $ 2006 $ 199,222 23,374 14,590 22,451 29,075 285,014 573,726 38,805 612,531 - - - - - - - - - Telecommunication Regulatory Unit 2007 Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Total Operating Costs Department of Information 2007 $ 2006 $ - - - - - - - 264,659 8,274 22,677 16,582 8,165 156,262 476,619 Section 15: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description Value Added Tax TOTAL EXPENDITURE 2007 $ 2006 $ - - 33,320 509,939 Appendix 15.2 : FNPF Reconciliation (a) Total FNPF against salaries and wages for 2007 FNPF as per the financial statement- Established Staff - Unestablished Staff - Project Staff 82,063 9,031 2,270 Add: December 2007 FNPF paid in Jan 2008 Less: December 2006 FNPF paid in Jan 2007 FNPF Payments for 2007 Gross pay subject to FNPF ($90,102 divide by 0.08) (b) Salaries and wages for 2007 subject to FNPF: Salaries, wages and allowance as per financial statement – Established Staff - Unestablished Staff - Project Staff 1,208,026 135,501 73,825 Less: Salaries, allowance and wages not subject to FNPF.
Variance $ 93,364 9,145 102,509 12,407 90,102 1,126,275 1,417,352 1,417,352 - 1,417,352 291,077 Department of Information Section 15: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 16 Fiji Military Forces Programme Statement Under Republic of Fiji Military Forces Act CAP 81, the RFMF is charged with, and responsible for the defence and state security of Fiji in the maintenance of Law and Order in land and sea, in support of the Police, Maritime Surveillance of Fiji’s Maritime Zone and relevant departments.
It also provides forces to international peacekeeping operations in line with Government foreign policy on world peace, troops with engineering expertise for nation building, in the area of rural infrastructure development and youth training for life skills.

In relation to these tasks, the following deliverables or responsibilities are undertaken in the following budgeted activities: Infantry Battalion Converts Policy & Administration • Strategic Analysis and Policy Advice to Commander RFMF.
• Strengthen defence co-operation with other forces.

Logistic Support Unit • Purchase of Stores & Supplies • Provide medical and maintenance services 3 FIR • Regular Infantry training and exercise • Assistance to Police Team • Security Role • Disaster Response FMF Engineers • RFMF Youth Trade Training • FMF Naval Division Law Enforcement at Sea • • Search and Rescue Service • Underwater Explosive Ordinance Disposal.
Territorial Forces • Support Service to Infantry Battalion & Peacekeeping Operations Overseas.

Iraq Mission • Deployment of troops to the United Nations Assistance Mission Iraq.
Peacekeeping Force, Sinai • Provision of Peacekeeping troops to MFO Force Training Group • • Promotions Training • Overseas deployment training Land Force Command • General Administration and Operation of Land Forces Training of New Recruits Table of Contents 16.1 16.2 16.3 16.4 16.5 16.6 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditures ..................................................................... 3 Statement of Output Costs........................................................................................... 3 Appropriation Statement .............................................................................................. 3 Statement of Losses .................................................................................................... 4 Trading and Manufacturing Activity – Profit and Loss Statement ................................. 4 AUDIT FINDINGS ................................................................................................................................. 5 Agency Financial Statements....................................................................................... 5 Section 16: Page 1 16.7 Fiji Military Forces REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Excessive Over-Expenditure........................................................................................ 5 16.8 Trust Fund Account...................................................................................................... 6 16.9 Purchase and Payments of Military Stores/Equipment ............................................ 8 16.10 Quarters Deductions and Overpayment of Lodging Allowance.............................. 10 16.11 Accounting Records Not Properly Maintained
 ....................................................... 11 16.12 Tenders Not Called For Supply of Goods and Services......................................... 12 16.13 Discrepancies in Payments ................................................................................... 13 16.14 Supply of Fresh Vegetable and Root Crops........................................................... 15 16.15 Supply of Meat, Egg and Dry Goods ..................................................................... 16 16.16 Excessive Purchase of Vaccines ........................................................................... 18 16.17 Storage of Vaccine ................................................................................................ 19 16.18 Recording of Pharmaceutical Stores ..................................................................... 20 16.19 Business Plan - Plant Pool .................................................................................... 21 16.20 Preparation of Financial Statements – Plant pool .................................................. 22 16.21 Discrepancies in the Records – Plant Pool and Accounts Section......................... 22 16.22 Arrears of Revenue – Plant Pool ........................................................................... 23 16.23 Unaccounted Fuel ................................................................................................. 24 16.24 16.25 Private Funds – Fines Account .............................................................................. 25 Appendix 16.1 – Statement of Output Costs........................................................................... 26 Appendix 16.2: Arrears of Revenue – Plant Pool ................................................................ 31 Appendix 16.3: Outstanding Debts – plant pool................................................................... 33 FINANCIAL STATEMENT 16.1 Audit Opinion The audit of the 2007 accounts of the Fiji Military Force
 resulted in the issue of a qualified audit report.
The qualifications are as follows.

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

It is not possible therefore to determine the accuracy of the expenditures incurred by the Force under each output.
The Force has not provided a Trust Fund Account Statement of Receipts and Payments contrary to Finance Instructions 82(1).

The Financial Management Information System shows that the Force as at 31/12/07 had operating trust funds totalling $2,074,387.

The Force incurred over expenditure of $45,454,514 in 2007.

Although Cabinet has approved that the Minister of Finance validate the over expenditure, funds were not re- deployed to the budgetary allocations for RFMF to off set the over expenditure.
Fiji Military Forces Section 16: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 16.2 Statement of Receipts and Expenditures The Fiji Military Forces incurred a total expenditure of $126,285,114 in 2007 compared to $100,247,861 in 2006.
Table 16.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Agency Revenue TOTAL REVENUE EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Expenditure Capital Expenditures Capital Construction Capital Purchase Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ Value Added Tax 7,862,525 9,864,197 TOTAL EXPENDITURES 126,285,114 100,247,861 16.3 Statement of Output Costs The Statement of Output Costs consolidates the 6 outputs prescribed in the Budget Estimates.
These are detailed in Appendix 16.1.

16.4 Appropriation Statement The Fiji Military Force incurred expenditures totalling $126,285,114 in 2007 against the budget of $80,739,600 resulting in an over-expenditure of $45,545,514 or 56%.

Details of expenditures against the budget estimates are provided in Table 16.2.
Fiji Military Forces Section 16: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 16.2: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase Services Special Expenditure Total Operating Costs of Goods & Capital Expenditure Construction Purchases Grants & Transfers Total Capital Expenditure Budget Estimate $ 62,999,100 250,300 502,400 2,709,800 3,922,400 704,500 71,088,500 500,000 180,000 0 680,000 13 Value Added Tax 8,971,100 TOTAL EXPENDITURE 80,739,600 16.5 Statement of Losses Changes $ 0 0 0 0 0 0 0 0 0 0 0 0 0 Revised Estimate $ 62,999,100 250,300 502,400 2,709,800 3,922,400 82,623,677 252,666 1,634,152 3,744,285 29,943,740 704,500 71,088,500 113,778 118,312,298 500,000 180,000 0 680,000 0 110,291 0 110,291 8,971,100 7,862,525 80,739,600 126,285,114 Actual Expenditure $ Carry– Over $ Lapsed Appropriation $ 0 0 0 0 0 0 0 0 0 0 0 0 0 (19,624,577) (2,366) (1,131,752) (1,034,485) (26,021,340) 590,722 (47,223,798) 500,000 69,709 0 569,709 1,108,574 (45,545,514) The RFMF did not report any loss of money or fixed assets during the financial year ended 31/12/07.
16.6 Trading and Manufacturing Activity – Profit and Loss Statement A profit of $3,855 was recorded in the Trading & Manufacturing account for 2007.

Details are provided in Table 16.3.
Table 16.3: Profit and Loss Statement for 2007 Description INCOME Sales Cash Total Income EXPENSES Fuel & Oil R & M of Fixed Assets Special Fees & Charges VAT TMA Total Expenses NET PROFIT 2007 ($) 158,055 158,055 21,480 123,316 220 9,183 154,199 3,855 Fiji Military Forces Section 16: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 AUDIT FINDINGS 16.7 Agency Financial Statements Commencing 2006 financial year, each annual report must include financial statements which have been prepared and signed in accordance with the Finance Instructions, audited by the Auditor General, and accompanied by an audit opinion prepared by the Auditor General.1 The draft financial statements must be submitted to the Auditor General by 31 March in the following year, or within such other time as agreed to with the Auditor General.2 The Fiji Military Forces submitted its Agency Financial Statement for audit on 13/05/08 and was not prepared in accordance with section 82 and Schedule 1 of the Finance Instructions 2005.
A lot of changes were made and the accounts were re-submitted late.

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

It is not possible therefore to determine the accuracy of the expenditures incurred by the RFMF under each output.
In addition, a variance of $594,909 was noted between the total costs of the Statements of Output Cost and the total expenditures in the Statement of Receipts and Payments for 2006.

• A Trust Fund Statement of Receipts and Payments was not submitted for audit.

• The Profit and Loss Statement for the Trading and Manufacturing Activity was incomplete.

The comparative figures for 2006 were not provided in the financial statements.
Non compliance with Finance Instructions in the preparation of the financial statements has restricted the scope of the audit.

Recommendation The RFMF should ensure that the requirements of the Finance Instructions are strictly followed in the preparation of the Agency Financial Statements.

Management Comments Management comments were not received.
16.8 Excessive Over-Expenditure No officer may incur expenditure which results in the agency’s appropriation being exceeded without the proper authorisation of the Ministry of Finance, pending approval by Parliament.3 1 Finance Instructions 2005 – 81 (2) 2 Finance Instructions 2005 – 81 (3) 3 Finance Instructions 2005 – Section 8 Fiji Military Forces Section 16: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Audit analysis of the Expenditure Statement for the year ended 2007 revealed that the RFMF had over spent its annual budget allocations for Established Staff, Travel and Communication, Maintenance and Operation and Purchase of Goods and Services.
The total over-expenditures for the four SEGs amounted to $47,812,154.
Refer to Table 16.4 for details: Table 16.4: Details of Over Expenditures SEG Description 1 3 4 5 Establish Staff Travel and Communication Maintenance and Operation Purchase of Goods and Services Budget Allocation ($) 62,999,100 502,400 2,709,800 3,922,400 Expenditure ($) 82,623,677 1,634,152 3,744,285 29,943,740 Total Variance ($) (19,624,577) (1,131,752) (1,034,485) (26,021,340) $47,812,154 Variance (%) 31 229 29 662 Excessive over-expenditures are a clear indication of mismanagement of public funds and ignorance of standing financial instructions.
Recommendations • The senior officers of the RFMF should ensure that the RFMF operates within its budget.

• Expenditures should be reviewed against the budget allocation on a monthly basis and reported to management for effective and efficient decision-making.

Management Comments Management comments were not received.

16.9 Trust Fund Account When invoices or claims for payments are received, the payables officer shall record details in an accounts payable ledger.
The accounts payable ledger shall record all claims for payment except for procurement invoices, which shall be recorded in the commitment ledger.4 Within 3 days of receiving the monthly general ledger reports from the Ministry of Finance, the Accounts Officer shall reconcile the ledger balances to the general ledger reports and prepare a ledger reconciliation statement.
Any errors or misallocations must be immediately adjusted by way of journal vouchers.5 The Trust Fund Account should not be overdrawn.6 According to Appendix 23B of the Accounts and Finances, the balance of the operating trust fund account as at 31/12/07 was $2,074,387.

The Trust Fund records revealed that reconciliations for 55 Trust Fund accounts were not prepared for the months of January to November.
Although the reconciliation for December 2007 was submitted for audit, the accuracy of the reconciliation is questionable.

4 Finance Manual-Fiji Military Forces 2005.

Section 13.1.1 5 Finance Manual-Fiji Military Forces 2005.
Section 16.3.3 – 16.3.4 6 Office of the Auditor General Trust Fund Guide (5) Fiji Military Forces Section 16: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 A total of 34 Trust Fund accounts had debit closing balances, which indicate that they were overdrawn.

Refer to Table 16.5 for details: Table 16.5: Overdrawn Trust Fund Accounts No.

Account No.
Account name Debit Closing Balances (Overdrawn) - $ 1-19101-19999-860103 1-19101-19999-861307 1-19101-19999-861902 1-19101-19999-861920 1-19101-19999-861105 1-19101-19999-861204 1-19101-19999-861299 1-19101-19999-861308 1-19101-19999-861401 1-19101-19999-861501 1-19101-19999-861502 1-19101-19999-861504 1-19101-19999-861505 1-19101-19999-861532 1-19101-19999-861601 1-19101-19999-861602 1-19101-19999-861605 1-19101-19999-861606 1-19101-19999-861608 1-19101-19999-861609 1-19101-19999-861611 1-19101-19999-861702 1-19101-19999-861706 1-19101-19999-861715 1-19101-19999-861716 1-19101-19999-861799 1-19101-19999-861906 1-19101-19999-861911 1-19101-19999-861603 1-19103-19999-861920 1-19107-19999-861999 1-19110-19999-861599 1-19106-19999-861533 1-19106-19999-861521 Tender deposit Home Finance Deposits Account Receivable FNPF Public Rental Board LICI PD Others FDB housing Rent refund Fiji Public Service Association Fijian Teachers Union Fiji Reg.
Nurse Assn Viti National Union Public Employees Union Maintenance Suva Maintenance Nausori Maintenance Ba Maintenance Lautoka Maintenance Nadi Maintenance Sigatoka Maintenance Labasa Maintenance Savusavu Rates Nausori Rates Lautoka Rates Lami Rates Nasinu Rates Other CAMV Sports & Social Miscellaneous Fund Open Item PD Employees benefit Payroll Others Wesram Finance Sacred Heart Fiji Nursing Association TOTAL Failure to carry out regular monthly and accurate reconciliations is a breach of the Finance Instructions.
The closing balance of the Trust Fund reconciliation for December cannot be relied upon as correct since reconciliations were not prepared for the months of January to November 2007.

Recommendations • The Accounts Officer should ensure that Trust Fund reconciliations are carried out monthly.
Fiji Military Forces Section 16: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The Officer in charge of the Accounts Sections should be held accountable for failing to comply with the Finance Instructions regarding the preparation of reconciliations for the Trust Fund accounts.

• Supervisory checks on monthly reconciliations should be improved.

Management Comments Management comments were not received.
16.10 Purchase and Payments of Military Stores/Equipment Tenders must be called for the procurement of goods, services or works that cost over $20,000.7 The Officer in Charge of the accounts must not certify a payment as correct unless they are satisfied that there is documentation that goods, services or works have been received.8 The RFMF was allocated $964,928 under SEG 5 of the 2007 Budget Estimate for purchase of various military stores and camp equipment.
According to various correspondences sighted during the audit, the RFMF purchased various military stores and equipments from several suppliers costing $21,148,852 for which funds were not allocated in the budget.

This resulted in an over expenditure totalling $20,183,924.

Standard government procurement procedures such as obtaining approval from the Major Tenders Board were not complied with.
However, the RFMF later sought retrospective approval from the Minister for Finance through a Cabinet paper IGCP (07)291 for the over-expenditure and waiver of approval by the Major Tender Boards.

In seeking retrospective approval, the RFMF stated that the expenses incurred were essential for the events of 5th December 2006.
In its meeting on 14/08/07, Cabinet approved that the Minister of Finance exercise his powers under Section 34 of the Financial Management Act to validate the excess expenditures of $21,148,852.

Physical verification of goods that was carried out during the audit indicated that some stores have yet to be received by the RFMF although payments had already been made.

Refer to Table 16.6 for examples: Table 16.6: Items paid but not received Schedule Ref.

1 1 1 1 1 1 S/ No.
Description of Goods Supplier 01 02 03 05 06 13 Rip Stock Socks Green Army/Navy Accessories Hat Jungle Staple Belt Parker Nylon Green Lotus Garments Lotus Garments Lotus Garments Crown Imports Deluxe Footwear Lotus Garments 7 Finance Instructions 2005 Section 12(4) 8 RFMF Finance Manual s 2.8.3(ii) Fiji Military Forces Amount Paid ($) Status/Comments 696,000 Only $218,080.00 worth of goods received 65,000 Goods not received 2,878,633.50 Goods not received 75,000 Goods not received 96,000 Goods not received 506,000 Goods not received Section 16: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Schedule Ref.
2 2 2 2 S/ No.
Description of Goods Supplier 01 04 06 08 UN Accrouments Stretcher bed uniforms Military Tentage Infantry camping stores Total Lotus Garments Crown Imports Daewoo Ltd Lalas Bargain Amount Paid ($) Status/Comments 99,500 Goods not received 125,950.00 Goods not received 736,305.00 Goods not received 57,375.00 Goods not received 5,335,763.5 A physical verification of the items purchased revealed that most have not been used and were lying idle in the Store Room and items such as Hat Jungle and Anti Blastic Glasses were not needed in 2007 because there were stock left from previous years or not used during the year.
Refer to Table 16.7 for details: Table 16.7: Over stocking of items S/No.

Order No.
Description Supplier Cost ($) Quantity Purchased Quantity Received Quantity Not Used 05 07 11 12 07 08 03 019102-824 Hat Jungle 019102-826 Beret Green - - 019102-1795 019102- 824 019102- 653 Ballistic Polytherm Box – 40 litres Polytherm Box – 35 litres Anti Glasses Thermo Green RFMF Ceremonial Dress Rip Stock Mat Crown Imports Deluxe Footwear Crown Imports Crown Imports Daewoo Ltd Crown Imports Lotus Garments Lotus Garments 75,000 3,000 3,000 3,000 105,000 3,000 3,000 2,130 19,900 28,500 - - 100 100 51 95 736,305 4,000 4,000 4,000 135,000 1,500 1,500 768 147,000 1,200 1,200 1,100 696,000 22,000 3,760 1,293 01 019102- 817 * Details such as LPO number and quantity for purchase of Polytherm 40 litres and 30 litres box were not provided.
Some of the stores purchased did not relate to the event of 5th December 2006.

These included purchase of Protective Equipment from Lotus Garments for $4,496,750 and Anti Blastic Glasses from Intouch.Net/Daewoo Limited for $680,000, which were purchased specifically for overseas missions.

The above issues have been constantly raised in the previous year’s audit reports and indicate RFMF’s continuous disregard of government financial regulations pertaining to purchases and payments of goods and services.
Recommendations • The RFMF should adhere to the policies, procedures and guidelines as per RFMF Finance Manual 2005 for procurement of goods and services.

• Excessive purchasing of goods and services not budgeted for should be avoided.

Fiji Military Forces Section 16: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments Management comments were not received.
16.11 Quarters Deductions and Overpayment of Lodging Allowance All officers occupying Government quarters of whatsoever type or self contained flats will be required to pay rent at the rate of 8% of basic salary with maximum limits of rent for different grades of quarters as follows.9 GRADE RENTAL PER ANNUM ($) Special Grade Grade I and II Grade III Grade IV Grade V Grade VI and below 1,600 1,400 1,200 1,000 720 480 The Commander might grant to married soldiers, up to and including Warrant Officers, a lodging allowance to help pay the cost of rent, water and lighting charges incurred while they are not in occupation of an official quarter.10 Lodging allowance will not be paid from the date of allocation of any army quarter.11 A follow-up on the issues raised in 2006 revealed that direct salary deductions have commenced for those highlighted in the report.
However, the fortnightly deductions of $50 for Mr. Esala Teleni ceased from Pay 19/07 when he was appointed Commissioner of Police.

The balance of $2,722.90 has yet to be recovered.

A review of a sample of the RFMF Officers Housing Allocation (QEB) and the Other Ranks Married Quarters and Tenancy Return revealed that officers were still occupying Grade IV government quarters without any quarter’s deductions or occupying army quarters and also receiving lodging allowances.
Refer to Table 16.8 for details: Table 16.8: Outstanding deductions and unpaid lodging allowances Reg.

No.
No.

Officers’ Name Unit Date Occupied The Quarters Quarters Total Deductions Owed ($) Outstanding Quarters Deductions: 25077 Major Jonisio Mara Overpaid Lodging Allowances: 26607 27163 LCPL Vatemosi To CPL Wame Vueti Strategic HQ 17/02/07 230.76 QEB SVC SPT ENGR 23/11/05 03/05/02 1,598.50 322.00 The lack of communication between Commanders of these different units and the Payroll Section resulted in these overpayments of lodging allowances.
9 General Orders 607 10 RFMF Standing Orders Volume 1 – Paragraph 17.55 11 RFMF Standing Orders Volume 1 – Paragraph 17.58 (b) Fiji Military Forces Section 16: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • Payment of lodging allowances to those officers who are not eligible to receive such allowances should be recovered from them.

• Direct salary deductions should be instituted to recover outstanding rent.
• The RFMF should ensure that respective Commanders of each units and stations inform the Payroll Section when an officer moves into an allocated Army Quarters.

• Officers should be made aware of the RFMF Standing Orders and that it is also their individual responsibility to inform the Administration and Accounts Sections if they are receiving allowances they are no entitled to.
Management Comments Acknowledge and confirm issues raised above, however the following was highlighted during discussions with the audit team when the matter was brought to our attention: a.

The amount owed by Commodore Teleni [$2,722.90] as rent arrears can no longer be recovered through the RFMF payroll as his salary has since been processed by the police force thus the cessation of deduction as a recovery measure.

b.
b.

The overpayment of lodging allowance to soldiers provided with official quarters is a recurring issue, as it is an administrative issue as correctly highlighted by the auditors.

Overpayments as shown in the table above have been fully recovered by way of deductions from pay.

Reconciliation of the payroll with the force-housing list is ongoing as a measure to avoid or minimize overpayments.
16.12 Accounting Records Not Properly Maintained All local purchase orders, indents and other commitments of funds are to be recorded in the financial management information system or a commitment ledger immediately after they have been approved.12 All payments, including VAT, must be immediately recorded in the financial management information system or an Expenditure Ledger.13 The implementation of the FMIS at the RFMF came into effect on 01/07/07.
As such, all commitments and expenditures incurred for the period 01/01/07 to 30/06/07 should be maintained manually in the Commitment and Expenditure Ledgers.

The RFMF did not adequately maintain an accurate and updated Expenditure Ledger and Cash Book for the period 01/01/07 to 30/06/07.

Several allocations in the Expenditure Ledger have large number of transactions that were not recorded, which resulted in significant variances, when compared with the Cash Book.
Refer to Table 16.9 for details: Table 16.9: Details of Variances ALLOCATIONS Vaccination/Reagents Local Travel 12 Finance Instruction 2005 Section 18 13 Finance Instruction 2005 Section 20 Fiji Military Forces EXPENDITURE LEDGER BALANCE ($) 3,000 420,023 CASH BOOK BALANCE ($) 231,648 592,758 VARIANCE ($) 228,648 172,735 Section 16: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 ALLOCATIONS Fuel & Oil Laundry Services Telecommunication Power supply Water sewerage and fire charges EXPENDITURE LEDGER BALANCE ($) 206,881 16,740 264,751 284,618 16,947 CASH BOOK BALANCE ($) 428,718 51,898 236,008 386,231 18,432 VARIANCE ($) 221,837 35,158 (28,743) 101,613 1,485 The above balances are for the period of 6 months only (1/1/07 – 30/6/07) Payments made for the periods 14/5/07 – 30/5/07 and 12/6/07 – 31/10/07 were also not recorded in the Cash Book.
The above indicates poor supervisory checks and controls in the Accounts Section.

Failure to properly maintain Commitment/Expenditure Ledger and Cash Book increases the risk of fraud and misappropriation of public funds and could also result in double payments and mispostings of expenditures.

Similar issues have been raised in the previous audit reports.

Recommendations • The RFMF should update its books for 2007.

• Supervisory checks and controls in the Accounts Section should be improved.
• Since this issue has been continuously raised in the audit report, the RFMF should consider disciplinary action against officers responsible for maintaining the Expenditure Ledger and Cash Book.

Management Comments Recommendations have been noted.
The Expenditure Ledger has now been updated for 2007 and the RFMF will ensure that internal control measures be put in place to address this on going issue 16.13 Tenders Not Called For Supply of Goods and Services The Chief Executive Officer must obtain at least 3 written competitive quotes for any procurement of goods, services or works that cost more than $100 but less than $20,000.14 Tenders must be called for the procurement of goods, services or works that cost over $20,000.15 The RFMF purchased goods and services totalling $1,125,030 from a preferred selection of suppliers that did not go through the normal tender process nor were competitive quotations obtained for supply of goods and services.
Refer to Table 16.10 for details: 14 Finance Instructions 2005 12(1) 15 Finance Instructions 2005 12(4) Fiji Military Forces Section 16: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 16.10: Payment to other suppliers Suppliers Goods/Services Obtained Suncourt Hardware Vinod Patel Parmars Footwear Priyas Laundry Kasabia Mass Stationery Extreme Stationery Dee Cees TOTAL Supply of building materials and hardware Supply of building materials and hardware Supply of desert military boots For laundry services Supply of building materials and hardware Purchases of stationeries Purchase of stationeries For Transportation Services Cost Of Goods/Services Obtained During 2007 ($) 204,793.00 50,439.00 87,200.00 51,898.00 30,613.00 390,589.30 202,087.73 107,410.00 1,125,030.03 While the need of service may be urgent, it certainly does not necessitate deviations from policies and guidelines governing the purchase of good and services.
Failure to do so could result in unauthorised procurements and over-expenditures.

Recommendation The RFMF should adhere to the procurement policies and guidelines in the Finance Instructions 2005 and the RFMF Finance Manual.

Management Comments The purchases highlighted above were part of the $21m approval by cabinet for the waiver of the Tender Board process and the Minister of Finance’s retrospective approval for the validation of ‘Operation Sasamaki’ accounts and purchases’.
Refer to IGCP (07)291 dated 14 Aug 07.

Validation of expenses incurred by RFMF.

16.14 Discrepancies in Payments A local purchase order (LPO), indent, departmental warrant, contract or agreement must be issued before goods, services and works are received.16 Payment should be made on original invoices.

The RFMF purchased stationery and office supplies costing $271,508 from Mass Stationery in 2007 where in numerous instances local purchase orders were not issued.
Refer to Table 16.11 for examples: Table 16.11: Payments made without LPO DATE SUPPLIER 14/01/06 14/01/06 14/01/06 16/07/06 20/07/06 24/07/06 24/07/06 24/07/06 11/08/06 Mass Stationery Mass Stationery Mass Stationery Mass Stationery Mass Stationery Mass Stationery Mass Stationery Mass Stationery Mass Stationery 16 Finance instructions 2005 17(2) Fiji Military Forces INVOICE NO.
23191 23192 23707 24220 23782 24221 23773 23783 24219 AMOUNT ($) 2,760.00 2,835.00 2,530.45 1,820.00 1,160.50 2,550.00 1,450.00 1,149.60 1,580.00 PARTICULARS 4 m/y hp016 5 canon E30 4boxcomp file 4 only photocopier 3128MB USB 5HP 96A 50 only biding tape 4 box suspension file 4 only Samsung toner Section 16: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 DATE SUPPLIER 14/08/06 26/08/06 10/09/06 15/09/06 20/10/06 20/12/06 Mass Stationery Mass Stationery Mass Stationery Mass Stationery Mass Stationery Mass Stationery INVOICE NO.
23784 24253 23193 24254 24256 23772 AMOUNT ($) 89.00 2,835.00 2,465.60 1,580.00 1,750.00 2,045.00 PARTICULARS 1 ream ruled fulscap 5 canon toner 4 only USB drive 4 Toshiba toner 5 minolta dnr 3 photocopier toner Verification of payment vouchers noted instances where payments for goods and services were processed based on photocopied invoices and supporting documents.
Refer to Table 16.12 for examples: Table 16.12: Payment made on photocopied invoices DATE 10/11/06 23/11/06 30/11/06 30/11/06 08/12/06 31/12/06 09/01/07 09/01/07 16/01/07 14/02/07 23/03/07 12/06/07 25/06/07 25/06/07 12/12/07 VOUCHER NO/ORDER NO AMOUNT ($) SUPPLIERS DISCREPANCY 676536 672808 672862 672863 672934 673371 673500 673547 673785 674645 9180 761035 674143 674810 8006 825.00 Hanson Supermarket 679.40 Tebara Halal Meats Ltd 849.00 Tebara Halal Meats Ltd 341.00 Tebara Halal Meats Ltd 366.80 Tebara Halal Meats Ltd 6,748.50 Tebara Halal Meats Ltd 391.00 Tebara Halal Meats Ltd 1,143.00 Tebara Halal Meats Ltd 970.00 Tebara Halal Meats Ltd 2,060.00 RFMF Farm 7,691.60 Wingate Marketing Ltd 1,277.80 RESL 6,720 Penlass Glass 1,052.21 Vinod Patel line 18,510.00 Top Services Ltd Electrical Payments made based on photocopied invoices.
Payment voucher could not be identified.

No invoice attached to payment voucher.

No supporting documents attached to payment voucher.

No invoice attached to payment voucher.

Payment voucher could not be located.

The issue has been continuously highlighted in the previous audit reports, however, the RFMF has yet to take heed of the audit recommendations and comply with the relevant finance instructions.
The risks of fraud, misappropriation and double payments are high if the RFMF continues to ignore internal controls that are in place.

Recommendations • The RFMF must ensure that purchase orders are issued for all purchases made.

• Splitting of LPOs to avoid proper approvals should cease and disciplinary actions should be instituted on those that do not comply with the Finance Instructions.

• Processing of payments should be made according to the Finance Instructions 2005.
• The RFMF should cease making payments on the strength of photocopied invoices and LPO’s.

• Officers who continue to deviate from the finance instructions in carrying in their duties should be disciplined.

Fiji Military Forces Section 16: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments We acknowledge that this is contradictory to Government Finance Regulations.
However, we had to resort to using photocopied invoices to effect payment when the original copies cannot be located.

Misplacement of original copies of invoices was the result of the relocation of accounting offices and movement of documents within the offices during the reporting period.

Under these circumstances, we had checked and confirm that there were no payments done prior.
16.15 Supply of Fresh Vegetable and Root Crops Purchases of goods and services should be made from the suppliers approved by the Major Tenders Board.
A report shall be submitted to the Controller of Government Supplies by the Head of Department concerned in the event of unsatisfactory performance by the contractor.17 The Major Tender Board in its meeting on 15/12/05 awarded the tender18 for supply of fresh vegetables and root crops to RFMF to Qalovakawalu Farmers (first option) and Draidrai Enterprise (second option).
While the RFMF purchased fresh vegetable and root crops from the approved suppliers, 98% of its supplies were purchased from suppliers other than those approved by the Major Tender Board.
Refer to Table 16.13 for details: Table 16.13: Purchases from other suppliers NAME Qalovakawalu Farmers (Supplier approved by MTB) Draidrai Enterprise (Supplier approved by the MTB) Joes Farm Freshet International RFMF Farm TOTAL COST OF SUPPLIES PURCHASED - 2007 ($) 16,039.25 2,552.85 330,362.00 431,059.00 438,864.44 1,218,877.54 % OF TOTAL SUPPLIES PURCHASED 1.3% 0.2% 27.0% 35.5% 36.0% The approved suppliers were not able to provide the sufficient quantity and quality of goods as required by the RFMF, which implied that the suppliers approved by the Major Tender Board did not have the capacity to provide consistent supply of goods to the RFMF.
As such the RFMF have made purchases from other suppliers at prices higher than the contracted prices.

Minutes of various meetings of the Logistic Support Unit revealed that the Controller of Government Supplies has not responded to the problem faced by the RFMF regarding the supply of fresh vegetables and root crops.
There were also instances where descriptions of the product supplied by certain suppliers were not properly stated on the invoices, making it difficult to ascertain whether correct prices were charged for the supply of goods.
Refer to Table 16.14 for examples: 17 Supplies and Services Instructions 38 18 Tender No CTN 06/2005 Fiji Military Forces Section 16: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 16.14: Unclear description on invoices SUPPLIERS ITEM Carrots English cabbage Joes Farm Garlic pre packed Mixed vegetables Orange AUDIT COMMENTS Price for local and imported carrots defers.

The invoice does not state whether it’s local or imported product.
Price for local and imported English cabbage defers.

The invoice does not state whether it’s local or imported cabbage.

Price for garlic depends on the weight per pack.

The invoice does not state the weight per pack of garlic supplied.

Price for mixed vegetables depends on the weight per pack.

The invoice does not state the weight per pack of mixed vegetables.

Local and imported oranges have different prices.

The invoice does not state whether it’s local or imported orange.
If the product description and prices are not clearly stated on the invoices, the officer receiving the goods would not be in a position to adequately determine if the prices charged by suppliers are correct.

Procurement of goods and services from suppliers other than those approved by the Major Tender Board implied unauthorised purchases.

Recommendations • The RFMF should continue to report to the Controller of Government Supplies instances of • unsatisfactory performance by the approved contractors.
Invoices should be verified upon delivery of goods and if prices differ from the price list, suppliers should be notified immediately.

Management Comments This is to record that RFMF made formal consultations with representatives from Government Supplies in regards to the inconsistent service provided by Suppliers authorized by the Major Tender Board.
The demand for the commodities in question comes daily and therefore RFMF cannot wait for delayed responses because we need to feed our troops and as a consequence we turn to other reliable suppliers when the approved supplier could not meet our demands.

We have done this on many occasions through consultation with the suppliers to rectify the problem.
We have our reputable and consistent suppliers that lost out in the bid and were not considered by the Major Tender Board because of the requirement of the SDL Government through the Social Justice Act to promote indigenous business participation.
Qalovakawalu Farmers and Draidrai Enterprises were two indigenous businesses that were awarded first and second preference respectively by the Major Tender Board, but our dealings with Qalovakawalu Farmers were inconsistent and ultimately they gave way to more consistent suppliers when they were not able to sustain the demand we placed on them.
We had advised the supplier that they will have to remain with the contracted price even if they have to supply imported items to RFMF during the off season locally.

16.16 Supply of Meat, Egg and Dry Goods Purchases of goods and services should be made from the suppliers approved by the Major Tenders Board.
Fiji Military Forces Section 16: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 A report shall be submitted to the Controller by the Head of Department concerned in the event of unsatisfactory performance by the contractor.19 The Major Tender Board in its meeting 15/2005 of 6/09/05 awarded the tender for the supply of various frozen foods to Tebara Halal Meat, Pacific Organic Ltd,, Joe’s Farm, Fresh’et and Ashabahi & Co.
The main supplier of dry goods is Government Supplies Depatrtment.

The RFMF incurred expenditures of more than $1 million annually for the supply of meat, eggs and dry goods from various local suppliers.

Suppliers other than those approved by the Major Tender Board were engaged to supply meat, eggs and dry goods.

The total costs of goods provided by these suppliers are shown in Table 16.15.
Table 16.15: Purchases from other supplies other than MJTB approved Suppliers Rooster Poultry Ltd Ram Sami & Sons Ltd New Word Supermarket Hansons supermarket Wing Sang Co Ltd Total Total Cost For 2007 ($) 117,787 30,792 92,124 95,885 114,218 $450,806 Other suppliers were sought due to the inconsistent method of supply and poor quality of meat supplied by approved contractors.

There were no formal contracts between the RFMF and these suppliers for supply of meats, eggs and dry goods.
The quality and service requirements were not defined up front therefore the performance of suppliers could not be monitored.

In addition, without the agreed price lists, suppliers may apply different rates or charge premium depending on the demand and supply in the market.

For example, some suppliers have provided price lists and informally agreed to supply their produce at fixed prices for the year.

However, audit noted instances where suppliers were charging prices higher than what had been agreed.
Refer to Table 16.16 for examples: Table 16.16: Anomalies in prices charged Suppliers Item Unit Rate On Price List ($) Rate Charged ($) Tebara Halal Meat Ltd Joes Farm Lamb shank Grade 1 Fish Boneless Lamb Bhaji Pumpkin Frozen mixed vegetables 1 Kg 1 Kg 1 Kg 1 Kg 1 Kg 1 Kg 7.05 6.50 6.50 0.80 0.80 2.88 7.06 8.50 7.28 1.50 1.00 3.00 Variance ($) 0.01 2.00 0.78 0.70 0.20 0.12 Procurement of goods from suppliers other than those approved by the Major Tender Board has resulted in the RFMF paying more than the approved rates.
19 Supplies and Services Instructions 38 Fiji Military Forces Section 16: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • Major Tender Board’s approval must be obtained when selecting suppliers of goods and services.

• The RFMF should continue to report to the Controller of Government Supplies instances of unsatisfactory performance by the current approved contractors.
• The RFMF should make payments according to the price lists provided by the suppliers unless prior approval has been sought.

Management Comments The Major Tender Board’s approval and selection for the suppliers to be used is understood.

However, RFMF experienced inconsistency and unreliable service from some of the contracted suppliers and has no option but to resort using more consistent and reliable ones that meets RFMF overall needs.
The delay by the Controller of Government Supplies in responding to our concerns contributed to RFMF resorting to other suppliers for better service outputs.

Payments are made according to contracted prices.

16.17 Excessive Purchase of Vaccines Pharmacy services are an integral part of a comprehensive health care delivery system at the RFMF.
The principal purpose of the pharmacy services is to assure efficient, safe, and cost-effective drug therapy and appropriate outcomes in the use of drugs and medicines within RFMF.

The success of any immunization program relies on the ability of providers to have access to vaccine supply on a timely and cost effective manner.
While ensuring this process is not compromised, it is also important to be aware that poor ordering practices can lead to inappropriate levels of stock being placed at a risk of wastage at each level of storage.

In 2007, the RFMF was allocated $152,40020 for the purchase of vaccination/reagent and medical stores.

Vaccines costing $231,648 were purchased from Budget Pharmacy resulting in an over- expenditure of $79,248.

The over expenditure was later validated through a Cabinet Decision of 14/08/07.
A large quantity of these vaccines was not used and is stored at RFMF pharmacy, which indicated that excessive vaccines were purchased in 2007.
Refer to Table 16.17 for details: Table 16.17: Excessive purchases of drugs Vaccine Quantity Purchased (Ampoule) Quantity Used (Ampoule) Quantity Not Used ($) Typhoid Fever Yellow Fever Mencevax Oral Polio Hepatitis A Hepatitis B Tetox DPT 926 726 926 71 926 562 728 403 104 626 66 483 211 497 523 622 300 5 443 351 231 Cost Of Quantity Not Used ($) 26,906 31,243 15,456 10 38,047 8863 1086 20 $70,000 was allocated under Activity 2 for medical stores, $36,400 was allocated under Activity 8 for vaccination/reagent and $46,000 allocated under Activity 10 for vaccination/reagent Fiji Military Forces Section 16: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Vaccine Quantity Purchased (Ampoule) Quantity Used (Ampoule) Quantity Not Used ($) Total 4,865 2,369 2,475 Cost Of Quantity Not Used ($) 121,611 Overstocking of supply of vaccine is a waste of public funds.
Overstocking is also not prudent with the limited adequate storage facilities.

Recommendation The RFMF should carefully forecast vaccine required depending on the number of overseas mission to determine the level of stock to be procured for the year.

Vaccine should be sufficient to withstand temporary disruption in the supply and possibly meet reasonable demands as a result of unplanned deployment to overseas mission.
Management Comments Please refer to IGCP (07) 291 dated 14 Aug 07 with regards to the over expenditure stated.

Vaccines were ordered in accordance with the requirements and in anticipation of the mobilization of additional troops for ‘Operation Sasamaki’.

Because of the lead time required for the delivery of items the orders had to be placed early while we look for proper storage spaces in QEB.
The upgrading of the vaccine storage facility continues to be a priority in the RFMF work schedules up till now.

16.18 Storage of Vaccine Vaccines are delicate chemical substance that can become less effective or destroyed if they are: • • • frozen; allowed to get too hot; or exposed to direct sunlight or florescent light.

Maintaining vaccines at the appropriate temperature from the time they leave the manufacturer to the time of administration, i.e.
maintenance of the cold chain21 is a very important aspect of proper immunization delivery programs.

In 2007, the RFMF purchased various types of vaccines from Budget Pharmacy, which include Typhoid fever, Yellow fever and Mencevax vaccines.

The vaccines purchased in 2007 were not properly stored to ensure the effectiveness of the vaccine for immunization.

To store the vaccines, the Pharmacy uses a domestic refrigerator which is insufficient to store all the vaccine in stock.
Vaccines were stored on shelves in an air-conditioned room with a temperature of +18oC, which is outside the recommended safe temperature range of +2oC to + 8oC.
Refer to Table 16.18 for details: 21 The cold chain is the system of transporting and storing vaccines within the safe temperature range of +2oC to +8oC Fiji Military Forces Section 16: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 16.18: Drugs not properly stored Vaccine Typhoid Fever Yellow Fever Mencevax Total Quantity (Ampoule) 523 643 300 Cost ($) 26,907 31,244 15,456 $73,607 A number of pharmaceutical supplies at RFMF pharmacy had expired but is still stored by the Pharmacy.
Refer to Table 16.19 for details.

Table 16.19: Expired drugs Vaccine Quantity Mencevax Injection (Meningococcal) Actrapid Injection (Neutral Insulin) Mixtard Injection (Biphasic Isophane Insulin) Protaphane Injection (Isophane Insulin) Stamaril Vaccine (Yellow Fever, stabilized) Aspirin Tablets 300mg Total Cost 50 ampoule 30 vials 10 vials 20 vials 13 ampoule 4 x 1000 tablets Cost ($) 2,576 510 173 249 632 80 4,220 The lack of proper storage may result in the ineffectiveness of the vaccines.
Recommendations • A larger refrigerator dedicated only to vaccine storage should be identified and used only for this purpose.

• Vaccines exposed to temperatures outside those in the manufacturers’ labels should be stored in a separate, marked container in a well-functioning monitored refrigerator until clear instructions have been received on what to do with them.

• Expired or deteriorated drugs should be regularly identified for safe disposal.
Management Comments RFMF acknowledges the shortfalls highlighted above and will continue to push for the installation of proper infrastructures for storage and upgrade existing ones to meet pharmaceutical standards within the budgetary allocations provided.

16.19 Recording of Pharmaceutical Stores All pharmaceutical supplies should be properly recorded and accounted for.

The pharmacy did not maintain proper records of all pharmaceutical supplies.
The manual stock cards were maintained only for vaccines.22 The other controlled or non controlled pharmaceutical supplies were not recorded.
22 Oral Polio Vaccine, Yellow Fever Vaccine, Hepatitis A Vaccine, Typhoid Fever Vaccine, Tetanus Toxoid Vaccine, Meningococcal P Vaccine And Hepatitis B Vaccine Fiji Military Forces Section 16: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Also, the Pharmacy did not have inventory management system to assist the pharmacy services in recording available supplies, quantity dispensed to the patient and determining the reorder points and minimum inventory stock levels.
In absence of proper stock record, the Pharmacy may not be able to ensure drug accountability, establish reorder points and minimum inventory stock levels or conduct annual stock take of pharmaceutical inventories.

Recommendation Systematic and organized process of ordering and recording pharmaceutical supplies should be developed to maintain sufficient stock for use.

Management Comments Comments raised herein are noted with thanks and very welcomed.
RFMF acknowledges that there is more work required in this area and given the generally infant status of the RFMF Pharmacy, this is an area that we are still developing and our continuous posting of military personnel to attend courses in the pharmaceutical discipline locally is a step in this direction.
16.20 Business Plan - Plant Pool All agencies that operate a Trading and Manufacturing activity must prepare a business plan for the activity each year.23 According to the Finance Instructions, the Business Plan should include the following: • • • • • analysis of the market the Plant Pool will operate in; profit target for the year and the next two years; strategies for achieving the profit target; risks relating to the activity; and projected profit and loss statements for the year.
There was no Business Plan prepared for the Plant Pool in 2007, detailing the activities for the operating year.

The absence of a proper plan outlining and evaluating the economic viability of the Plant Pool has resulted in the continuous operation on a loss.

Recommendation A Business Plan should be prepared as required by Finance Instructions 36.
Management Comments We acknowledge that there were no business plan done for 2006 and 2007, however, a draft format had been provided to the unit concerned to formulate a one for 2008 and onwards.
23 Finance Instructions 2005 36(1) Fiji Military Forces Section 16: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 16.21 Preparation of Financial Statements – Plant pool Each Agency operating a trading and manufacturing activity must prepare a quarterly profit and loss statement and a balance sheet on an annual basis.

The profit and loss statement and the balance sheet must be prepared on an accrual accounting basis.
The profit and loss statement should include all expenses that relate to the activity, and where necessary, include estimate of: a) b) c) d) e) overheads made by the departments; depreciation of assets; services provided below cost by other agencies; provisions of doubtful debts; provisions for inventory to be written of.24 The annual profit and loss statement and balance sheet for 2006 and any subsequent year must be prepared and submitted to the Auditor General in a form suitable for audit and inclusion in the agency’s annual report.
The Plant Pool has prepared Profit and Loss accounts for the first three quarters of 2007 however it did not include overheads, depreciation and provision for doubtful debts.

Therefore, the surplus or deficit reported in the Profit and Loss accounts may be incorrect.

The RFMF has also yet to formally submit the financial statements for its Trading Manufacturing Accounts to the Office of the Auditor General for audit.
Recommendation The RFMF must ensure that the Trading and Manufacturing Account is prepared in accordance with Finance Instructions 37 and submitted to the Office of the Auditor General for audit.

Management Comments Recommendations have been noted.

RFMF will ensure that the TMA are prepared and submitted on a timely basis from now on.

16.22 Discrepancies in the Records – Plant Pool and Accounts Section Proper records of the Trading and Manufacturing Accounts should be maintained.
The TMA records maintained at RFMF accounts section should always tally with records at Plant Pool.

The financial records maintained by the Plant Pool and the RFMF Accounts Section did not reconcile with significant variance noted between the two records.

The records maintained by the Plant Pool indicate that it has been making profits for first 3 quarters of its operation in 2007.

However, this did not match with the records maintained at the Accounts Section.
Refer to Table 16.20 for details: 24 Finance Instruction 2005 37(2) Fiji Military Forces Section 16: Page 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Table 16.20: Discrepancies in Plant Pool and Accounts Section records Profits Period Plant Pool ($) First Second Third 2,596 21,103 14,235 Accounts Section ($) (687) (40,406) 74,327 Variance ($) 3,283 61,406 (60,092) The financial statements prepared by the Accounts Section were drawn from the records produced by the Ministry of Finance through the FMIS while the Plant Pool was preparing the quarterly accounts from the records it maintains.
The above clearly indicate the absence of any reconciliation carried out by the Accounts Section and the lack of appropriate supervisory checks.

Recommendations • RFMF must ensure that two records are reconciled and differences identified are adjusted accordingly.

• Proper records should be maintained by both the Plant Pool and the Accounts section and verified to the FMIS.
Management Comments We acknowledge your recommendations and confirm that the two records were not properly maintained and accounted for.

RFMF will ensure that both the records are reconciled and verified by FMIS report on a timely basis from now onwards.
16.23 Arrears of Revenue – Plant Pool Each agency must maintain a Debtors Register or an Accounts Receivable Ledger for State or agency revenues receivables.25 Accounts which are overdue must be promptly followed up in accordance with the debt recovery procedures in the RFMF Finance Manual.
Within one month after the end of each quarter, each agency with accounts receivable must submit a quarterly report on outstanding and overdue debts to the Ministry of Finance.26 The following were noted from the audit of arrears of revenue.

• • • As at 31/12/07, the total arrears of revenue for the Plant Pool amounted to $176,839,27 an increase of $19,384 or 12% from 2006.

Refer to Appendix 16.2 for arrears of revenue.


There has been very little effort to recover revenue which has been in arrears before 2007.

The quarterly reports on outstanding and overdue debts were also not prepared and submitted to the Ministry of Finance.

The aging of arrears has not been carried out to determine those that have been long outstanding and may require to be written off.
25 2005 Finance Instructions – Section 47 26 2005 Finance Instructions – Section 48 & 50 27 Refer to Appendix 1 of this Report Fiji Military Forces Section 16: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • A number of debtors are still being provided services by the RFMF Plant Pool even though their accounts are in arrears with some outstanding since 2003.

Refer to Appendix 16.3 for examples of long outstanding debts.
The above anomalies indicate poor or ineffective debt recovery procedures adopted by the Plant Pool.

The untimely collection of revenue may result in possible write offs, which could affect the profitability of the Plant Pool.

Recommendations • Debt collection should be improved and regular follow-ups should be carried out to ensure that money owed to the Plant Pool is recovered.

• Quarterly reports on outstanding and overdue debts must be prepared and submitted to the Ministry of Finance.
• The RFMF should consider discontinuing the provision of services to organizations which have debts from previous years.

Management Comments The RFMF will make every effort to recover all revenue that has been overdue and a report to be submitted in accordance with the rules and regulations.
16.24 Unaccounted Fuel An employee must use Government resources and assets in a proper way.28 Dip stick reading for fuel and oil stock is taken and recorded in the Stock Issue Sheet before the fuel tank is refilled and after refilling.

The Stock Issue Sheet is updated when the stock is used and the closing balance on the Stock Issue Sheet is used to determine the stock on hand at any point in time.
Fuel reading conducted at the Engineers Plant Pool on 28/11/07 indicated 1,000 litres of fuel stored in the tank.

However, the fuel Issue Sheet had a balance of 1,284 litres.

The officer responsible was not able to provide any explanations for the unaccounted 284 litres.

The issue of unaccounted fuel was also raised in the 2006 Audit Memorandum.

Failure to maintain proper records of the utilization of fuel may lead to theft and misuse of fuel.

The Stock Issue Sheets were also not properly maintained.
The following discrepancies were noted.

• In one of the stock sheets, the total diesel issued was more than the opening balance recorded in the issue sheet.

• More than one stock issue sheets were used to record the issue of diesel on the same day.

• Drivers who were issued fuel did not sign the stock issue sheets to evidence that fuel were issued to them.

• The closing balance was not always properly stated in the stock issue sheets.
In most cases, the closing balances were estimated in drums rather than calculating the actual balance in litres.

The risk of misuse of fuel and oil is high if records are not properly maintained and checked by supervisors.

28 Public Service Code of Conduct section 8 Fiji Military Forces Section 16: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • Fuel Registers and Stock Issue Sheets must be maintained and updated as and when the fuels are used.
• Supervisory checks on the fuel records should be improved.

• Since there were no satisfactory explanations for the fuel shortage provided during the audit, an investigation should be carried out to determine whether the fuel was utilised for official purposes.

Management Comments RFMF acknowledges that there is a lot to be done in terms of supervision and period checks and will endeavor to improve on these from now onwards.
16.25 Private Funds – Fines Account The Fines Account maintains fines paid by the RFMF servicemen as imposed by internal Courts of the RFMF.

The main expenditure is loans to Senior Officers from the rank of Captain and above.

The following anomalies were noted: • • proper set of accounts have not been prepared for the Fines Account; and monthly bank reconciliations were not carried out during the year.
Bank reconciliation is the process of matching and comparing records maintained for the account against those presented on the bank statement.

It would allow those maintaining the Fines Account to uncover any possible discrepancies.

The absence of reconciliations and proper set of accounts increases the risk of fraud and mismanagement of funds.

Recommendations • Bank reconciliations should be prepared on a monthly basis.

• A proper set of annual accounts should be prepared and submitted for audit.
Management Comments RFMF acknowledges that the Fines Account records were not updated.

The matter has been addressed with a clerk who now looks after the upkeep and maintenance of the Fines account on a fulltime basis.
Fiji Military Forces Section 16: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 16.1 – Statement of Output Costs Policy and Administration Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 7,060,446 0 328,863 225,425 77,112 0 75,103 7,766,949 0 80,749 0 80,749 5,840,192 478 274,729 354,804 72,598 0 703,720 7,246,521 9,637 127,043 0 136,680 Value Added Tax 858,192 2,121,316 TOTAL EXPENDITURES 8,705,890 9,504,517 Logistic Support Unit Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs 2007 $ 2006 $ 5,742,305 0 0 1,102,360 27,617,056 0 0 34,461,721 6,654,293 0 0 638,795 8,443,397 0 0 15,736,485 Value Added Tax 2,379,371 1,620,569 TOTAL EXPENDITURES 36,841,092 17,357,054 Fiji Military Forces Section 16: Page 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 3 FIR 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 11,621,031 0 6,616 0 211,438 0 0 11,839,085 15,411,725 0 22,609 0 173,571 0 0 15,606,905 0 24,746 0 24,746 0 34,687 0 34,687 Value Added Tax 252,770 1,367,040 TOTAL EXPENDITURES 12,116,601 17,008,632 FMF Engineers Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services
 Operating grants & transfers Special expenditures Total Operating Costs 2007 $ 2006 $ 7,053,756 0 16,293 386,300 127,365 0 0 7,583,714 8,105,708 0 10,739 372,457 70,690 0 0 8,559,594 Value Added Tax 705,448 668,810 TOTAL EXPENDITURES 8,289,162 9,228,404 Fiji Military Forces Section 16: Page 27 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 FMF Naval Division Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 4,955,237 0 185,243 1,197,905 599,815 0 0 6,938,200 0 4,796 0 4,796 5,696,503 0 79,360 1,206,801 351,881 0 0 7,334,545 0 14,222 0 14,222 Value Added Tax 814,575 687,941 TOTAL EXPENDITURES 7,757,571 8,036,708 Territorial Forces 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 11,689,463 0 9,434 10,276 700,796 0 38,674 12,448,643 550,154 0 12,204 (16,512) 71,919 0 2,256,357 2,874,122 0 0 0 0 0 0 0 0 Value Added Tax 800,705 187,457 TOTAL EXPENDITURES 13,249,348 3,061,579 Fiji Military Forces Section 16: Page 28 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Iraq Mission 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs 2007 $ 2006 $ 14,241,838 0 0 0 0 0 0 14,241,838 9,743,707 0 0 0 1,198 0 36,188 9,781,093 Value Added Tax 627,976 694,098
 TOTAL EXPENDITURES 14,869,814 10,475,191 Peace Keeping Force - Sinai Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs 2007 $ 2006 $ 14,139,829 0 38,797 32,289 392,699 0 0 14,603,614 11,037,802 0 56,428 1,970 474,935 0 0 11,571,135 Value Added Tax 770,109 785,519 TOTAL EXPENDITURES 15,373,723 12,356,654 Fiji Military Forces Section 16: Page 29 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Force Training Group Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs 2007 $ 2006 $ 1,882,319 0 140,008 131,380 70,087 0 0 2,223,794 3,461,945 0 60,318 114,303 84,714 0 0 3,721,280 Value Added Tax 176,692 334,671 TOTAL EXPENDITURES 2,400,486 4,055,951 Land Force Command 2007 Description EXPENDITURES Operating Established staff Unestablished staff Travel & communication Maintenance & Operations Purchase of goods & services Operating grants & transfers Special expenditures Total Operating Costs 2007 $ 2006 $ 4,237,454 252,666 908,901 658,351 147,378 0 0 6,204,750 6,941,164 290,820 486,377 569,186 176,156 0 12,675 8,476,378 Value Added Tax 476,687 1,281,702 TOTAL EXPENDITURES 6,681,437 9,758,080 Fiji Military Forces Section 16: Page 30 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 16.2: Arrears of Revenue – Plant Pool Date Job Number Description Organisation 02/07/07 EP39/07 Hire of plant equipments to level Engineers parade ground Training Vote Amount ($) 2,109.00 19/06/07 EP33/07 EP38/07 Hire of plant equipments for ripping stock piling & loading of s/stone.
BW Holdings 2,203.00 558.00 27/03/07 EP22/07 Hire of plant equipments to uplift D6 from Lami.
Ministry of Youth and Sports 250.00 01/03/07 14/02/07 26/04/06 25/05/06 06/06/06 20/06/06 10/07/06 16/08/06 21/08/06 30/03/05 EP18/07 EP13/07 EP15/07 EP 29/06 EP 30/06 EP 31/06 EP 32/06 EP 33/06 EP 34/06 EP 35/06 EP 36/06 EP 61/05 EP 93/06 EP 95/06 EP 132/06 EP 133/06 EP 144/06 EP 152/06 EP 153/06 EP 154/06 EP 155/06 EP 156/06 EP 12/05 23/05/05 EP 81/05 26/05/05 26/05/05 09/06/05 09/06/05 16/06/05 02/08/05 EP 46/05 EP 47/05 EP 60/05 EP 61/05 EP 67/05 EP 98/05 Hire of plant equipments to upgrade road.
Hire of plant equipments to assist water supply cart water.

FTG Nasinu PWD Water Supply Hire of plant equipments for the work carried out at Nasinu Form Seven College PWD Building Section Hire of plant equipment to load sand and gravel.

Hire of vehicle to cart soapstone from 4 miles to Lokia.

RC Manubhai PWD Roads Hire of plant vehicle to cart material to Ovalau.

Hire of plant equipment by George Chung.

Cartage of Pine post from RA to Rewa.


Provincial Ovalau Council George Ghung Koroi Hire of RFMF plant vehicle to cart soft stones from Nabuni to Lami.

Hire of RFMF vehicle to assist PWD carting building materials to various sites.

Tabutabu PWD Building Repair of base set and wireless.

Hire of plant equipment for the excavation work Hire of RFMF plant vehicle to cart material.

Hire of RFMF plant vehicle to assist fisheries Department.

Hire of RFMF plant machines.


Cart v-drains from Humes to PWD work site.

Elcom Services Ratu Sukuna School Training Vote Fisheries Department Downer Ltd PWD Building PWD Building 02/08/05 EP 99/05 Hire of RFMF vehicle to assist PWD carting of culvert from Humes.
Fiji Military Forces Section 16: Page 31 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Date Job Number Description Organisation 08/09/05 EP 122/05 08/09/05 EP 123/05 21/1105 10/03/04 18/03/04 02/04/04 13/07/04 07/09/04 29/09/04 29/09/04 12/10/04 12/10/04 19/10/04 19/10/04 05/11/04 06/12/04 29/01/03 03/02/03 03/02/03 28/05/03 EP 179/05 EP 21/04 EP 24/04 EP 35/04 EP 36/04 EP 102/04 EP 159/04 EP 200/04 EP 201/04 EP 207/04 EP 208/04 EP 216/04 EP 218/04 EP 244/04 EP 273/04 EP 05/03 EP 06/03 EP 07/03 EP 69/03 30/05/03 EP 74/03 16/06/03 21/07/03 18/07/03 EP 86/03 EP 104/03 EP 105/03 07/10/03 EP 189/03 20/10/03 27/10/03 28/10/03 28/10/03 28/10/03 29/10/03 29/10/03 EP 197/03 EP 202/03 EP 203/03 EP 204/03 EP 209/03 EP 215/03 EP 219/03 for Road and Hire of plant equipment upgrading of ground.
Hire of RFMF plant to cart material for 30th Anniversary Celebration.

Excavation of waist material Hire of plant vehicle for carting material.

Hire of RFMF plant vehicle to cart material.

Work carried at Reservoir.

Hire plant to hire cart machines from Krovou Depot Grading and Shaping of roads.

Hire of RFMF plant to cart 2 loads of gravel.

Hire of equipments to level the Hometown Motors site.

Hire of plant vehicle for cartage.

Hire of RFMF vehicle to cart scrap metals.

Hire of plant machines.


Hire of plant vehicle to cart scrap metals.

Hire of dump truck to cart materials.

Hire of equipments to cart materials and level sites.

Hire of RFMF plant vehicle DISMAC carting relief materials to Labasa.

to assist Hire of RFMF plant to cart soil from Stadium to New Gym.

Hire of plant vehicle to cart gravels from Nasinu Quarry.

Hire of RFMF plant equipment to cart D6.

Hire of plant vehicle to cart a digger.

Hire of plant vehicle to cart container from wharf to Lami.
Hire of dump trucks to cart water for PWD water supply.

Hire of plant vehicle to cart material.

Hire of plant vehicle to transport house materials from Govt House to Colo-i-suva.

Hire of plant vehicle.

Hire of plant vehicle.

Hire of plant vehicle to construct the FEA excess road Hire of plant to level and complete the site.

Hire of Dump Truck to cart gravel.


RFMF PWD Building HQ LFC PWD Building PWD DNS Contractors Mahen Singh Telecom Fiji Horeb Engineering Sila Enterprise Horeb Engineers PWD Buildings Works and Energy DISMAC Jet Patcher Mr. Rabo Jet Patcher PWD PWD Water Supply PWD Building Section.

PWD Construction Telesource International PWD Construction 31/10/03 EP 223/03 Hire of dump truck to cart water.
PWD Building 31/10/03 31/10/03 03/11/03 03/11/03 05/11/03 05/11/03 05/11/03 EP 224/03 EP 225/03 EP 228/03 EP 229/03 EP 239/03 EP 240/03 EP 241/03 Fiji Military Forces Hire of plant vehicle to cart materials.

To cart blocks To cart water To cart materials.

PWD Construction.

Hire of plant vehicle to cart gravel for PWD Building.
PWD Building Amount ($) Section 16: Page 32 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Date Job Number Description Organisation EP 245/03 EP 247/03 EP 248/03 EP 254/03 EP 297/03 EP 306/03 EP 308/03 07/11/03 10/11/03 10/11/03 12/11/03 10/12/03 16/12/03 18/12/03 Total To cart blocks.
To cart materials.

PWD Construction PWD Building To level sites at Kinoya power plant.
To transport, excavate level and cart soil to offsite Telesource Amount ($) 104.40 178.35 309.68 427.50 332.19 1,675.08 1,750.00 $176,838.52 Appendix 16.3: Outstanding Debts – plant pool DATE JOB NUMBER ORGANIZATION 10/03/04 02/04/04 02/04/04 05/11/04 20/10/03 31/10/03 27/10/03 28/10/03 28/10/03 29/10/03 31/10/03 31/10/03 31/10/03 03/11/03 03/11/03 05/11/03 05/11/03 05/11/03 07/11/03 10/11/03 10/11/03 12/11/03 10/12/03 28/10/03 29/10/03 16/12/03 18/12/03 TOTAL EP 21/04 EP 35/04 EP 36/04 EP 244/04 EP 197/03 EP223/03 EP 202/03 EP 203/03 EP 204/03 EP219/03 EP223/03 EP 224/03 EP 225/03 EP 228/03 EP 229/03 EP 239/03 EP 240/03 EP 241/03 EP 245/03 EP 247/03 EP 248/03 EP 254/03 EP297/03 EP 209/03 EP 215/03 EP 306/03 EP 308/03 PWD Building PWD Building PWD Buildings PWD Building PWD Building PWD Building PWD Construction PWD Building PWD Construction PWD Building PWD Building PWD Construction PWD Building Telesource International Telesource International AMOUNT ($) 222.56 727.13 965.63 486.00 517.00 219.50 456.37 438.15 320.00 267.00 219.50 339.22 307.05 254.25 238.50 679.00 375.00 647.00 104.40 178.35 309.68 427.50 332.19 320.00 1,065.00 1,675.08 1,750.00 13,841.06 Fiji Military Forces Section 16: Page 33 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 17 Fiji Police Force Programme Statement In accordance with the statutory obligations and the community expectations, the Fiji Police Force is to be employed in and throughout Fiji for the maintenance of law and order, the preservation of peace, the protection of life and property and the detection of crime and the enforcement of all laws and regulations with which it is directly charged.
The Fiji Police Force is divided into six branches and these are the Special Branch, Criminal Investigation, Traffic & Transport, Training, General Uniform and Office of the Commissioner and Headquarters which manage and perform functions relative to the nature.
Table of Contents 17.1 17.2 17.3 17.4 17.5 FINANCIAL STATEMENT ..................................................................................................................... 2 Audit Opinion ............................................................................................................... 2 Statement of Receipts and Expenditures ..................................................................... 2 Statement of Output Costs........................................................................................... 3 Appropriation Statement .............................................................................................. 3 Statement of Losses .................................................................................................... 3 AUDIT FINDINGS ................................................................................................................................. 4 17.6 Agency Financial Statements....................................................................................... 4 17.7 Revenue ...................................................................................................................... 5 17.8 Operating Trust Fund Account ..................................................................................... 6 17.9 Revolving Fund Account - Miscellaneous .................................................................... 7 Drawings Account.................................................................................................... 8 17.10 Imprest Account and IDC Account........................................................................... 9 17.11 FNPF Reconciliation................................................................................................ 9 17.12 Overpayment of Salaries - Resignation ................................................................. 10 17.13 Occupation of Quarters.......................................................................................... 11 17.14 Receiving Allowances
 while on Overseas Leave ................................................... 14 17.15 Follow Up – Overpayment of Salaries from 2004 to 2006...................................... 15 17.16 Arrears of Revenue ............................................................................................... 22 17.17 Audit Limitation – Removal of Records by FICAC.................................................. 22 17.18 Purchases from Lotus Garment Ltd ....................................................................... 24 17.19 Missing Payment Vouchers ................................................................................... 25 17.20 Civil Litigation ........................................................................................................ 26 17.21 Maintenance of Cheques....................................................................................... 26 17.22 Court Exhibits ........................................................................................................ 27 17.23 17.24 Delays in Recovering Surcharges.......................................................................... 33 Appendix 17.1 – Statement of Output Costs for 2007............................................................. 35 Fiji Police Force Section 17: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 FINANCIAL STATEMENT 17.1 Audit Opinion The audit of the 2007 accounts of the Fiji Police Force resulted in the issue of a qualified audit report.
The qualifications are as follows.

• Audit could not verify and substantiate the non-payroll expenditures totalling $3,674,191 incurred by the Force for the period 1/01/07 to 31/05/07 as the payment vouchers and supporting documents were not provided for audit.

• The amounts reflected in the Statements of Output Costs have been estimated as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.
It is not possible therefore to determine the accuracy of the expenditures incurred by the Force under each output.

• The Fiji Police Force has not provided a Trust Fund Account Statement of Receipts and Payments contrary to Finance Instructions 82(1).

The Financial Management Information System shows that the Force as at 31/12/07 has operating trust funds totalling $1,693,937.
17.2 Statement of Receipts and Expenditures The Department incurred total expenditures of $73,589,794 in 2007 compared to $74,620,185 in 2006.
Table 17.1: Statements of Receipts and Expenditures for 2007 Description RECEIPTS Police Clearance Fees Licenses Fees Other State Revenue Other Agency Revenue 2007 $ 2006 $ 576,047 34,484 76,389 18,849 401,036 18,328 55,632 9,580 TOTAL REVENUE 705,769 484,576 EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Expenditure Construction Purchases Fiji Police Force 57,333,697 903,893 3,660,283 3,657,981 1,800,405 19,957 504,383 67,880,599 51,837,713 883,691 4,335,681 3,829,988 2,729,036 25,860 1,435,346 65,077,315 188,437 119,802 627,912 613,081 Section 17: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description Total Capital Expenditure 2007 $ 308,239 2006 $ 1,240,993 Value Added Tax 5,400,956 8,301,877 TOTAL EXPENDITURE 73,589,794 74,620,185 17.3 Statement of Output Costs The Statement of Output Costs consolidates the 7 outputs prescribed in the Budget Estimates, contrary to the requirements of the Finance Instructions.
These are detailed in Appendix 17.1 17.4 Appropriation Statement The Department incurred expenditures totalling $73,589,794 in 2007 against the budget of $69,946,471 resulting in an over-expenditure of $3,643,323 or 5%.

Details of expenditures against the budget estimates are provided in Table 17.2.
Table 17.2: Appropriation Statement for 2007 Actual Expenditure $ Carry – Over $ Lapsed Appropriation $ SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Budget Estimate $ 50,366,082 894,990 3,630,056 4,016,300 1,836,443 20,000 538,000 61,301,871 Changes $ 0 0 78,712 80,000 (128,712) 0 (30,000) 0 Revised Estimate $ 50,366,082 894,990 3,708,768 4,096,300 1,707,731 20,000 508,000 61,301,871 57,333,697 903,893 3,660,283 3,657,981 1,800,405 19,957 504,383 67,880,599 550,000 325,000 - 875,000 0 0 - 0 0 0 550,000 325,000 - 875,000 188,437 119,802 - 308,239 7,769,600 5,400,956 69,946,471 73,589,794 13 Value Added Tax 7,769,600 TOTAL EXPENDITURE 69,946,471 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (6,967,615) (8,903) 48,485 438,319 (92,674) 43 3,617 (6,578,728) 361,563 205,198 - 566,761 2,368,644 (3,643,323) The Ministry of Finance approved the transfer of funds totalling $158,712 during the year.
17.5 Statement of Losses The Department did not report any loss of inventories, fixed assets or money during the year.
Fiji Police Force Section 17: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 AUDIT FINDINGS 17.6 Agency Financial Statements Commencing 2006 financial year, each annual report must include financial statements which are prepared and signed in accordance with the Finance Instructions, audited by the Auditor General, and accompanied by an audit opinion prepared by the Auditor General.1 The draft financial statements must be submitted to the Auditor – General by 31 March in the following year, or within such other time as agreed to with the Auditor – General.2 Fiji Police Force submitted its Agency Financial Statements for audit on 6/08/08 and were not prepared in accordance with Finance Instructions.
Audit could not substantiate the balances reflected in the Statements of Output Costs as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS) of government.

The Acting Senior Accounts Officer revealed that the balances reported were derived using a template designed by the Ministry of Finance.
The Department vired funds totalling $158,712 from and to the following SEGs: Table 17.3: Details of Virements Vired From Vired To SEG 5 – Purchase of Goods & Services SEG 5 – Purchase of Goods & Services SEG 7 – Special Expenditure SEG 3 – Travel & Communication SEG 4 – Maintenance & Operations SEG 4 – Maintenance & Operation Amount ($) 78,712 50,000 30,000 The virements were unnecessary as the budget estimates were sufficient.
It also resulted in an over – expenditure in SEG 5 Purchases of Goods & Services totalling $92,674.

Recommendations • The Department should ensure that Finance Instructions 82 is strictly followed in the preparation of the Financial Statements.

• Virement of funds from one SEG to another should only be made when there is a shortfall which could not be catered from the approved budget for that particular SEG.
Management Comments The lateness in the submission of the 2007 Fiji Police Force Agency Financial Report was due to the new format provided in the FMIS; the Auditor General emphasized during the meeting at Fiji Police Force HQ, Manohan Building that the Office of the Auditor General will accept the late submission this year as it is the first time to implement such report but not in the financial year 2009 for the submission of Agency Report for 2008.
The preparation of the final Virement Warrant for the financial year 2007 was prepared and submitted to the Ministry of Finance in January 2008 as highlighted in the Finance Circular, whilst the closing of Accounts for the financial year 2007 was in April 2008; this is the reason why the virement amount in question does not equal to the final expenditure amount.
1 Finance Instructions 2005 – 81 (2) 2 Finance Instructions 2005 – 81 (3) Fiji Police Force Section 17: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.7 Revenue Within five working days of the Ministry of Finance issuing the monthly General Ledger Reports, the Assistant Accounts Officer Ledgers shall reconcile the revenue figures in the report to the Revenue Statement.
Where errors or discrepancies occur, the Force Accountant shall inform the Chief Accountant in writing within seven days of receiving the general ledger reports.3 The revenue collected for the year as recorded in the Revenue Register maintained by the Department, did not reconcile with the general ledger (FMIS).
Refer to Table 17.4 for details: Table 17.4: Unreconciled Revenue Revenue Type Police Clearance 230399 VAT 220199 Arms 230401 General Revenue 279999 Hotel License 230410 Money Lenders 230409 Liquor License 230405 Export & Import 230406 270301 TOTAL General Ledger - FMIS ($) 576,046.74 76,389.02 25,794.11 17,349.88 2,550.00 1,880.00 4,220.00 40.00 1498.87 705,768.62 Department Register ($) Variance ($) 591,071.52 23,985.75 29,900.57 16,087.36 2,756.25 2,115.00 4,680.00 22.50 - 670,618.95 (15,024.78) 52,403.27 4,106.46 1,262.52 (206.25) (235.00) (460.00) 17.50 1498.87 35,149.67 The Department failed to provide explanation on the variances noted from the Department’s records against balances provided in the general ledger (FMIS).
Proper monthly reconciliations were not prepared during the year to account for the total revenue collected in a month.

Recommendations • Reconciliations must be prepared on timely basis and any errors detected must be adjusted immediately.

• Supervisory checks on the reconciliations should be improved to ensure the accuracy of the balances in the reconciliation and the records maintained by the Department.
• Officers failing to carry out their responsibilities, in ensuring that records are updated and accurate reconciliations are prepared on time, should be disciplined accordingly.
Management Comments The total revenue collected and deposited into the bank, are the funds that reflected in the General Ledger – FMIS, that is, $705,768.62; the amount reflected in the Fiji Police Force Register are manual amounts that was subject to error due to the non reconciliation made by the Assistant Accounts Officer – Ledgers (AAO-L).

The AAO-L was instructed to ensure that reconciliations are to be conducted on monthly basis to detect the anomalies and adjusted accordingly.
3 Fiji Police Force – Finance Manual 2005 – 5.5.12 & 5.5.14 Fiji Police Force Section 17: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.8 Operating Trust Fund Account Within five days after the end of each month, the Assistant Accounts Officer Ledgers shall prepare a trust reconciliation to reconcile trust account balances to the ledger total and the trust bank account.4 The Operating Trust Fund Account for the year did not reconcile with general ledger (FMIS).
Refer to the Table below for detail: General Ledger - FMIS Department Variance $ 1,693,937.44 202,653.63 1,491,283.81 The closing balance of the reconciliations for October also did not agree with the opening balance of the reconciliation for November 2007.
Refer to the Table below for details: October Closing Balance November Opening Balance Variance $ 3,115,428.23 2,789,235.12 326,193.11 The above finding indicates ineffective controls and lack of supervisory checks in the administration of the operating trust fund account.

It also illustrates non–compliance with the regulations governing the maintenance of the trust monies.
Recommendations • Supervisory checks on the reconciliation should be improved to ensure the accuracy of the balances reported in the reconciliation.

• The Department should carry out a thorough review of the operating trust fund accounts for which balances have been carried forward from previous years.

• The Department should ensure compliance with its Finance Manual at all times.
Management Comments The Department figures were verified against the balance in the General Ledger-FMIS under the new Operating Trust Fund Allocation 860000 and 890000 provided in the FMIS which Department amount of $202,653.63 derives from.

It was a reconciliation error made by the Accounts and the error has been identified and adjusted to rectify the error.
The Miscellaneous Fund in question is the fund for the Police Reward Fines and Forfeitures; the amount highlighted by your office, the AAO-(L) already being instructed to verify the figures in question and adjust accordingly through reconciliations.
4 Finance Manual – Fiji Police Force 2005 – Section 15.4.1 Fiji Police Force Section 17: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.9 Revolving Fund Account - Miscellaneous Accountable Advance is granted for officers for official visits to cover costs of accommodation meals and incidental expenses which shall be cleared by the officer within 7 days of his/her return.5 The Revolving Fund Account – Miscellaneous for the year did not reconcile with to the closing balance of the general ledger (FMIS).
Refer to the Table below for details: General Ledger - FMIS Department Variance $ 452,421.18 380,311.81 72,109.37 Verification of the records indicates that the 2006 closing balance did not reconcile with the January 2007 opening balance.

Refer to the table below for details: 2006 Closing Balance January 2007 Opening Balance Variance $ 388,350 389,243 893 It was further noted that an addition error in the reconciliation for April had resulted in the overstatement of the closing balance by $2,789.69.
The error had also affected the correctness of the subsequent months’ reconciliations.

The issue of non–clearance of accountable advances has been constantly raised by audit over the years.

Some accountable advances have been outstanding since 1993 and indicates laxity by relevant officers.

Recommendations • The Department should investigate the variances noted and make the necessary adjustments to correct the reconciliations.
• The Supervisory checks on the reconciliation should be improved to ensure the accuracy of the balances reported in the reconciliation.

• Accountable advances should not be issued to officers who have yet to clear/retire previous advances.

The issue of non–clearance of accountable advance will continue to be raised unless the Department implements stringent measures to improve compliance with regulations pertaining to accountable advances.
Management Comments The identified irregularities were mainly due to the transfer of accounts numbers and their respective figures from the manual system to the FMIS from December 2006 to January 2007; the AAO-(L) was directed to rectify the anomaly on such transfer of figures from manual to the FMIS through the adjustment on the reconciliation statement.
5 Finance Circular 18/11/97 – 201/1-2 Fiji Police Force Section 17: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.10 Drawings Account When cheques have become stale, payment of the outstanding cheques shall be stopped and the Department should issue a replacement cheque if the payee is located, otherwise, the department should make the necessary adjustments.6 The Drawings Account shall be operated from the Head Office of the Department or as approved by the Chief Accountant.7 The Assistant Accounts officer (Ledgers) shall prepare bank reconciliation within 5 days of the end of month.8 The examination of the Drawings Account Reconciliation revealed that unpresented cheques as at 31/12/07 amounted to $2,652,661 of which $500,094 were stale cheques.
The closing balance of the Drawings account for December did not reconcile with Appendix 3.

Refer to the Table below for detail: Appendix 3 Department Variance ($) 5,414,993 2,652,661 2,762,332 Further verification of the Drawings account revealed that the closing balance of the reconciliation for December 2006 did not correspond to the opening balance of the reconciliation for January 2007.
Refer to the following Table for details: 2006 Closing Balance as per Appendix 3 Department’s Opening balance for 2007 Variance ($) 2,050,858.00 2,588,874.77 538,016.77 The above imply inadequate supervisory checks on reconciliations prepared on a monthly basis.

Recommendations • Reconciliation must be prepared on a timely basis and any errors detected are adjusted immediately.

• Supervisory checks on the reconciliations should be improved to ensure the accuracy of the balances in the reconciliation.
Management Comments The Stale Cheques highlighted has been adjusted and journalized accordingly in the month of October, 2008.

The Variance of $2,762,332.00, the accounts are working on to identify and rectify through the adjustments which will be highlighted in the reconciliations.

In the Department January 2007 Opening Balance according to the Fiji Police Force reconciliation it has a monetary value of $2,050,858.12 which equals to the 2006 Closing Balance.
6 Finance Instruction 102 7 Finance Instruction 88(3) 8 Finance Manual-Fiji Police Force - Section 7.4.7 Fiji Police Force Section 17: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.11 Imprest Account and IDC Account Within five days after the issue of the monthly General Ledger report by the Ministry of Finance, the Assistant Accounts Officer Ledgers shall prepare a petty cash reconciliation to reconcile the petty cashbook balance to the General Ledger Balance.
The Reconciliation must be forwarded to the Ministry of Finance by the date set by the Ministry.9 All Imprest Holders must retire their petty cash before the end of the financial year i.e.

by the first week of December.


Petty cash shall be retired by submitting the cashbook, petty cash vouchers and any cash on hand balance to the Force Accountant for journalising.10 A ledger shall be maintained for advances, petty cash, accounts payable, revolving fund accounts, inter-departmental clearance accounts, cash clearance accounts, expenditure and commitment accounts.
Within 3 days of receiving the monthly ledger reports from the Ministry of Finance, the Assistant Accounts Officer Ledgers shall reconcile the ledger balances to the general reports and prepare a ledger reconciliation statement.11 The Department failed to prepare regular monthly reconciliations for the Imprest and Inter Departmental Clearance accounts; hence audit could not substantiate the accuracy of the balances reported in Appendix 19 of the Accounts and Finance.
Recommendations Officers failing to carry out their responsibilities in ensuring that records are updated and accurate reconciliations prepared on time should be disciplined accordingly.

Management Comments In the financial year 2007 the Chief Accountant of the Ministry of Finance does not approve any Imprest Account for the Fiji Police Force to maintain.
The Inter Departmental Clearance Accounts (IDC) in the financial year 2007 was prepared on the monthly basis and submitted to the Ministry of Finance, copies are maintained at the Fiji Police for your office scrutiny.
17.12 FNPF Reconciliation Every employer shall pay to the Fund in respect of each of his employees, in every month during which such employee by him and in the month following the termination of such employment, a contribution calculated upon the amount of wages payable to such employee by such employer for the preceding month at the appropriate rates.12 A reconciliation of FNPF contributions against salaries and wages reported in the Financial Statements revealed variance as follows: Descriptions (a) Total FNPF against salaries and wages for 2007 $ $ FNPF as per financial statement 4,057,883 9 Finance Manual-Fiji Police Force - Section 7.3.25 10 Finance Manual-Fiji Police Force - Section 7.3.26 & 7.3.27 11 Finance Manual-Fiji Police Force – Section 16.3.1 & 16.3.3 12 Chapter 219 – Fiji National Provident Fund – Section 13 (1) Fiji Police Force Section 17: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Descriptions Add: FNPF for December 2007 Payment made not entered into FMIS for 2007 Less: FNPF for December 2006 Gross pay subject to FNPF (4,439,827 divided by 0.08) (b) Salaries and wages for 2007 subject to FNPF: Salaries, wages and allowances as per financial Statement Less: Salaries and wages not subject to FNPF Salaries, wages and allowance for 2007 subject to FNPF Variance $ 442,072 343,399 $ 785,471 4,843,354 403,527 4,439,827 55,497,838 54,165,436 - 54,165,436 1,332,402 The Department did not provide any explanations for the variance.
Recommendation The Department should review its FNPF records and reconciliations and provide explanation for the variance.

Management Comments The variance of $1,332,402 is the deduction made from the employees of the Fiji Police Force in the month of December 2007 and to be payable to the Fiji National Provident Fund in the month of January, 2008.

Further OAG Comments The Department did not provide any evidence to substantiate the management comments provided.
17.13 Overpayment of Salaries - Resignation Salary Change Advice shall be prepared by Departments where they affect personal emoluments and deductions such as resignation and retirement.13 Salary advices must be submitted promptly to the Ministry of Finance where there is any change to personal emoluments or deductions dismissal, resignations and retirement.14 The Department continued to pay salaries of officers after they have retired or resigned from the Force resulting in overpayment of salaries.
Refer to the following examples.

• SGT Jemesa Tuvuki retired from the Force with effect from 10/10/07.

The Officer was paid lodging allowance until 21/10/07 resulting in overpayment of $133.56.

Before retiring, the officer was paying $80 per fortnight for rent in arrears of which $428.19 was still owed by him.

He was overpaid a total of $561.75.


13 Finance Instructions 59 (4) 14 2005 Finance Instructions 26 (1) Fiji Police Force Section 17: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • SC 125 Meli Rakurea retired from the Force with effect from 15/06/07 but was continued to be paid salaries until 29/07/07 resulting in an overpayment of $639.63.
The salary, extra duty, CID and plain clothes allowance of Inspector Timoci Narova was continued to be paid to his bank account until 23/09/07 although the officer passed away on 07/09/07.

The above resulted in a salary overpayment of $1,126.90.

The overpayments of salaries resulted from the failure of the Force to submit salary change advice on time to the Ministry of Finance.
In addition, the lack of communication and proper coordination between the relevant Units within the Force is also a contributing factor to the overpayment of salaries.

Recommendations • Salary overpayments should be recovered from relevant officers.

And in cases where recovery is not possible, the Force should investigate the cause of the overpayment and surcharge the officers responsible for the overpayment.
• The payment of leave compensation and other payments on retiring or resigning, should be • withheld until the salary change advice is submitted to the Ministry of Finance.

It is also recommended that a list of officers that have retired or passed away from the Force should be provided to the Accounts Section by HRM and Administration Section on a fortnightly basis for verification purposes.
• The Force should address these shortcomings by communication and coordinate matters affecting payroll in a timely manner between the Administration and the Accounts Sections.
Management Comments Sgt 50371 Jemesa Tuvuki It was assumed that Lodging Allowance will be paid from the reduce number of days paid for that pay period [Pay 21/07 (08/10-22/10/070)] SC 125 Meli Rakurea The notification for his retirement was received late at this office, leaving us with no choice but to cease his wage and recovery could not take place since he has not been working for quite sometime.
IP Timoci Narova In this case it is the same has the one for SC 125 Meli R the notification was also receives later at our section.

By the time we receive the memo the Pay period for the next pay has already close.

Therefore we could not recover his salary.

17.14 Occupation of Quarters Inspectorate Officers and Subordinate Officers will occupy police quarters where these are available.
Police Subordinate Officers who occupy maisonette quarters may at the discretion of the Commissioner of Police be required to vacate them on being promoted to the rank of Inspector.

In normal circumstances two month notice to vacate will be given.15 On receipt of the copies sent to the Commissioner of Police, Officer in charge Central Registry will file duplicate form on the personal file of the officer concerned.
He will forward the original and the quadruplicate to the Force Accountant for further action who will ensure rent deductions are made or that they cease as the case may be.16 15 Force Standing Order- Chapter VIII- Quarters and Lodging Allowance- No.
208- Quarters 1 16 Force Standing Order- Chapter VIII- Quarters and Lodging Allowance- No.208- Quarters 23 Fiji Police Force Section 17: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Any Gazetted officer or Inspectorate officer occupying an institutional quarter who finds that no rent has been deducted from his salary within two months of his entering into occupation will report the fact to the Force Accountant.17 Some officers based in the Central Division are occupying Police Quarters that they are not entitled after being promoted.
This issue was highlighted in previous years audit reports for which the Department was supposed to surcharge those occupying quarters outside of their entitlement.

The surcharges have yet to be imposed.

Some officers are also occupying Grade VI quarters instead of Grade V which is their entitlement.

Grade VI quarters are provided free water and electricity.
Details of the rent owed by the Officers are shown in Table 17.5 including the charges for water and electricity: Table 17.5: Officers occupying Grade Six quarters instead of Grade Five EDP No.

Name of Officer 51604 ASP Jaswant Lal 50298 ASP Itendra Nair 51023 ASP Rusiate Tudravu 51730 IP Anare Masitabua 50703 IP Sashi Kant 50189 IP Atma Nand Overpaid Amount as at 02/12/07 ($) Remarks 9,457.06 The Officer is occupying Inspectorates quarters with effect from 04/01/06.
He is surcharged with a rental deduction of $480 per month from the date of his illegal occupation of quarters but until 02/12/07 no deduction was made from his salary.

The officer is currently paying rent of $27.69 fortnightly.

11,211.95 The Officer is occupying Inspectorates quarters with effect from 13/04/06.

He is surcharged with a rental deduction of $660 per month from the date of his illegal occupation of quarters but until 02/12/07 no deduction was made from his salary.
The officer is paying rent of $27.69 fortnightly with effect from 30/07/06.

4,656.25 The Officer is occupying Inspectorates quarters with effect from 02/11/06.

He is surcharged with a rental deduction of $480 per month from the date of his illegal occupation of quarters until 01/10/07.

The officer vacated the quarters on 02/10/07 but until 02/12/07 no deduction was made from his salary for the surcharge imposed.

The officer was paying rent of $27.69 fortnightly.


11,534.94 The Officer is occupying Subordinate quarters with effect from 29/04/05.

His market rental rate is $390.00 per month for the period of his illegal occupation of quarters.

The officer is paying rent of $61.54 fortnightly with effect from 13/08/07.

5,766.42 The officer was occupying Subordinate quarters with effect from 17/07/06.
He is surcharged with a rental deduction of $390.00 per month from the date of his illegal occupation of quarters until 11/11/07.

The officer vacated the quarters on 12/11/07 but until 02/12/07 no deduction was made from his salary for the surcharge imposed.

He was paying rent of $61.54 fortnightly with effect from 13/08/07.

1,733.57 The Officer was occupying subordinate quarters with effect from 23/04/07 until 01/10/07.
From 02/10/07 the 17 Force Standing Order – Chapter VIII- Quarters and Lodging Allowance- No.

208- Quarter 24 Fiji Police Force Section 17: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 EDP No.

Name of Officer Overpaid Amount as at 02/12/07 ($) Remarks 51543 IP Joseph Low 52450 IP Sreupepeli Niko 51521 IP Selesitino Babakoro officer is occupying quarters of his rank.
He is paying rent of $61.54 with effect from 30/07/07 but from 02/10/07 his rent deduction should be $27.69.

The officer should be paying a rent of $390 per month for the period he was illegally occupying the quarters.

2,700.00 The Officer is occupying subordinate quarters with effect from 23/04/07.

His market rental rate is $390.00 per month from the time he is illegally occupying the quarters.

3,490.68 The Officer is occupying subordinate quarters with effect from 18/01/07.
His market rental rate is $390.00 per month from the time he is illegally occupying the quarters.

He is paying rent of $61.54 with effect from 13/08/07.

3,863.54 The Officer is occupying subordinate quarters with effect from 22/11/06 and from 13/08/07 is paying a rent of $61.54 fortnightly.

His market rental rate is $390.00 per month from the time he is illegally occupying the quarters.
Direct salary deductions for the full amount of new rental charges imposed by Management was not able to be incorporated into the payroll system as the system is not accepting any amount in excess of $61.54 per fortnight.

Recommendations • The Force should ensure that Quarters Occupation Returns are submitted to Headquarters, specifically, the Accounts Section to ensure that rent are deducted from the salaries of those officers who are supposed to be paying rent.
• The current and arrears of rent should be deducted from the officers who occupy the government quarters.

• An investigation should be carried out for all Divisions to ensure that those entitled are occupying quarters.

• Disciplinary action should be taken against officers who fail to vacate the quarters within the given period of time.
Management Comments Our authority to deduct rent from officers occupying government quarters is the Occupation Slip which is supposed to be issued by relevant authorities once officer moves into a government rented quarter.

If there is no occupation slip, the salary section will not be able to deduct rent as rent deducted will be calculated on the information provided in the occupation slip in line with the approved rent stipulated in the General Order.
In the case of Gazetted Officers, the current rent deducted is on Special Grade.

At this point we are still awaiting approval from the Public Service to institute the ‘market value’ rent from the officers as highlighted in the query.

This will only be possible when approved, a special code is provided by the Ministry of Finance to accommodate this.
Fiji Police Force Section 17: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.15 Receiving Allowances while on Overseas Leave No allowances will be paid to any officer whilst he is on vacation leave or during any period of absence without leave in excess of 24 hours.18 As soon as any police officer ceases to be eligible for an allowance which he is being paid, such fact will be reported by his superior officer through normal channels to Police HQ for cancellation of the allowance.19 Some officers, while on overseas (annual or long service) leave, were still receiving acting, plain cloth, CID and extra duty allowances.
Refer to Table 17.6 for examples: Table 17.6: Officers Receiving Allowances while on Overseas Leave EDP No.

Name of Officer Overpaid Amount As At 16/12/07 ($) Remarks 50891 50225 50317 51186 CPL Tevita Latai Kama ASP Collin Powell Kishore CPL Kumar CPL Prem Chand 982.10 Overpayment of acting, plain cloth, CID and extra duty allowance with effect from 27/12/06 until 10/03/07.

505.26 Overpayment of extra duty allowance with effect from 26/02/07 until 23/04/07.
The officer resigned from the service on 17/06/07.

221.06 Overpayment of extra duty allowance with effect from 17/05/07 until 19/07/07.

230.67 Overpayment of extra duty allowance with effect from 29/05/07 until 30/07/07.

The discrepancies highlighted above are a result of the lack of supervisory control and checks in the Salary Section.

Recommendations Recovery of overpaid allowances through direct salary deductions should commence immediately.
Management Comments 50891 Tevita Latai Kama – we are unable to recover the amount owed as the officer has resigned from the force.

50255 Collin Powell – the officer has resigned from the Force and we are unable to recover the overpayment.

fortnight vide FS03/272074.

50317 Kishore Kumar – the officer’s salary has been terminated from 10/7/08.

Recovery is not possible at this stage.

51186 Prem Chand – officer has been terminated.

Recovery overpayment is now not possible.


18 Force Standing Order 56 (4) 19 Force Standing Order 56 (8) Fiji Police Force Section 17: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.16 Follow Up – Overpayment of Salaries from 2004 to 2006 Issues Overpayment of Salaries – Resignation The Department continued to pay the salaries of officers after they have effectively resigned from the Force resulting in overpayment of salaries.
Refer to the following for examples Name PC 2890 Hakeem Raja PC 393 Sofaia Matawalu PC 2410 Samuela Suguturaga PC 2557 Peceli Cama Amount ($) 732.68 3,557.55 2,641.37 1,040.69 • • • Recommendations Action Taken No action taken by the Department to recover the overpaid salaries.

• Salary overpayments should be recovered from relevant officers.
And in cases where recovery is not possible, the Force should investigate the cause of the overpayment and surcharge responsible officers for the amount not able to be recovered.

It is recommended that the payment for leave compensation be withheld until the salary change advice is submitted to the Ministry of Finance.
It is also recommended that a list of officers that have resigned from the Force should be provided to the Accounts Section by the HRM and Administration Section on a fortnightly basis for verification purposes.

The Force by communicating and coordinate matters affecting payroll in a timely manner between the Administration Section and the Accounts Sections.
should address shortcomings these Overpayment of Salary – Retirement ASP Pachappa Pillay officially retired from the service with effect from 13/04/06.

However, the payment of his salaries and other taxable allowances did not cease until 07/10/06 resulting in a substantial overpayment of salary amounting to $14,810.60.

The salary and allowances of Sergeant Raja Hittam continued to be paid to his bank account until 30/12/06 even though the officer passed away on 16/11/06.
The above resulted in a salary overpayment of $2,311.74.

Overpayment of Salaries – Interdiction from Duty Audit noted some cases where officers who were interdicted on half salary continued to be paid their full salaries and allowances after the effective date of interdiction.

The overpayments of salaries were not recovered.

Refer to the Table below for examples • Since the amount overpaid is a substantial, the Department should seek other avenues to enable the recovery of the overpaid salaries.
In case where recovery is not possible, the Force should investigate the cause of the overpayment and surcharge responsible officers for the amount not able to be recovered.

• No action taken by the Department to recover the overpaid salaries.

• should instituted measures The Force improve communications and co – ordination between the relevant Units to ensure actions are taken as soon as possible and to avoid unnecessary overpayments made to the Officers.
• Salary overpayments should be recovered from relevant to No action taken by the Department to recover the overpaid salaries.

Fiji Police Force Section 17: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations Action Taken officers.

And in cases where recovery is not possible, the Force should investigate the cause of the overpayment and surcharge responsible officers for the amount not able to be recovered.
• The Force should ensure that Quarters Occupation Returns are submitted to Headquarters, specifically, the Accounts Section to ensure that rent are directly deducted from the salaries of those officers who are suppose to be paying rent whilst occupying Quarters.

• Outstanding rent should be deducted from the respective officers’ salaries and for those officers who continue to occupy the quarters have the rent deducted accordingly.
• An investigation should be carried out for all Divisions and respective Stations to ensure that only officers, who are entitled, occupy quarters.

• Disciplinary action should be taken against officers who fail to vacate the quarters within the given period of time.

The Department with the assistance of Department of Lands obtained the market value of rent to Nasova/ Nasese illegal and Valelevu quarters.

The occupants were a memorandum on the current market rent rate surcharged upon them.
To date, to commence.

issued with deductions have yet For other divisions, no market rate is established as yet and no recovery is made till to the date of audit.

For some officers rent as per General Order is charged but it is only for the current period.

EDP No.

Issues Name 76110 57292 PC Josua Torau PC Atunaisa Kuruibo Occupation of Quarters Amount ($) 900.06 4,519.85 Audit noted that officers based in the Central Division are occupying Police Quarters after being promoted to the rank of Inspector.
Moreover, the officers failed to pay rent on their Grades as required when officers are promoted to the rank of Inspector or above but still occupy Police Quarters.

In addition, the officers are occupying Grade Six quarters instead of Grade Five which is their entitlement.

Grade Six quarters have free water and electricity whilst occupants of Grade Five quarters are required to pay their own electricity and water bills.
Details of the rent owed by the Officers are shown in the Table below, which excludes the charges for water and electricity.

EDP No.
Name 51588 50971 51934 50226 50272 50679 50012 51545 51641 50472 50731 IP Lavenia Lovodua IP Solomona Tui IP Hasmat Ali IP Diwan Chand IP Jitendra Kumar IP Erami Raibe IP Sakuisa Tikotani IP Kishore Kumar IP Ulaiasi Ravula IP Raj Kumar IP Permal Yentesh Navosa and Nasese Amount as per 2006 report($) Market Rate charge for illegal occupation ($) 506.34 423.27 1,861.56 1,587.06 670.50 1,633.83 670.50 1,861.56 1,600.92 1,861.56 2,063.06 6,351.44 5,380.66 14,683.42 13,371.44 7,418.58 13,692.90 3,998.58 14,692.34 7,701.46 12,587.54 15,991.20 Fiji Police Force Section 17: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Issues Recommendations Action Taken EDP No.
Name 51284 A/SSP Jonasa Leakai 49650 ASP Ram Chetty Yenkataiya 51112 ASP Sera Bernard 51023 A/ASP Rusiate Tudrau 50645 IP Keshwan Southern Division EDP No.
Name 51600 51372 51346 50959 IP Manoj Singh IP Sakiusa Nakalevu IP Nacanieli Veremalua IP Jese Ulacake Amount as per 2006 report($) Market Rate charge for illegal occupation ($) 1,934.20 23,058.40 2,387.95 No market rate provided 1,459.92 11,508.27 1,731.18 No market rate provided 1,734.96 No market rate provided Amount as per 2006 report ($) 1,842.07 1,554.78 350.40 663.24 Officers Occupying Quarters and Also Receiving Lodging Allowances Audit noted that some officers’ who are occupying Police Quarters are also receiving lodging allowance.
Refer to the Table Below for details: • Payment of lodging allowance to those officers that are not entitled to such allowances should cease immediately.

Name Amount as per 2006 report($) Overpayment as at 18/11/07 ($) Rohitesh Choy 1,913.03 437.55 Total Overpaid Amount ($) 2,350.58 • • Recovery of overpaid allowances through direct salary deductions should commence immediately for those that have yet to repay the overpaid lodging allowances.
It is also recommended that Police Officers are made aware of the Standing Orders and that it is also their individual responsibility to inform their immediate Supervisor or the Administration and the Accounts Sections if they are receiving allowances outside their entitlements.

Fiji Police Force Section 17: Page 17 No action taken by the Department to recover lodging allowances.
overpaid the REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Issues Recommendations Action Taken Overpayment of Salary – Leave Without Pay PC Salend Pal’s application for leave without pay to pursue his studies at the University of the South Pacific was approved by the Commissioner of Police with effect from 13/02/06.

According to correspondences sighted by audit, the officer went overseas instead and tendered in his resignation from abroad.
Audit noted that the payment of the officer’s salary did not cease until Pay 10/06 resulting in an overpayment of salaries amounting to $3,680.36.

In addition, the 2005 audit also highlighted that the officer resigned from the Force on 31/03/05 and later applied for re – engagement into the Force, which was approved by the Commissioner of Police with effect from 06/06/05.
However, the officer continued to receive his salaries between the date he resigned and the date he rejoined the service resulting in an overpayment of salaries amounting to $2,952.05.

The overpayment was not recovered by the Department.
Refer to the Table below: Year 2005 2006 TOTAL Overpayment Amount ($) 2,952.05 3,680.36 6,632.42 Overpayment of Plain Clothes/ CID Allowance – 2005 Follow up Scrutiny of the payroll records indicated that a substantial number of Police officers are receiving allowances that they are not entitled resulting in overpayment of salaries.
Refer to the table below for examples Name Bhawani Chand Esira Dokoni Nischal Dass Maika Wavila Osea Qiolevu Ahmed Khan Esala Tokalau Amount as per 2006 report ($) 3,741.61 1,981.56 4,867.39 692.47 1,145.88 3,127.71 1,715.72 Amount Recovered ($) 50.00 1,104.52 - - - - - Amount not Recovered ($) 3,691.61 877.04 4,867.39 692.47 1,145.88 3,127.71 1,715.72 • • The Department should make arrangement with the officer to recover the overpaid amount.
If recovery is not possible, the Force should investigate the cause of the overpayment and surcharge responsible officers for the amount not able to be recovered.

The internal control procedures in the Payroll Section, specifically supervisory checks, should be strengthened to avoid such discrepancies.

No action taken.

The officer resigned from the service.

• All overpaid allowances should be recovered.


• The internal control procedures in Payroll section, specifically to avoid such supervisory checks, should be strengthened discrepancies.

• All police officers should be made aware of the Standing Orders and that it is also their individual responsibility to inform the Administration and Accounts Sections they are receiving allowances outside their entitlements.

if No action taken by the Department to recover the overpaid allowances.
Fiji Police Force Section 17: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Elia Lawenibua Salen Kumar Tevita Issues 2,877.07 4,799.89 530.04 - - - 2,877.07 4,799.89 530.04 Overpayment of Salaries – Interdiction from duties – 2005 Follow up Audit noted a number of cases where officers were continued to be paid full salaries although they have been interdicted from duty on half salary.
Refer to the table below for examples: Name Amount as per 2006 report ($) Akuila Maki Elia Lawenivula Gauna Vakalevei Viliame Gudrovoli Timoci Nauta Elic Mccomber Veer Chand Sheikh Khan Patrick Nayagilagilagi Uluaiasi Robanakadavu 700.86 1,604.68 696.39 790.17 831.59 2,204.76 2,332.66 2,589.70 522.38 868.61 Incorrect payment of salaries - Resignation Audit noted that Police Constable Ram Naidu was overpaid salary of $6,717.92 upon resignation.
Recommendations Action Taken • The force should address these shortcomings by communicating and coordinate matters affecting payroll in a timely manner between the Administration Section and the Accounts Sections.

• Salary overpayments should be recovered from relevant officers.

And in cases where recovery is not possible, the Force should the overpayment and surcharge investigate responsible officers for the amount not to be able to recover.
the cause of No action taken by the Department to recover the overpaid salaries.

No action taken by the Department to recover the overpaid salaries.

• • Salary overpayment should be recovered from relevant officer.

And in case where recovery is not possible, the Force should investigate the cause of the overpayment and surcharge responsible officers for the amount not able to be recovered.
It is recovered that the payment for leave compensation is withheld until the salary change advice is submitted to the Ministry of Finance.

It is also recommended that a list of officers that have resigned from the force should be provided to the Accounts section by the HRM and Administration section on a fortnightly basis for verification • Fiji Police Force Section 17: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Issues Recommendations Action Taken • purposes.
The Force should address these shortcomings by communicating and co-ordinating matters affecting payroll in a timely manner between the Administration section and the Accounts sections.

Over payment of lodging allowance – 2004 Follow up The 2004 audit highlighted numerous cases of overpaid lodging allowances.

A follow up on the recovery of these overpaid allowances revealed that the Department has yet to recover from these officers although the payments of lodging allowances have ceased.
Name Amount due as at 2004($) Overpayment after 2005 report ($) Usaia Waqa Akuila Senikurouri Apolosa Vunisa Maikeli Duve Peni Dagadaga 486.17 6,467.51 468.47 5,000.69 245.49 148.76 Total amount As at pay 06/07($) 486.17 6,467.51 468.47 4,207.26 394.25 Recommendation • Payment of lodging allowance should cease immediately to those officers that are not entitled to such allowances.

No action taken by the Department to recover the overpaid salaries.
• Recovery of overpaid allowances through direct salary deductions should commence immediately for those that have yet to repay the overpaid lodging allowances.

It is also recommended that police officers are made aware of the Standing Orders and that it is also their individual responsibility to inform the Administration and the Accounts Section if they are receiving allowances outside their entitlements.
• • The force should ensure that internal control procedures in the Payroll Section are strengthened so as to avoid such discrepancies.

The Department should take heed of audit recommendations and recover the overpaid salaries from the relevant officers.
Management Comments Resignation PC 2890 Hakeem Raja - $732.68 PC 393 Sofaia Matawalu - $3557.55 PC 2410 Samuela Suguturaga - $2641.37 PC 2557 Peceli Cama Fiji Police Force Section 17: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recoveries on the overpayments for these officers were not possible as they have already left the Force.
However, your recommendation to withhold leave compensation for the purpose of recovering overpayment is acknowledged and is currently assisting in that regard.

Retirement ASP Pachappa Pillay – Investigation is under way.

Sgt.

Raja Hittan – lack of co-ordination in the communication within the force has resulted in the overpayment.

Unfortunately we are unable to recover the amount.
Fiji Police Force Section 17: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.17 Arrears of Revenue Within one month after the end of each quarter, each agency with accounts receivable must submit a quarterly report on outstanding and overdue debts to the Ministry of Finance.20 The Police Department collects various types of revenue which includes issuance of firearms license permitting holders to purchase, acquire and possess the firearms.
Every license shall expire on the thirty-first day of December following the date of issue or renewal.21 Arrears of revenue from firearms license amounted to $13,067 as at 30/06/07, of which 82% of the arrears are over 2 years.

The total arrears stated in the Arrears of Revenue Return prepared by the Department were incorrect as a number of Police Stations failed to submit arrears of revenue reconciliation to the Accounts Section.
Moreover, the reconciliations from July to December 2007 were not carried out.

It also revealed that some firearm license holders have paid their license fees but because of poor record keeping, these may have not been taken into account in the Arrears of Revenue Return.

If the reconciliations of arrears of revenue are not carried out properly to include all relevant Police Stations, the amount reflected on Appendix 24 of the Accounts and Finance may be incorrect.
Recommendations • The Department should recover the arrears from the licence holders.

• Officers in charge of Police Stations should be directed to submit Return of Arrears of • Revenue so that the true value of the revenue in arrears can be determined correctly.

Irrecoverable arrears of revenue should be written off with the approval of Ministry of Finance.

Management Comments The Fiji Police admits the examination by your office raised in your report is true.
Therefore, in the Financial Year 2008 the Armoury Section has to provide the total number of firearms distributed.

The police stations on each division and they are duty bound to collect revenue on firearms identified by the said section so as the exact arrears of revenue is reflected.
17.18 Audit Limitation – Removal of Records by FICAC The Auditor General has the powers to audit the Accounts and Finance of Government Departments or Ministries established by law.22 In the exercise of his duties under the Audit Act, the Auditor-General or any person duly authorised by him shall be entitled –23 (a) to have access to all records, books, accounts, vouchers, documents, cash, stamps, securities, stores or other Government property under the control of any officer; 20 Finance Instructions 2005 – Section 50 21 Arm & Ammunition Act Cap 188 Edition 1978.
Section 6 (5).

22 Section 167 of the Constitution, the Audit Act (Cap 70) and the Finance Act 23 Audit Act – Section 7(2) Fiji Police Force Section 17: Page 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 (b) to send for and have the custody of any records, books, accounts, vouchers or documents under the control of any officer, and to keep such records, books, accounts, vouchers or documents for such time as he or she may require them.
With the exception of Payroll, audit could not verify and substantiate the accounts, finance and transactions of the Department for the period 01/01/07 to 31/05/07 as all relevant documents were removed by the Fiji Independent Commission Against Corruption (FICAC).

The total non-payroll expenditures incurred by the Department from January to May amounted to $3,674,191, which is 34% of the non-payroll budget.
Refer to Table 17.7 for details: Table 17.7: Expenditures records not provided for audit verification Allocation SEG & Expenditure Item Activity 1 120101 Total Activity 1 Activity 2 120102 Total Activity 2 Activity 3 120103 Total Activity 3 Activity 4 120104 Total Activity 4 Activity 5 120105 Total Activity 5 Activity 5 120105 3.

Travel & Communications 4.

Maintenance & Operation 5.

Purchases of Goods & Services 6.

Operating Grants & Transfers 7.

Special Expenditures 8.

Capital Construction 9.


Capital Purchases 3.

Travel & Communications 4.

Maintenance & Operation 5.

Purchases of Goods & Services 6.

Operating Grants & Transfers 7.

Special expenditures 3.

Travel & Communications 4.

Maintenance & Operation 5.

Purchases of Goods & Services 6.

Operating Grants & Transfers 7.

Special expenditures 3.

Travel & Communications 4.

Maintenance & Operation 5.

Purchases of Goods & Services 3.

Travel & Communications 4.

Maintenance & Operation 5.


Purchases of Goods & Services 6.

Operating Grants & Transfers 7.

Special expenditures 3.

Travel & Communications 4.

Maintenance & Operation 5.


Purchases of Goods & Services Total Activity 6 TOTAL EXPENDITURES Amount Expended ($) 1,085,328 538,137 214,432 - 34,034 - 66,259 1,938,190 14,798 9,925 1,296 - 64,535 90,554 124,122 6,203 4,052 - 19,360 153,737 10,611 773,490 1,066 785,167 16,157 - 44,219 - 3,967 64,343 427,698 100 214,402 642,200 3,674,191 The audit is unable to express an opinion on the activities and accounts of the Department from January to May 2007.
Fiji Police Force Section 17: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendation The Department should provide all the relevant records for audit verification in order to ascertain whether the accounts of the Department are free of fraud, error and material misstatements.

Management Comments The Fiji Police will provide the document in question to the office of the Auditor General once released from FICAC.
17.19 Purchases from Lotus Garment Ltd Public tenders may be called for procurement of goods, services or works valued at $20,000 or more unless a Tender Board had approved an exemption in accordance with Finance Instruction 12(6).24 On 24/08/07, the Major Tenders Board in its meeting No.
49/0725 approved the supply of Police Uniforms from Lotus Garments Ltd as highlighted in the Table below: Item Particulars Trousers Navy Blue Hi-Visibility Reflective Police Rain Jacket Concealed Hood/ Reflective Vest 8,000 pieces @ $18.90 = $151,200 VIP 1,000 pairs @ $240 = $240,000 VIP / In the same meeting, the Major Tenders Board put on hold the decision for the supplier of Sky Blue shirt, Khaki Trousers and Silver Grey shirt.
However the Department continued to make unauthorised purchases from Lotus Garments Ltd although cautioned by audit in the 2005 & 2006 reports to obtain proper approval.

Refer below for example: Chq No.

& Date 623633 of 29/06/07 Particulars Amount ($) Being payment of account for the following LPOs for supply of Silver Grey Uniform and Sky Blue Shirt with Trousers: 250,200.00 LPO No.

880 - Invoice 8900 LPO No.


888 - Invoice 9801 The Department also purchased 2,000 leather pouches at a total of $78,750 from Lotus Garments Ltd without seeking the approval of the Major Tenders Board.

At the time of the audit, the cost of the leather pouches were yet to be settled.

The continued purchases from the particular supplier demonstrates deliberate disregard of regulations governing the procurement of goods and services.
Recommendations • The approval of Major Tender Board must be obtained for any purchases above $20,000.

• Disciplinary actions should be taken against those who continue to disregard regulations governing the procurement of goods and services.
24 Fiji Police Force Finance Manual 2005 Section 2.3.1 25 Major Tender Board, Tender CTN 49/07 Supply of Uniforms - Police Fiji Police Force Section 17: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments The bureaucratic stand for the decision made by the major Tender Board at its meeting held on 7/8/08 to hold the purchase of the items in question is bureaucratic rigid and does not hold the practical operation and the technical demand of the Fiji Police Force.
The constitutional objective of the Commissioner of Police is to administer and be accountable to the member of the Fiji Police Force so as to fulfil the Section 7 and 60 (b) of the Police Act – Chapter 85.

The items in question was urgently needed as a requirement under the said legislation, the materials were available at the Lotus Garments thus purchase were made.

17.20 Missing Payment Vouchers All payments must be processed through the payment vouchers prepared by the Accounts Officers.
Separate vouchers are to be used for separate payees and for the payment of different services.26 Some payment vouchers were missing from the batch of payment voucher files provided for audit.

Therefore, the authenticity and correctness of the payments could not be substantiated.

Refer to Table 17.8 for examples: Table17.8: Missing Payment Vouchers Date Cheque No.
Payee 09/07/07 09/07/07 09/07/07 09/07/07 09/07/07 10/07/07 29/06/07 27/06/07 27/06/07 27/06/07 19/07/07 19/07/07 19/07/07 19/07/07 19/07/07 19/07/07 19/07/07 19/07/07 22/10/07 623970 623973 623975 623976 623979 623996 623595 623494 623524 623556 624452 624453 624373 623730 623731 623732 623733 623481 627929 Brijlal & Co Pepe’s Duty Free Shantilal Bro’s Suva Stationery Toner Tech Ltd Nivis Motors Kemueli R J. S. Onisimo Maharaj Minimart Kemueli R C/o CPS Colonial health Dai-ichi Motors ANZ Bank of Baroda CNB Commissioner of Police Vodafone Fiji Ltd Lotus Garments Ltd Amount ($) 160.00 110.00 10,152.00 4,999.98 80.00 10,703.59 485.00 928.20 204.30 425.00 828.00 56.62 550.00 4,413.50 368.02 9,486.62 650.75 13,643.13 255.00 Missing payment vouchers increases the risk of fraud and mismanagement of funds and indicate poor maintenance of accounting records.
Recommendations • The Department should ensure that all the Payment Vouchers are filed intact for audit purposes.

• The missing payment vouchers should be provided for audit purposes.

26 Police Department Finance Manual 2005.


Section 2.8.1 Fiji Police Force Section 17: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments The office of the Force Accountant have to locate the where about of the vouchers in question and inform the Auditor General accordingly for its inspection.

17.21 Civil Litigation In 2007, the Department was allocated $40,000 to meet civil litigation claims.
Audit noted an over-expenditure of $24,797 in the budgetary allocation for civil litigation.

Of the total expenditure incurred, audit was not able to verify expenditures totalling $34,711 due to the removal of records by FICAC.

On 6/09/07, Department Warrant 143/2007 for $22,000 was issued to the Solicitor General for an out of Court settlement in a civil action case between Alexander Whippy v Isireli Tora & Attorney General.
PC Isireli Tora, a driver with the Department, was involved in an accident with the plaintiff and was convicted of careless driving.

The Department has yet to take any action to recover the amount paid from the driver.

PC Isireli Tora is still employed by the Department.

Recommendation The Ministry of Finance should surcharge PC Isireli Tora the amount paid to the plaintiff in the out of court settlement.
Management Comments The amount of $24,797 which exceeded the budget provision was regularized by virement warrants prepared at the end of the financial year 2007.

Regarding the conviction of an officer on careless driving which cost the Fiji Police Force $22,000, the Fiji Police Force will identify and inform the Ministry of Finance on the amount to be surcharged.
17.22 Maintenance of Cheques The Assistant Accounts Officers Payments or the Assistant Accounts Officer Ledgers shall enter details of cheques drawn into a Payment Cashbook before they are issued.

The cashbook shall contain details of the payee, payment date, ledger account, cheque details and the amount paid.27 The following anomalies were noted: • Some payments made by the Department were not recorded in the cashbook.

Refer to the Table below for examples: Payee Cheque No.
624572 624573 Metuisela Vulaono 624541 Chottu’s Motel Akeneta Tokana Amount ($) 99.00 63.00 57.75 27 Police Department Finance Manual 2005.

Section 2.8.8 Fiji Police Force Section 17: Page 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Cheque No.

Payee 624542 Commisssioner of Police 624543 Divisional Special Branch Amount ($) 3,000.00 522.00 • Cheques were not issued in a sequential order.
Refer to the Table below for examples: Date Used 19/07/07 19/07/07 -23/07/07 24/07/07 -27/07/07 27/07/07 30/07/07 – 03/08/07 03/08/07 -14/08/07 05/08/07 -29/08/07 Cheque No.

624442-624500 625101-625194 625001-625069 625195 -625336 625070-625491 624502-624999 625501-626000 • Cheques that have been cancelled in the cashbook; were still appearing in the FMIS28 payments register.

Refer to the Table below for examples: Date 20/07/07 19/07/07 03/08/07 20/07/07 31/07/07 01/08/07 21/06/07 Cheque No.
251178 - 251185 624487 624522 625178 - 625185 625438 625452 623203 - 623204 The above anomalies highlight poor payment control procedures by the Department which could result in double payments and mismanagement of funds.

Recommendations • The Department should ensure that all relevant payment details are properly entered in the Cashbook.

• The Department should ensure that cheques are written in a sequential order to avoid mismanagement of funds.
• FMIS system should be updated as soon the transactions occur to avoid misrepresentation of data.

Management Comments The Assistant Accounts Officer Payments will be officially informed to ensure that all cheques issued are recorded in the cash book and cheques are generated in sequential order.

17.23 Court Exhibits Upon completion of the case in a court of law the prosecuting officer shall request the magistrate or judge to make an order for the disposal of exhibits.
The order shall be effective upon the completion of 28 days appeal period.29 28 Finance Management Information System.

29 Procedures for Seizure, Management & Disposal of Exhibits.
Section 5.3.1 Fiji Police Force Section 17: Page 27 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Officer in charge of an Exhibits Store should be responsible for the correct maintenance of the Register of the Court Exhibits.30 Upon receiving the exhibits, the particulars are entered into the Exhibits Register before they are taken to the Exhibit Room.

All exhibits shall be kept in a locked and secure exhibit store.
There shall be only key available to this store which shall be kept in the possession of the Crime Writer or Station Officer.31 Before handling exhibits, the investigating officer shall ensure that occupational health and safety procedures are followed in handling seizure items both at the place of seizure and on Fiji Police premises when the said exhibits are under their custody in accordance with Occupation and Health safety procedures such as identifying potential hazards, taking necessary care to manage these hazards, providing staff under their duty of care with the appropriate safety clothing and equipment.32 The following anomalies were noted: Exhibits Not Yet Returned to the Owners Exhibits pertaining to cases that have been discharged or ordered by the Court to be returned to the legal owners are still maintained in the Exhibit Room.
The Exhibit Writer revealed that the Stations have not been able to locate the legal owners of the exhibits as some have changed their addresses.

Refer to Table 17.9 for examples: Table 17.9: Exhibits not yet returned to the Owners Exhibit No.

Crime Register No.
Samabula Police Station 03/07 06/07 07/07 08/07 09/07 10/07 14/07 15/07 380/95 PEP 89/97 577-579/97 PEP 26/2000 PEP 100/2000 UB 1/02 430/94 1171/93 539/93 16/07 875/93 17/07 765/88 18/07 PEP 87/90 19/07 20/07 CR 144/91 Valelevu Police Station 108/07 126/06 221/07 290/07 - - - - Item Description Assorted imitation jewelleries, Fijian & American currencies Cash $40 Cash $50.20 & Queen’s Pawn Shop receipt Exercise Books & Cash 1 counterfeit note to be given to RBF for disposal Cash $25 to be deposited to govt Revenue account Accessories & cash $13 Purse, gold chain and cash $10 (Indonesian currency) and $10 (Singapore currency) Cash $160 Diamond sapphire bracelet and earrings Cash $12 Cash $13 Cash $11.84 Fake notes: to be given to RBF for disposal - 7 @ $20, 4 @ $10 Cash $14.99 Cash $151 Cash $2,000 Cash $1,000 Cash $1,000 Cash $770 Cash $1,010 30 Fiji Police Force Standing Orders 313 (21) 31 Fiji Police Force Standing Orders 313 (17) 32 Fiji Police Force – Procedures for Seizure, Management and Disposal of Exhibits – 5.2.1.3 – Duties of Investiging Officer – (c ) Fiji Police Force Section 17: Page 28 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Exhibit Rooms The Exhibit Rooms in the various Police Stations are too small to properly maintain the increasing number of Court exhibits.
As a result, exhibits are not stored properly and are scattered and piled on top of each other affecting the longevity, accessibility and proper accountability of the exhibits.

Refer to the following photographs for examples: Exhibit Room – Samabula Police Station Exhibit Room – Nausori Police Station The court exhibits at the Valelevu Police Station are maintained in the Exhibit Writer’s office and two storage containers outside the Police Station complex.
The storage containers are not suitable for storing exhibits as the conditions of some exhibits such as alcohol have been adversely affected.

Court exhibits are also maintained on top of the storage containers and are accessible to the public.
Refer to the following photographs for examples: Exhibit Writers Room – Valelevu Police Station Exhibits on top of the storage containers – Valelevu Police Station Storage containers used as Exhibit Room - Valelevu Exhibits inside the storage containers - Valelevu Fiji Police Force Section 17: Page 29 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Exhibits Not Recorded - Samabula Police Station Some exhibits stored in the Exhibit Room have yet to be recorded in the Exhibit Register.
This was due to improper handing over by the previous Exhibit Officer.
Refer to the Table below for examples: Item Description 5* white plastic chair 3 piece sofa set 1 white plastic table 1 boat engine – Johnson (Sea horse) 1 TV Cabinet Scrap metals Blue Car Jack 4 Carton Stubbies (375 ml) 4 Carton Stubbies (750 ml) Black pipes Missing Exhibits: Valelevu Police Station Physical verification of a sample of valuable exhibits at the Valelevu Police Station exhibits revealed that some items have been misplaced.
Refer to Table 17.10 for examples: Table 17.10: Missing Exhibits Case Exhibit No.
Item 46/07 49/07 65/07 74/07 75/07 86/07 105/07 139/07 147/07 171/07 202/07 451/07 452/07 Cash $265.00 Cash $27.00 White pair of Nike canvas Kenwood Stereo Cash $8.00 Jewelleries (Gold plated, pearl earrings, gold & imitation necklace) Car stereo (Pioneer) A Sony stereo, two remote & two Hindi tape Video tapes & deck 2 black Kenwood speakers & CD’s Black Addidas wallet in brown envelope Sunglass 2 set perfumes, battery charger, 2 black cable & digital camera cable Various Discrepancies - Nausori Police Station Audit noted the numerous discrepancies in the maintenance of the exhibits at the Nausori Police Station.
Refer to Table 17.11 for details: Table 17.11: Discrepancies noted in the maintenance of the exhibits Exhibit Index Date Discrepancies 12/07 29/12/07 A $10 note was kept in exhibit.
However the new serial number AF660555 was different 66/07 29/12/06 Fiji Police Force from the serial number written in year 2006; Reference Exhibit Index 14/06 3 * $10 recharge cards were missing from the Exhibit Room Section 17: Page 30 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Exhibit Index 152/07 Date 29/12/06 153/07 29/12/06 Discrepancies 29 * $15 recharge cards not recorded in the Exhibit.
Register 3 Westpac deposit books not recorded in the Exhibit Register The serial numbers of all the notes currencies were not written in the Exhibit Register.

3 bank deposit slips were not recorded in the Register.

• • • • Total of $37.85 was missing: 21 * 50 cents.

119 * 20 cents.

41 * 5 cents 50 * 2 cents.

50 * 1 cent.

$43.75 not recorded in the Exhibit Register.

Total of $370.31 was missing.


401/07 642/07 219/07 29/12/06 29/12/06 29/12/06 Exhibit containing 1 * 6 large bottles of Fiji Bitter was to be returned to the lawful owner on 220/07 29/12/06 221/07 29/12/06 440/07 29/12/06 567/07 29/12/06 27/03/06, however it was not returned.

1 * 7.5 large bottles of Fiji Bitter was to be returned to the lawful owner on 27/03/06, however it was not returned.

2.5 large bottles of Fiji Bitter were to be returned to the lawful owner on 24/10/06, however were not returned.
5 large bottles of Fiji Bitter were to be returned to the lawful owner on 18/05/07, however they were not returned.

1 Gas Cylinder was to be returned to the lawful owner on 15/06/06, however it was not returned.

568/07 29/12/07 Exhibits noted below were to be returned to the lawful owner on 14/06/06, however were not returned.
• • • • • 1 * 750 ml Regal Whisky 1 Tonne brown clothes 1 pinch bar 1 pad lock (Damaged) 15 nails 569/07 1678/07 29/12/06 Exhibits containing 3 piece brown colour sofa set was burnt by the Station due to lack of storage space and deteriorating condition of the sofa set.

Prior approval was not taken from the Court.

1 * Panasonic Radio was missing.

N/A It was also noted that protective clothing and equipment are not issued to officers looking after the exhibits.
It is the responsibility of the Department to equip the Exhibit Writer with proper equipment and provide adequate and proper storage space for all exhibits under their control to ensure that the integrity as evidences in court proceedings, other judicial proceeding or for further police investigation are not jeopardised.
The above discrepancies indicated the lack of internal control in safeguarding exhibits and non – compliance with the Procedures for Seizure, Management and Disposal of Exhibits policies which increases the risk of theft and misappropriation of exhibits.

Recommendations • All exhibits relating to police investigations that have been completed and gone through the Courts be returned to the rightful owner or properly destroyed according to the Procedures for Seizure, Management and Disposal of Exhibits.
• Proper handing over should be conducted when changing Exhibit Writer.

• All unrecorded exhibits should be recorded in an Exhibits Register as soon as possible.

Fiji Police Force Section 17: Page 31 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • Regular inspection should be carried out to ensure that all exhibits under custody are safeguarded from thefts and misappropriations.
• The Department should ensure that the Officer responsible for the exhibits is supplied with protective clothing and equipment while handling the seizure items.

Management Comments Valelevu Police Station The item description questioned in your report are still kept at their respective police station except the fake notes that were delivered to the Reserve Bank of Fiji for its disposal.
Exhibits Rooms – (7.4.2) The Fiji Police Force has submitted to the Ministry of Finance & Planning requests for funding on the constructions of Exhibit Room’s through the 2009 PSIP Budget preparation.

Exhibits Not Recorded in the Exhibits Register – Samabula Police Station (7.4.3) Instructions were forwarded to Station Officer Samabula to ensure that all exhibits received are to be entered and recorded in the Exhibits Register as in accordance with the Force Standing Orders.
Missing Exhibits – Valelevu Police Station (7.4.4) Upon examinations made on the exhibits on 25/0708 it was observed that our of thirteen (13) exhibits in question only four (4) were missing.

Various Discrepancies – Nausori Police Station (7.4.5) S/N 1 Exhibit No.

12/07 66/07 152/07 a) 29 $15 Recharge Card b) 3 Bank slips 153/07 401/07 642/07 1678/07 220/07 221/07 440/07 567/07 568/07 569/07 Remarks The S/N AF 660555 has not changed.
On the register there are two similar numbers but one was with the alphabet that AF 3x10 Recharge Card is missing presumably misplaced.

These recharge cards are old and torn.

The crime writer have been addressed on this issue.

3 Westpac Deposit Books has been registered as RCE 153/07.

As for the S/No.

all numbers were recorded in 2006 but when enties were carried forward in 2007 the Crime Writer forgot to record.

Crime Writer have been addressed on this issue.


- Relevant CR to be determined and shortfall will be addressed - As above The exhibit have been found which was misplaced in SO’s safe Physical check was made and found that $10.00 was not recorded.

It is believed that the mistake arose during the original counting exhibit.

Another physical check made and found that there was no money missing.

Serial numbers checked and found them all recorded.

Exhibit found in the exhibit room.


This is due to lack of space in the exhibit room.

Destroyed by pouring today 7/4/08 As above Exhibit returned to owner Mrs. Ping Chan on 5/4/08 Exhibit returned to lawful owner on 7/4/08 Exhibit will be returned next week Owner have been asked to come and collect exhibit by next week All queries have been noted and actioned to ensure that no future shortfall as far as exhibit is concerned please.
Fiji Police Force Section 17: Page 32 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 17.24 Delays in Recovering Surcharges If a surcharge is imposed, the driver shall be informed in writing.

The Solicitor General (SG) shall also be notified of the surcharge action.33[1] There is a delay by the Department in recovering costs of repairing motor vehicles from drivers that caused accidents due to carelessness and negligence.
Numerous requests by the Office of the Solicitor General and the Ministry of Finance for relevant information have not been provided by the Department.

Refer to Table 17.12 for example: Table 17.12: Delays in recovering Surcharges Vehicle Registration No.

GM 793 Ilisoni Toronivau Driver Remarks GM 644 Laveni Taukalau GM 167 - GM 197 & GM 095 Lemeki Toutou GN 295 Isimeli Kunabuli GM 606 - The accident occurred at Raviravi, Ba on 10/03/04.
The Department was notified by the Office of the Solicitor General and the Ministry of Finance on 19/04/05 and 06/06/06 respectively to determine the cost of the accident in order to surcharge the driver.

A follow up request by the Ministry of Finance was submitted on 14/03/07.

However, the Department is yet to determine the cost of repairs to the vehicle to date.

As such, the costs of repairing the vehicle have yet to be recovered from the driver.
The accident occurred at Natabua , Lautoka on 05/03/02., Ministry of Finance notified the Department on 02/07/07 of surcharge action where by $20 per fortnight was to be deducted from the officer’s pay commencing from Pay 14 of 2007 until the total cost of $5,909.87 was recovered.

The Department has yet to commence the direct salary deductions as at the time of audit.

As such, the costs of repairing the vehicle have yet to be recovered from the driver.
In a memo dated 04/04/06, the Office of the Solicitor General notified the Department to determine the cost of repair in order to surcharge the driver.

Ministry of Finance also sent reminder notices on 21/04/06 and 14/08/07 respectively for the Department to determine the cost of repairs to go ahead with the surcharge action.

However, the Department failed to determine the cost of repairs.

As such, the costs of repairing the vehicle have yet to be recovered from the driver.
In a memo dated 12/01/07, Ministry of Finance requested the Department to determine the cost of repair of both the vehicles in order to surcharge the driver.

A reminder notice was again given to the Department on 14/08/07.

However, the Department failed to determine the cost of repair.

As such, the costs of repairing the vehicle have yet to be recovered from the driver.
The driver was surcharged $12,553.90 by Ministry of Finance on 29/08/07 for causing accident to vehicle GN 295 for driving without due care and diligence on the 08/03/05.

However, to date the Department have yet to recover any cost of damage from the driver.

The vehicle was involved in an accident at Lautoka Police backyard on 01/03/00.

On 08/02/06, Office of the Solicitor General notified the Department to determine the cost of repairs in order to surcharge the driver.
The Ministry of Finance also requested for the cost of repairs in its 33[1] Police Department Finance Manual 2005.

Section 12.6.9 Fiji Police Force Section 17: Page 33 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Vehicle Registration No.

Driver Remarks memorandums dated 06/06/06 and 14/08/07.

However, the Department has yet to submit the actual cost of repairs so that action could be taken.
The attitude displayed by the Department in delaying the information required by the Ministry of Finance has resulted in the delay in surcharging drivers.

Recommendations • The Department should quickly determine the cost of repairs to vehicles damaged by accidents and submit the information to the Office of the Solicitor General and the Ministry of Finance to ensure that the costs are recovered from the relevant drivers.
• The Officer responsible for providing information requested by the Ministry of Finance should be disciplined for failing to carry out his/her duties effectively.

• Proper management and supervision controls should be employed by the Department to keep track of surcharges that have not been recovered.

Management Comments The management of the Fiji Police Force has to identify the cost of repair to the vehicles in question and forward a report to the Ministry of Finance recommending surcharge.
Fiji Police Force Section 17: Page 34 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 17.1 – Statement of Output Costs for 2007 Portfolio Leadership and Secretariat Support Description EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 12,712,725 77,082 2,368,994 1,552,893 660,900 19,956 83,590 17,476,140 5,920,365 40,393 2,270,871 1,594,037 1,114,301 25,860 1,090,066 12,055,893 0 119,802 - 119,802 4,027 613,081 - 617,108 Value Added Tax 1,108,556 1,804,232 TOTAL EXPENDITURE 18,704,498 14,477,233 Community Policing Description EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure 2007 $ 2006 $ 893,342 - 62,773 87,016 13,403 - 166,399 1,222,933 1,610,957 - 78,537 90,693 134,911 - 157,220 2,072,318 Value Added Tax 60,866 257,669 TOTAL EXPENDITURE 1,283,799 2,329,987 Fiji Police Force Section 17: Page 35 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Police Operations Description EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure 2007 $ 2006 $ 5,356,913 10,238 304,532 34,831 17,008 - 165,496 5,889,018 7,086,361 0 404,722 51,855 52,568 - 89,904 7,685,410 Value Added Tax 664,285 787,227 TOTAL EXPENDITURE 6,553,303 8,472,637 Criminal Investigation Description EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure
 Total Operating Expenditure Capital Expenditure Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure 2007 $ 2006 $ 118,611 36,936 27,547 1,983,054 20,313 1,578,946 46,453 82,958 2,079,110 33,891 2,186,461 3,821,358 188,437 - - 188,437 623,885 - - 623,885 Value Added Tax 308,705 519,614 TOTAL EXPENDITURE 2,683,603 4,964,857 Fiji Police Force Section 17: Page 36 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Fiji Police Intelligence Bureau Description EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure 2007 $ 2006 $ 229,794 91,190 36,351 - 194,678 - 37,787 589,800 4,738,249 103,960 36,316 - 220,418 - 36,769 5,135,712 Value Added Tax 49,151 500,150 TOTAL EXPENDITURE 638,951 5,635,862 Corporate Support Services Description EXPENDITURE Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Expenditure 2007 $ 2006 $ 38,022,313 688,446 860,086 186 894,103 - 51,111 40,516,245 30,902,836 692,884 1,462,276 14,294 1,172,946 - 61,388 34,306,624 Value Added Tax 3,209,394 4,432,984 TOTAL EXPENDITURE 43,725,639 38,739,608 Fiji Police Force Section 17: Page 37 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 18 Ministry of Education Programme Statement The Ministry of Education is concerned with broad policy issues on all aspects of education.
A major aim is to ensure that available resources are judiciously allocated and put to optimum use to ensure that relevance and quality of education is provided at all levels of the education system particularly in rural areas.

Educational policies are formulated within the framework of national goals so that the process of education distributes also to the achievement of Government’s broad outcomes.
The six major areas that the Ministry is responsible for include: • Administration of primary Education; • Administration of secondary Education; • Curriculum, Examination, Educational Resources Centre and Schools Broadcast Unit; Technical and Vocational Education and Training; • • Research and Development, Training and Fijian Education; and • Secondary Teacher training.
Table of Contents 18.1 18.2 18.3 18.4 18.5 18.6 FINANCIAL STATEMENT ..........................................................................................................................1 Audit Opinion .................................................................................................................1 Statement of Receipts and Expenditures.......................................................................2 Statement of Output Costs ............................................................................................3 Appropriation Statement ................................................................................................3 Statement of Losses ......................................................................................................3 Trust Account-Statement of Receipts and Payments.....................................................4 AUDIT FINDINGS ......................................................................................................................................4 Anomalies in VAT and FNPF Allocation.........................................................................4 18.7 Forgery of Bachelors Degree Certificate........................................................................5 18.8 Double Payments of Salary ...........................................................................................6 18.9 18.10 Cartage of Personal Effects ...........................................................................................6 Appendix 18.
1 – Statement of Output Costs.................................................................................8 FINANCIAL STATEMENT 18.1 Audit Opinion The audit of the 2007 accounts of the Ministry of Education resulted in the issue of a qualified audit report.

The accounts were qualified on the following grounds.

Ministry of Education Section 18: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 1.
The amounts in the Statements of Output Costs have been estimated as the facility to allow the measurement and accounting of these costs has yet to be integrated in the Financial Management Information System (FMIS).

It is not possible therefore to express an opinion on the accuracy of the expenditures incurred by the Ministry under each output cost.

2.

There is a significant variance in the VAT records and accounts as at 31 December 2007.
18.2 Statement of Receipts and Expenditures The Ministry of Education incurred total expenditures of $310,924,706 in 2007 compared to $320,556,649 in 2006.
Table 18.1: Statement of Receipts and Expenditures for 2007 Description RECEIPTS State Revenue Operating Revenue Total State Revenue Agency Revenue Miscellaneous Revenue Sale of Photographs Sales of Sch Farm Produce Total Agency Revenue 2007 $ 2006 $ 1,352,506 1,352,506 1,802,604 1,802,604 65,935 0 8,672 74,607 43,713 0 9,450 53,163 TOTAL REVENUE 1,427,113 1,855,767 EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Expenditures Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 202,176,456 2,629,143 681,636 1,047,534 4,469,371 64,941,020 560,427 276,505,587 200,364,860 2,288,956 719,089 1,054,396 4,220,143 81,220,496 585,889 290,453,829 1,459,480 30,080 5,043,023 6,532,583 2,542,505 61,024 3,800,809 6,404,338 Value Added Tax 27,886,536 23,698,482 TOTAL EXPENDITURES $310,924,706 $320,556,649 Ministry of Education Section 18: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 18.3 Statement of Output Costs The Statements of Output Costs consolidates the 13 outputs prescribed in the Budget Estimates.
These are detailed in Appendix 18.1.

18.4 Appropriation Statement The Ministry of Education incurred expenditures totalling $310,924,706 in 2007 against the budget of $320,678,356 resulting in a savings of $9,753,650 or 3%.
Table 18.2: Appropriation Statement for 2007 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Transfers Special Expenditure Total Operating Costs Grants & Budget Estimate $ 211,835,000 2,375,000 607,600 1,038,600 4,498,900 Changes $ 0 200 114,600 46,237 10,924 Revised Estimate $ 211,835,000 2,375,200 722,200 1,084,837 4,509,824 Actual Expenditure $ 202,176,456 2,629,143 681,636 1,047,534 4,469,371 65,605,500 (624,000) 64,981,500 64,941,020 814,700 286,775,300 (242,326) (694,365) 572,374 286,080,935 560,427 276,505,587 Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditure Value Added Tax 2,319,000 0 3,700,000 6,019,000 27,884,056 (689,627) 36,992 1,347,000 694,365 0 1,629,373 36,992 5,047,000 6,713,365 27,884,056 1,459,480 30,080 5,043,023 6,532,583 27,886,536 TOTAL EXPENDITURE $320,678,356 0 320,678,356 $310,924,706 18.5 Statement of Losses Loss of Money 1) Primary Section Carry – Over $ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Lapsed Appropriation $ 9,658,544 (253,943) 40,564 37,303 40,453 40,480 11,947 9,575,348 169,893 6,912 3,977 180,782 (2,480) $9,753,650 A cheque of $1,800 went missing from the primary section on 23/2/07 and was not detected until the call came from the school enquired about the third term grant.
Upon investigation, it was noted that the cheque was presented on 26/2/07.

2) Nasinu Secondary School The Bursar’s Office at Nasinu Secondary School was broken into on 16/11/07 and cash amounting to $3,664 was stolen.

The matter has been reported to Ministry of Finance and to Valelevu Police Station on 19/11/07.
Ministry of Education Section 18: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Loss of Assets 1) 2) 3) 4) A laptop valued at $2,052 was missing from Director Secondary Office on 26/05/07.

The Ministry of Finance has initiated surcharge action.

A laptop valued at $1,500 went missing from Technical, Vocational, Education and Training section under Makereta Draunibaka’s care on 12/5/06.
The Ministry of Finance has written to notify the officer of its intention to surcharge her.

A laptop valued at $3,500 went missing from TVET section under Veniana Kausau’s care on 12/5/06.The Ministry of Finance has initiated surcharge action.

A laptop valued at $2,200 went missing from the TVET section under the care of Mrs. Matelita Rauca.

The item went missing on 15/9/06.

A Loss Report was sent to the Ministry of Finance on 21/02/08.
18.6 Trust Account-Statement of Receipts and Payments Table 18.3: Trust Account Statement Description Opening Balance Add: Receipts Less: Payments Closing Balance AUDIT FINDINGS 2007 $ 2006 $ 2,610,458 2,954,419 37,128,403 39,738,861 49,049,006 52,003,425 38,359,998 49,392,967 1,378,863 2,610,458 18.7 Anomalies in VAT and FNPF Allocation Only ledger clerks authorized by PAO/SAO shall input transactions into the general ledger system.
Any errors or misallocations must be immediately adjusted by way of journal vouchers.1 The following anomalies were noted from the inspection of 2007 VAT and FNPF reconciliations at the Ministry: • • The total payment for VAT at the year end as per the reconciliations was $27,551,373 whereas the amount showed on the FMIS record was $27,886,536, resulting in a variance of $335,163.
The total payment for FNPF at the year end as per the summary was $15,230,489 whereas the FMIS records showed $15,179,403, thus showing a difference of $51,085.

The difference was due to FNPF payment to Project Staff at Civic Education Programme, AVT and Exam Casuals.

1 Section 16 of Ministry of Education Finance Manual 2005.
Ministry of Education Section 18: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The above indicates laxity by officers responsible for reconciliations and payments of VAT and FNPF.

Recommendation The Ministry should ensure that reconciliations between FMIS and internal records are carried out on monthly basis.
Ministrys Comments 18.8 Forgery of Bachelors Degree Certificate An employee must behave honestly and with integrity in the course of employment in the Public Service.2 The PAS (Personnel) shall provide a letter of appointment to all new salaried employees.
The letter shall include at a minimum, the following information: • • • job classification; salary scale and starting salary; and date of appointment to position.3 One Alexander Ralulu (TPF: 68200) was appointed as a secondary school teacher at Suva Grammar School with effect from 09/08/01.

In January 2002 he produced a forged certificate of Bachelors Degree in Education dated 19 December 2001.
In 2006 after 4 years of employment, the Ministry noted from the University of South Pacific that the degree was forged.

Alexander Ralulu was unlawfully employed and was wronly paid total salary of $57,255.

The officer was terminated from the service with effect from 10/03/06.

Laxity by the Ministry led to the appointment of Mr Ralulu.

Recommendations • • The Ministry should ensure that staff board members are more vigilant so that such incidents do not happen in future.
Action should be taken to recover the salaries paid.

Ministry’s Comments The recruitment of teachers at the beginning of the year involves a large number of teachers coming with a variety of qualifications.

The main problem is faced by the Secondary Section where the teachers are recruited from outside organizations such as USP where the degree qualifications are obtained rather than a government teacher training institutions.
Verifications back with USP is a time consuming task and can delay the process of appointment.

The Teacher Registration Board currently being put in place will now handle all this verification processes before registering the teachers who will then be recruited by the Ministry.

The amount overpaid is $7,515.37 and not $57,255.69 as mentioned in your report as the graduate salary was paid to Mr. Alexander Ralulu in 2005 and part of 2006 only.
2 Section 1 of PSC Code of Conduct 3 Section 4.1.1 of Mininstry of Education Finance Manual 2005.
Ministry of Education Section 18: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 18.9 Double Payments of Salary Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.4 Accounting officers shall satisfy themselves that vouchers are in order in all respects.5 A Grant in Aid teacher Navneet Shankar was paid through two different pay numbers during 2006 and 2007, that is, grant in aid number G4968 [from Grant in Aid Allocation] and EDP No: 80782 [from Temporary Civil Servant Allocation].
The officer was receiving two pays per fortnight which resulted in an overpayment of salary by $15, 074.01.

Refer Table 18.4 for details: Table 18.4: Details of Overpayment BNZ Bank Account No.

02776912 EDP 80782 Gross Pay f/n $ 678.42 Net Pay f/n $ 544.04 Amount School Remarks $ 14,056.38 1,017.63 Sila Central High School The payment was from Pay 1-26/06 and Pay 1-/07(Temporary Civil Servant Allocation).
Total $15,074.01 The overpayment indicates lack of supervision and monitoring by the responsible officers.

Recommendations • • • Appropriate disciplinary action should be taken against responsible officers.

Control measures should be put in place to avoid such occurrences.

Necessary actions should be taken to recover the overpayment.

Ministry’s Comments The salary for Grant-in-aid teachers were being prepared separately and that too by another section ie.
Secondary section whereby separate payroll was printed.

In the case that you have mentioned the teacher who was first recruited as grant-in-aid was appointed to civil service in 2006 and his file transferred to salaries for payment without ceasing the pay in the grant-in-aid payroll.

This was purely due to an oversight.

We are trying to install mechanism to ensure elimination of such occurrence in future.

We are trying to have the amount recovered.
18.10 Cartage of Personal Effects The Chief Executive officer must obtain at least 3 written competitive quotes for any procurements of goods, services or work that cost more than $100 but less than $20,000.6 4 Finance Instruction 18 5 Finance Instruction 41 6 Finance Instruction 12(1) Ministry of Education Section 18: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Finance Instruction 17 provides that goods, services and works required by agencies will be procured by issuing purchase orders for any local procurement.
It further states that a local purchase order, indent, departmental warrant, contract or agreement must be issued before goods, services and works are received.

Audit noted that in most cases cartage of personal effects only had one quotation.

The quotations were mainly from two companies namely Shaniza Nair Trucks and Vinesh Kumar who have been providing cartage services of personal effects of primary and secondary school teachers in 2007.

Refer to Table 18.5 for examples.
Table18.5: Examples of Cartage Services Date 29/01/07 30/01/07 31/01/07 13/02/07 22/02/07 17/04/07 31/05/07 09/02/07 13/02/07 08/03/07 23/03/07 01/05/07 01/06/07 01/06/07 27/12/07 PV No/ Chq No 30451 30496 30451 32158 33568 39024 41416 32022 32159 35178 37300 39857 41560 41561 61388 Payee Shaniza Nair Trucks Shaniza Nair Trucks Shaniza Nair Trucks Shaniza Nair Trucks Shaniza Nair Trucks Shaniza Nair Trucks Shaniza Nair Trucks TOTAL Vinesh Kumar Vinesh Kumar Vinesh Kumar Vinesh Kumar Vinesh Kumar Vinesh Kumar Vinesh Kumar Vinesh Kumar TOTAL Amount ($) 2,800.00 2,380.00 1,343.00 1,343.00 3,493.83 3,255.50 2,500.00 $17,115.33 1,900.00 2,380.00 3,595.50 1,261.13 3,450.00 2,400.00 2,950.00 1,530.00 $19,466.63 Local Purchase Orders were not issued in all the above transactions.
Recommendation Appropriate disciplinary action should be taken against responsible officers who failed to comply with standing policies on procurement of goods and services.

Ministry’s Comments The services were procured at the beginning of 2007.

At the time there were no contracted service providers.

There was a need to re locate teachers at the beginning of the school year.
Since LPO authority was only with the Acting PSE, transfers at the various stations were facilitated by obtaining three quotations.

Please be advised that some of our rural schools are in such remote locations, registered companies are not prepared to service these routes.

At the time many companies were not even prepared to accept LPO’s and officers may have made their own arrangements to be at the school in time.

The solution lies in identifying official service providers in each district.
COGS have now awarded a contract for an official service provider for Viti Levu.

We hope others will be identified so that we do not get into this problem.

The procedures have been followed so there is no need for action.

disciplinary Ministry of Education Section 18: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 18.
1 – Statement of Output Costs Portfolio Leadership Advice & Secretariat Support Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 21,348,986 764,459 142,586 484,753 842,263 31,549,078 220,867 55,352,993 19,969,810 657,599 160,324 475,918 805,115 33,793,110 297,689 56,159,565 0 16,715 0 16,715 0 47,711 0 47,711 Value Added Tax 3,017,515 2,507,503 TOTAL EXPENDITURE 58,387,223 58,714,779 Education & Training Childhood Education Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 663,875 83,620 17,023 30,175 116,401 2,141,929 42,130 3,095,155 721,080 70,685 18,405 28,405 120,858 2,008,621 8,468 2,976,522 0 0 99,973 99,973 0 0 98,000 98,000 Value Added Tax 119,153 108,280 TOTAL EXPENDITURE 3,314,281 3,182,802 Ministry of Education Section 18: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Education & Training Primary Schools Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 101,523,859 186,093 277,317 42,949 436,340 6,259,197 199,595 108,925,351 108,551,619 166,000 286,056 38,232 399,924 7,020,930 195,051 116,657,812 0 0 396,361 396,361 2,732 0 524,853 527,585 Value Added Tax 12,833,269 12,265,535 TOTAL EXPENDITURE
 122,154,981 129,450,932 Education & Training Secondary Schools Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 73,879,392 1,384,147 148,236 249,538 1,661,201 9,986,155 9,783 87,318,452 65,409,007 1,179,497 148,541 272,325 1,639,322 24,043,466 8,468 92,700,626 1,037,536 13,364 1,155,689 2,206,589 1,318,345 13,313 1,177,956 2,509,614 Value Added Tax 10,902,156 7,829,748 TOTAL EXPENDITURE 100,427,197 103,039,988 Ministry of Education Section 18: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Education & Training Tertiary Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 455,339 12,635 8,885 26,557 41,751 2,009,530 9,783 2,564,480 571,518 10,994 9,664 25,584 51,202 1,922,677 8,468 2,600,107 200,000 0 3,391,000 3,591,000 200,000 0 2,000,000 2,200,000 Value Added Tax 69,369 98,159 TOTAL EXPENDITURE 6,224,849 4,898,266 Provision of Library Services Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 365,038 60,836 12,260 30,544 141,051 1,541,930 9,783 2,161,442 470,504 67,238 14,542 35,254 150,105 1,472,711 8,468 2,218,822 0 0 0 0 0 0 0 0 Value Added Tax 77,439 83,468
 TOTAL EXPENDITURE 2,238,881 2,302,290 Ministry of Education Section 18: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Consulting Services Advisory Services to School Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 728,106 57,495 16,778 28,930 163,706 1,635,450 9,783 2,640,248 812,210 56,190 16,550 26,204 157,144 1,562,704 8,468 2,639,470 0 0 0 0 0 0 0 0 Value Added Tax 125,600 120,459 TOTAL EXPENDITURE 2,765,848 2,759,929 Consulting Services Student Careers Counselling Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 238,577 25,324 9,483 26,392 61,293 1,635,450 9,783 2,006,302 341,188 26,444 11,201 28,493 67,090 1,562,704 8,468 2,045,588 0 0 0 0 0 0 0 0 Value Added Tax 46,357 54,021 TOTAL EXPENDITURE 2,052,659 2,099,609 Ministry of Education Section 18: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 External Examination Services Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 581,710 18,563 15,983 26,931 724,652 1,541,930 9,783 2,919,552 706,610 20,690 16,820 25,509 568,616 1,472,711 8,468 2,819,424 0 0 0 0 0 0 0 0
 Value Added Tax 172,345 150,659 TOTAL EXPENDITURE 3,091,897 2,970,083 Education & Training Special Schools Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 1,751,819 3,713 12,894 25,877 156,066 1,921,058 9,783 3,881,210 1,925,353 4,138 13,408 24,759 119,998 1,852,739 8,468 3,948,863 0 0 0 0 0 0 0 0 Value Added Tax 413,683 234,496 TOTAL EXPENDITURE 4,294,893 4,183,359 Ministry of Education Section 18: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Primary Schools Radio Broadcasts Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 238,577 10,190 8,455 25,504 26,675 1,541,930 9,783 1,861,114 257,092 10,292 9,516 24,846 32,024 1,472,711 8,468 1,814,949 0 0 0 0 0 0 0 0 Value Added Tax 39,898 38,287 TOTAL EXPENDITURE 1,901,012 1,853,236 Secondary Schools Radio Broadcasts Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 135,956 10,190 5,317 24,386 26,104 1,541,930 9,783 1,753,666 159,634 10,292 6,376 23,825 31,092 1,472,711 8,468 1,712,398 0 0 0 0 0 0 0 0 Value Added Tax 26,467 26,814 TOTAL EXPENDITURE 1,780,133 1,739,212 Ministry of Education Section 18: Page 13
 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Education Support Description EXPENDITURE Operating Costs Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditures Total Operating Costs Capital Capital Construction Capital Purchases Capital Grants & Transfers Total Capital Expenditures Value Added Tax 2007 $ 2006 $ 265,220 11,876 6,418 24,998 71,869 1,635,450 9,783 2,025,614 469,235 8,897 7,696 25,041 77,653 1,562,701 8,468 2,159,691 221,944 0 0 221,944 1,021,429 0 0 1,021,429 43,286 181,055 TOTAL EXPENDITURE 2,290,844 3,362,175 Ministry of Education Section 18: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Section 19 Ministry of Health Programme Statement The Ministry of Health shall provide health services with the commitment that it is the right of everyone in the Republic of Fiji, irrespective of race, sex, colour, creed, financial circumstances or poverty to have a national health system which provides a high quality health service to the maximum extend possible within the available resources.
The delivery of health services is divided into two clear distinct divisions; • • the Primary Health Care Services and: the Curative (Hospital) Health Care Services.

The main objective of the Primary and Preventive Health Services is to enhance the promotion of health and well-being, protection of life and prevention of diseases, injury and substance abuse.
The main objective of the Curative (Hospital) Health Care Services is to ensure that the standardised basic diagnostic and treatment facilities for common disease problems are readily available near to where people live, are responsive to patients' needs are affordable and that they are closely integrated with community rehabilitative services to ensure continuity of patient care.

Health services are expected to change significantly over the next few years.
• Firstly, a decentralisation of the management of health services will take place under the Fiji Health Management Reform Project.

• Secondly, financing options and arrangements which may include National fees, privatisation and the revision of hospital Insurance Scheme, contractualisation.
For 2007, the Ministry continued to concentrate its efforts in human resources management and development; reorganising/ reforming of the health services; standards and quality; performance/ output based financial management system and resource allocation; Health Management Information System; health financing and cost sharing; public relations strategies and facilities development Table of Contents 19.1 19.2 19.3 19.4 19.5 FINANCIAL STATEMENT............................................................................................................................. 4 Audit Opinion....................................................................................................................... 4 Statement of Receipts and Expenditures ........................................................................... 4 Statement of Output Costs.................................................................................................. 5 Appropriation Statement ..................................................................................................... 5 Statement of Losses ........................................................................................................... 6 AUDIT FINDINGS ......................................................................................................................................... 6 HEADQUARTERS ........................................................................................................................................ 6 19.6 Wages and Salaries Reconciliation .................................................................................... 6 19.7 Overpayment of Salary ....................................................................................................... 7 Ministry of Health Section 19: Page 1 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.8 Consolidated Allowance...................................................................................................... 8 19.9 FNPF
8 19.9 FNPF Contributions........................................................................................................... 10 19.10 Study Leave with Pay – Amelia Turagabeci EDP 61322.................................................. 11 19.11 Failure to Take Disciplinary Action.................................................................................... 12 19.12 Breach of Public Service Act............................................................................................. 12 19.13 Non Compliance to Health Finance Manual ..................................................................... 14 19.14 Negligence Payments ....................................................................................................... 14 19.15 Incomplete records............................................................................................................ 15 19.16 Non Delivery of Audio Visual Equipment .......................................................................... 16 19.17 Poor Advertisement Coverage.......................................................................................... 17 19.18 Excessive Engagement of Private Printing Companies.................................................... 18 19.19 Purchase of Vehicles through St Johns ............................................................................ 19 19.20 Sea Ambulance Not Delivered.......................................................................................... 21 19.21 Hire of Private Vehicles for Cartage.................................................................................. 22 19.22 Discrepancies at the Tamavua Garage ............................................................................ 22 19.23 Negligence over Garage Items ......................................................................................... 24 19.24 Unserviceable Vehicles not boarded ................................................................................ 25 19.25 Poor Workmanship at Tamavua
 Garage .......................................................................... 26 19.26 Improper Supervision of Ministry Vehicle ......................................................................... 28 19.27 Excessive Usage of Private Garages ............................................................................... 29 19.28 Poor Monitoring of Vehicle Repairs .................................................................................. 30 19.29 Poor Workmanship at Private Garages ............................................................................ 31 19.30 Local Purchase Orders raised after Additional Repairs.................................................... 31 FIJI PHARMACEUTICAL SERVICES......................................................................................................... 32 19.31 Expired Drugs ................................................................................................................... 32 19.32 Out of Stock Drugs............................................................................................................ 33 19.33 Damaged Drugs ................................................................................................................ 34 19.34 Short Expiry of Advantage Strip........................................................................................ 35 19.35 Risky Storage Area ........................................................................................................... 35 19.36 Poor Control in Receiving Delivered Items ....................................................................... 36 CWM HOSPITAL ........................................................................................................................................ 37 19.37 Current Condition of CWM’S Ambulance.......................................................................... 37 19.38 Service Rendered Without a Written
 Agreement.............................................................. 38 19.39 Old Machine and Equipment............................................................................................. 38 LAUTOKA HOSPITAL................................................................................................................................. 40 19.40 Expired Drugs ................................................................................................................... 40 Ministry of Health Section 19: Page 2 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.41 Contract Service................................................................................................................ 41 WESTERN HEALTH SERVICES................................................................................................................ 41 19.42 Uneconomical Spending ................................................................................................... 41 19.43 Loss of Government Revenue .......................................................................................... 42 19.44 Loss of Laptops................................................................................................................. 43 NORTHERN HEALTH SERVICES ............................................................................................................. 44 19.45 Tyre Records..................................................................................................................... 44 FINAL CASH ACCOUNT ............................................................................................................................ 45 19.46 Delay in Banking ............................................................................................................... 45 19.47 Issuing of LPO after Cut of Date ....................................................................................... 46 19.48 Revenue
46 19.48 Revenue Variances........................................................................................................... 47 19.49 Ministry of Health’s State Revenue Overstated ................................................................ 48 19.50 Non Compliance with the Finance Instructions 2005........................................................ 48 19.51 Annual Report for Ministry of Health ................................................................................. 49 19.52 Failure to Submit Financial Statements before Due Date................................................. 50 19.53 Trust Fund Account – Reconciliation as at 31/12/07 ........................................................ 50 19.54 Annual Trading Account – Bulk Purchase Scheme .......................................................... 51 19.55 FNPF: Variance -2007 ...................................................................................................... 52 19.56 VAT Reconciliation............................................................................................................ 52 Appendix 19.1: Pending Surcharge Cases.................................................................................. 54 Appendix 19.2: Overpayment of Salary on Resignations ............................................................ 59 Appendix 19.3: Disciplinary Cases - No action Taken................................................................. 60 Appendix 19.4: Non Compliance with Health Finance Manual.................................................... 64 Appendix 19.5: Failure to Carry Out Specified Duties ................................................................. 68 Appendix 19.6: Summary of Payments Made To the Private Garages: 2005 To 2007............... 68 Appendix 19.7: Repetition of Repairs on Ministry Vehicles ......................................................... 69 Appendix 19.8: Issues of LPOs for Additional Repair Works....................................................... 70 Appendix
70 Appendix 19.9: Items Out of Stock as at 31/12/07 ...................................................................... 71 Appendix 19.10: Meal Claims and Overtime Paid to Health Inspectors by the Ministry................ 73 Ministry of Health Section 19: Page 3 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 FINANCIAL STATEMENT 19.1 Audit Opinion The audit of the Ministry of Health accounts for the year ended 31/12/07 resulted in the issue of a qualified audit report.
The qualifications are as follows.

a) The Ministry of Health has grouped its expenditures into 9 Statement of Output Costs, whereas the Budget Estimates 2007 prescribes 10 outputs.

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

a Profit and Loss Statement for trading operation of the Bulk Purchase Scheme; (ii).

a Trust Account Statement of Receipts and Payments.
The Finance Management Information Systems shows a sum of $7,481,525 in the Operating Trust Account as at 31 December 2007 of which $6,828,218 or 91% represents FNPF contributions.

The Ministry has not provided explanations for the significant balance in the Trust Fund Account; (iii).

A Statement of Losses 19.2 Statement of Receipts and Expenditures The Ministry of Health incurred total expenditures of $150,797,123 in 2007 compared to $144,736,816 in 2006.
TABLE 19.1: STATEMENT OF RECEIPTS AND EXPENDITURE IN 2007 Description RECEIPTS Operating Agency Revenue TMA 2007 $ 2006 $ 200,230 1,406,195 61,475 1,141,128 1,560,188 54,064 TOTAL REVENUE 1,667,900 2,755,380 EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures 66,724,973 71,202,452 14,178,652 16,151,814 3,142,437 2,743,802 8,952,646 8,416,907 22,606,097 22,270,507 4,262,236 4,606,831 1,877,657 1,996,359 127,388,672 121,744,698 Ministry of Health Section 19: Page 4 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Description Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 3,413,882 2,070,627 - 5,484,509 2,901,916 2,635,744 1,000,000 6,537,660 Value Added Tax 17,923,942 16,454,458 TOTAL EXPENDITURES 150,797,123 144,736,816 19.3 Statement of Output Costs The Ministry of Health has grouped its expenditures into 9 Statement of Output Costs, whereas the Budget Estimates 2007 prescribes 10 outputs.
These are detailed in Appendix 19.1.

19.4 Appropriation Statement The Ministry of Health incurred expenditures totalling $150,797,123 in 2007 against the budget of $150,808,447 resulting in a savings of $11,324.
TABLE 19.2: APPROPRIATION STATEMENT FOR 2007 – HEAD 19 SEG Item Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special Expenditure Total Operating Costs Capital Expenditure Capital Construction Capital Purchases Capital Grants and Transfers Total Capital Expenditure Budget Estimate $ 69,438,420 14,224,110 2,595,060 6,661,000 25,199,365 4,728,200 2,103,926 124,950,081 Changes $ --- --- --- --- 23,889 --- --- 23,889 Revised Estimate $ 69,438,420 14,224,110 2,595,060 6,661,000 25,223,254 4,728,200 2,103,926 124,973,970 Actual Expenditure $ 71,202,452 16,151,814 2,743,802 8,416,907 22,270,507 4,606,831 1,996,359 127,388,672 Carry – Over $ --- --- --- --- --- --- --- --- 6,843,866 2,650,000 150,000 9,643,866 (23,889) --- --- (23,889) 6,819,977 2,650,000 150,000 9,619,977 3,413,882 2,070,627 --- 5,484,509 13 Value Added Tax 16,214,500 TOTAL EXPENDITURE 150,808,447 --- 0 16,214,500 17,923,942 150,808,447 150,797,123 Lapsed Appropriation $ (1,764,032) (1,927,704) (148,742) (1,755,907) 2,952,747 121,369 107,567 (2,414,702) 3,406,095 579,373 150,000 4,135,468 (1,709,442) 11,324 --- --- --- --- --- --- Ministry of Health Section 19: Page 5 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Ministry of Finance approved a transfer of $23,889 from SEG 8 construction to SEG 5 Purchase of goods and services during the year because of foreseen over expenditures.
19.5 Statement of Losses Ministry of Health failed to prepare the Statement of Losses in accordance with Finance Instructions 82.
AUDIT FINDINGS HEADQUARTERS 19.6 Wages and Salaries Reconciliation The Accounting Head must ensure that payroll reconciliations are carried out fortnightly for salaries and weekly for wages and copies sent to the Ministry of Finance1 Salaries and wages reconciliation should be prepared on a regular basis in order to detect and take appropriate actions on fraud/error immediately otherwise the recovery may not be possible if the officers resign or retire from the service.
The Ministry’s payroll budget for 2007 is $83.7 million (SEG 1-2) which represented 55% of the entire Ministry’s budget of $150.8 million.

It also has a large establishment of 3,313 (established) and 1,532 (unestablished).

The following stations did not submit wages reconciliations for 2007 to Health Headquarters on time.
Refer to Table 19.3 below for examples: TABLE 19.3: WAGES RECONCILIATIONS SUBMITTED BY STATIONS Station Comments CWM Hospital Lautoka Hospital Labasa Hospital Levuka Hospital Tamavua Hospital Navua Hospital Rotuma Hospital Tamavua Hospital Old People’s Home – Samabula St. Giles Virus Lab FSN SDMO Rewa Serua Namosi SD Kadavu Vunidawa - SDMO Tailevu SD No submissions No submissions No submissions No submissions Reconciliation for pays 36-52 not submitted Reconciliation for pays 37-52 not submitted Reconciliation for pays 45-52 not submitted No submissions Reconciliation for pays 45-52 not submitted Reconciliation for pays 48-52 not submitted No submissions No submissions Reconciliation for pays 47-52 not submitted Reconciliation for pays 46-52 not submitted Reconciliation for pays 48-52 not submitted Reconciliation for pays 35-52 not submitted Reconciliation for pays 20-52 not submitted 1 Finance Instructions 2005, Section 26 (7) Ministry of Health Section 19: Page 6 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The wages clerk at Headquarters also failed to keep track of the reconciliations received from each station.
Reconciliations were piled in a box located at the voucher room.

The absence of regular salaries and wages reconciliation may result in undetected errors, fraud and salary overpayments, to name a few.

Recommendations • The Ministry should carry out all salaries and wages reconciliations in accordance with Finance Instruction 26(7).

• Disciplinary action should be taken against the Officer(s) responsible for the delay in preparation of the salary reconciliations.
Management Comments Turnover of staff has affected the salary reconciliation which was delayed from 2006.

It is quite a mammoth task as pending reconciliations was for (4) Cola payments awarded to civil servants in 2006.

The only possible way to update these reconciliation was to work overtime in which a request was endorsed by the Permanent Secretary for Health and forward to the Public Service Commission for approval and payment was processed.
We have assigned a clerk to carryout salary reconciliation and Pay 14/08 is completed.

Finance Instruction 26(7) is noted and future salary reconciliation will be completed within the year.

To discipline the present officer would be unfair as the previous officer, a permanent staff, who was involved in the salary reconciliation got transferred to another unit and it took a while to have a replacement, hence this delay.
The TRCO was given the work which requires time for adjustment to the reconciliation procedures.

Wages reconciliations are being carried, the clerk in the Sub Divisions have been informed to send it over to HQ.

We are following this report with Accounts Officer in the Divisions and officers fail to adhere to set procedures will be disciplined.

The Wages clerk HQ will monitor this report every week.
We have sent a Circular to all the Divisions and Major Hospitals in regards to all the Accounting reports that should be submitted to this office at every interval (weekly/monthly/quarterly).

Further OAG Comments Audit found on 21/07/08 that a number of stations have failed to carry out proper wages reconciliation.
19.7 Overpayment of Salary An officer, who has resigned, deemed to have resigned or terminated shall forfeit all the rights and privileges of his office from the date decided by the Commission.2 An officer who resigns without giving 30 consecutive days notice may be required to pay 30 days salary in lieu of notice..3 2 General Orders 222(d) Ministry of Health Section 19: Page 7 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 A total of $42,899 as of 31/12/07 was recorded as overpayment of salary by the Ministry of which $26,561 (62%) was overpayment upon resignation.
This is a result divisional officers failing to advise salaries section at Head quarters on time.

Refer to Appendix 19.2 for examples: Laxity by the station officials has resulted in the overpayments.

Recommendations • Disciplinary action should be taken against officers responsible for the overpayment.
• The Ministry should implement an effective and efficient communication process between the various hospitals, stations, centres with Headquarters so that all correspondences relating to retirements, resignations, terminations are processed in a timely manner to avoid overpayments.

• Concerted effort should be made to recover the overpayments.
Management Comments This issue continues to occur due to laxity in communicating appropriate information/correspondence to this office on time for cessation of payment.

In most cases it is delayed from various stations in the Divisions.

A joint meeting with our staff in April this year and channel of communication were observed in the relaying of information/ correspondence to effect immediate action in case of cessation of salary payment due to retirement, resignation, etc.
Disciplinary action will be instituted against those officers responsible for overpayment.

We have identified a clerk to assume additional responsibility of monitoring the progress on recovery and update the heads of Departments on action taken.

We have seen a lot of improvement recently and our staffs are made aware of this issue and the consequence that they will face if they fail to adhere to the Finance Manual.
Further OAG Comments Audit noted that overpayment of salary had not improved and as at July 2008 the balance was $54,053.

19.8 Consolidated Allowance Consolidated allowances are paid to nurses based at nursing stations, rural areas and not in health centres or urban hospitals.

It is normally paid to District Nurses in their area of operation where there is no Medical Officer employed either in the Nursing Station or in Health Centres.
Some nurses were still paid consolidated allowances despite working in urban hospitals and health centers.

Refer below for examples: TABLE 19.4: PAYMENT OF CONSOLIDATED ALLOWANCE 3 General Orders 222(a) Ministry of Health Section 19: Page 8 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Allowance per Pay 65.80 Allowance Paid (Till Pay 06/08) 7,238.00 59.20 3,433.60 Station EDP # 32478 CWM Hospital 33235 Natewa Health Centre Remarks - Was transferred to CWM on 02/01/04.
- Supervisor in charge failed to inform salaries department to cease consolidated allowance.

- Nurse, to-date is still being paid such allowances identified above.

- Was transferred from Tawake Nursing Station on 29/12/05.

- Memo received from Northern Health Service on 24/04/07; informing Salaries Department to cease payment of consolidated allowance to her.

- Hence to 24/04/07, the officer was paid consolidated even though she was not entitled to receiving it.
from 29/12/05 allowance Total $10,671.60 Station supervisors failed to inform salaries section about nurse transfers so that payments of consolidated allowances could be ceased.

Public funds are wasted as a result of these payments.

Salary clerks have to spend unnecessary time to rectify the problem and make recoveries.

Recommendations • The supervisor in charge and/or the Personnel Section of the Ministry should inform the Salaries Section immediately upon the transfer of the nurses concerned.
• Payment of consolidated allowance to nurses at urban hospitals and health centers should cease immediately.

• Recoveries should be made from the nurse’s salaries immediately.

Management Comments We only cease and commence payment upon receipt of notification letter from the stations and overpayment are mainly due to delay in this process.
The GMCH in the Divisions and Sub-Divisional Medical Officers and Health Sisters will again be informed as discussed today, 4/6/08 with our Accounts and Personnel Unit.

The salary clerks had again verified the payrolls to ensure consolidated allowance are only paid to the nurses serving in the rural areas.
We have ceased payment of consolidated allowance to the nurses highlighted in the report and recovery will commence in Pay 13/08 Figures stated in your report need to be verified before the input are raised for pay 13/08.

Your observation is noted and will adhered in future Further OAG Comments Audit checked the payroll system and found that no recovery has been made so far as at 17/7/08.
Ministry of Health Section 19: Page 9 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.9 FNPF Contributions It is the responsibility of every department to ensure that every employee, as defined under the Fiji National Provident Fund Act, is registered and his/her membership number is entered on the prescribed form.
Chief Accounting Officers, as employers under the Act, are required to pay to the FNPF in respect of their employees’ contributions, calculated upon the amount of wages or salaries paid to such employees for the preceding month, at the rate of sixteen cents for each complete dollar.4 Audit noted that as at 31/12/07, a total of $47,304 which was the FNPF contribution for both established and unestablished workers, was posted to a Suspense Account due to the following anomalies.
• The registration forms for unestablished relievers and temporary project officers were not received from their respective stations by the FNPF Clerk at the headquarters because it was incomplete or was not filled.

• The FNPF Clerk was not informed until the officer received the copy of the manual voucher at the end of the month from the cashier.

• Some members do not inform the station clerks of their FNPF numbers if they were previously employed.
• Sometimes differences arise in the records of the Ministry of Health and the FNPF.

For example, female officers after getting married change their surnames but the FNPF was not informed about the changes.

• Some officers use nick names instead of names in the birth certificates.
In such financial dealings, omissions in the contribution of FNPF would normally penalize the account holder who loses out on current and compound interests due to the balance of each account calculated at the end of 12 months, and any discrepancies occurred during the interim period could have gone unnoticed.

The Ministry did not follow proper procedures and can be penalised by FNPF under the circumstances.
Employee’s contributions to FNPF also forgo any interest when their contributions are held in the suspense account.

Recommendations • The transactions in the suspense account should be investigated and appropriate actions taken to clear them and paid to the Fund.

• Regular reconciliation needs to be carried out to ensure that these balances are cleared on time.

• FNPF registration forms should be completed before the commencement of any employment with the Ministry.
• Clerks from respective stations should be disciplined for not carrying out their duties to expectations.

4 Finance Instructions 81 (1) (2) Ministry of Health Section 19: Page 10 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments The above issue had been discussed with the responsible officers in the Divisions and we have also sent out reminders through circulars to all the stations.
In late 2007 we have informed the Divisions that payment will only be processed if the workers have their permanent FNPF No.

In 2007 FNPF report and other relevant information was sent out to the stations to identify and inform the workers in appropriating correct names and FNPF numbers.

Through verification of records early this year, 2008, we managed to clear about $70k with the Fund.

The FNPF clerk has given extra effort to carry out reconciliation of this account and it has proved fruitful.
Disciplinary action will be instituted if responsible officer failing to comply with the set procedures.

Further OAG Comments Audit noted that there was no improvement in the FNPF suspense account and the amount outstanding as at July 2008 was $128,032.
19.10 Study Leave with Pay – Amelia Turagabeci EDP 61322 All officers wishing to leave Fiji for reasons other than official duties are required under Regulation 36(k) of the PSC (Constitution) Regulations 1990 to obtain the prior written approval of the Secretary of the Public Service.5 It is the responsibility of the immediate supervisor or divisional officer to report on officers’ absenteeism.
A Senior Assistant Health Inspector, Amelia Turagabeci (EDP 61322) had requested for study leave with pay for a period of 4 years effective from 2003 to 2007.

However, the National Training Committee at its meeting held on 14/8/03 had granted “Study Leave without Pay” to the officer The officer however went to study at her own accord without obtaining authority for study leave overseas from the Ministry and PSC.

She also continued to receive full salary for the period of 4 years.
A total of $65,555.86 was paid to her as follows: TABLE 19.5: TOTAL SALARY PAID TO AMELIA Pay Period October – December 2003 Year 2004 Year 2005 Year 2006 Jan – October 2007 Total Amount Paid (Gross Pay) $ 4,210.65 15,547.68 15,525.59 17,893.02 12,378.92 65,555.86 The salary section was not informed about the unauthorized absence as a result salary totaling $65,555.86 was overpaid.
The decision by the Disciplinary Committee to recover the above sum also remains doubtful as the officer has resigned from the service with effect from 26/02/08.

5 General Orders 729 (a) Ministry of Health Section 19: Page 11 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Recommendations • The responsible officer should be surcharged for failing to report on the officer’s unauthorized leave.

• Every effort should be utilized to recover the salary overpaid.
Management Comments The disciplinary committee will decide on the recommendation to surcharge and discipline the supervisor.

Amelia Turagabeci has deemed to have resigned.

This case is with the disciplinary committee for their decision.

Further OAG Comments Audit noted that no action has been instigated so far as to recover the overpayment and neither the surcharge of the supervisor.
19.11 Failure to Take Disciplinary Action In 2006, audit had reported a number of cases where Ministry staffs were implicated in wrongful doings.

To date, audit has found that the cases had not been investigated or disciplinary actions taken.

Some of the staffs implicated had left the Ministry.

The Ministry had not taken disciplinary and surcharge actions despite a commitment made following the discussion of the 2006 audit report.

Refer to the Appendix 19.3 for examples.


Recommendations • The Ministry should investigate the cases highlighted by audit and take appropriate actions against the officers implicated.

• The senior officers who failed to instigate disciplinary actions highlighted by audit should also be disciplined.

Management Comments The recommendations are noted and necessary action will be taken against those highlighted in the report by the disciplinary committee.
19.12 Breach of Public Service Act An employee must use Government resources and assets in a proper way.6 An employee must not make improper use of official information or of the employee's duties, status, power or authority in order to gain 6 Public Service Act -1999, Section 8 Ministry of Health Section 19: Page 12 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 or seek to gain, a benefit or advantage for the employee or for anyone else.7 An employee must behave honestly and with integrity in the course of employment in the public service.8 Audit noted that Peni Vulaca, a mechanic at the Ministry had breached many of the PSC Service Act clauses but no action was taken against him.
Refer the following examples: • On 21/11/06 he carried out repairs on ED999 at the Tamavua garage during working hours as confirmed by the mechanics at the garage.

The vehicle is owned by Josefa Serevi Bolaqace, a Project Officer at the CWMH National Blood Bank.

• Mr. Vulaca took a chain block, a gas wielding plant, panel beating tools, an arch wielding plant & a sanding machine to carry out this private work outside the garage area whilst he was on annual leave on 8/1/07.
Also while on leave on 31/1/07, he took the arch wielding plant for his private use.

• On many occasions he was missing from the garage without any genuine reason and there have been numerous complaints of this from the transport officer and the mechanics at the garage.

All efforts by the audit to discuss the issues were in vain as Mr. Vulaca was not always present.

• He was driving government vehicles without a valid driving licence for over 10 months.
Audit checked with the Land Transport Authority on 20/3/08 and noted that his licence had expired on 12/5/07.

• The Ministry had purchased a vehicle EM 866 for $31,000 after which Mr. Peni Vulaca took it to attend a breakdown in Namosi.

Whilst returning he had an accident at Nabukavesi and was charged for careless driving.

• He had lied whilst filling the government vehicle accident report form indicating that his driving license was valid, when it was not.
• He was found to be frequently writing on his time card instead of using the punching machine/time clock.

The failure of the Ministry to have this officer disciplined raised serious doubts on its disciplinary mechanism and that the possibility of favoritism cannot be ruled out.

This has also resulted in the continuous misuse and/or abuse of Government resources and assets.

Recommendation The Ministry should discipline the officer and report the matter to PSC for breach of PSC Service Act.
Management Comments Mr. Peni Vulaca's case as mentioned earlier is dealt with by the MoH Disciplinary Committee.

Mr. Vulaca has been issued a letter to explain the allegations as highlighted in your report.
The Committee will then consider taking 7 Public Service Act-1999, Section 10 8 Public Service Act 1999, Part 2, Section 1 Ministry of Health Section 19: Page 13 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 appropriate disciplinary action against him depending on the outcome of his response.

This will be conveyed to you when it's finalized.

Further OAG Comments No action has been taken so far, after this was verified on 17/7/08.
19.13 Non Compliance to Health Finance Manual Section 28 of the Financial Management Act 2004 states that, the Chief Executive Officers of the Ministries are to issue Finance Manual for their respective agencies.

This Finance Manual sets out policies and procedures needed for the efficient and effective management of the agency and effective operation of internal controls.
All officers within the Ministry of Health are required to comply with the Manual.9 The examination of various accounting records revealed that the Finance Manual was not fully complied with and that the Senior Section Heads failed to rectify these.

Refer to Appendix 19.4 for more details.

The Ministry had also failed to comply with the Finance Manual as highlighted in the previous year’s audit report.
Non adherence to the Finance Manual compromises the internal controls and efficient and effective management of the Ministry.

Recommendation The Ministry should discipline all officers who failed to comply with the Finance Manual and ensure that in future, all instructions in Manual are adhered to.

Management Comment We are observing and adhering to the Finance Manual to ensure effective operation of internal controls.
19.14 Negligence Payments The Office of the Solicitor General was responsible to meet all payments arising out of claims against the state for negligent practices by Civil Servants until the end of 1997.

Since 1998, the Ministry pays litigation cost for negligence payment due to medical negligence caused by Medical Officers.

The examination of negligence payment records revealed the following anomalies.

Public funds totalling $1,623,657 have been paid between 2002 and 2007 as negligence payments.
This money could have been used for other urgent purchases had the officers of the Ministry taken more care in the conduct of their work.
Refer to the Table 19.6 below for details: 9 Ministry of Health-Finance Manual- Section 1.1 Ministry of Health Section 19: Page 14 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 TABLE 19.6: NEGLIGENCE PAYMENT Year 2002 2003 2004 2005 2006 2007 Total Negligence Practice Claims $ 20,000 305,226 100,928 146,670 407,834 642,999 1,623,657 While there is a code of conduct for Medical Officers in the service, it is evident that this is not strictly followed.
Non professional doctors conduct operation especially on circumcision.

Innocent people become victims of negligence and as a result court cases are filed and negligence payments are made.

The Ministry has no guidelines and procedures to deal with complaints from the public.

While some complaints were investigated, most were filed away without the complainant being informed of the outcome of the investigation.

Disciplinary actions are hardly taken against those implicated for acts of negligence.
Consequently complainants are left with the option of seeking legal advice and civil cases are filed against the State, which in a number of cases, had favored the injured parties.

Recommendations • To safeguard public funds from waste and extravagance, the Ministry must urgently address the issue of unprofessional conduct of Medical Officers and other support staff.

• Doctors implicated should be referred to Fiji Medical Council or PSC for disciplinary actions.
• Proper guidelines should be established to safeguard the image of the hospital services in the country.

Management Comments We are reviewing all litigation cases and are in the process of putting policy documents / guideline with the view to surcharge at the same time we are undertaking the review of medical and dental practitioners to regularize annual registration for clinician.
19.15 Incomplete records Within 1 week of the end of each month, the Accounting Head shall submit to the Deputy CEO the internal control report which provides the following information; i. ii.

whether all reconciliations are up to date; whether financial information required by the Ministry of Finance has been submitted on time; iii.
whether stock takes of physical assets, inventory and money have been carried out as and when required; Ministry of Health Section 19: Page 15 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 iv.
v. the status of unresolved audit issues; Improvements in internal control, such as rotation of duties between staff, those have been implemented or are proposed.10 Accounting records and reconciliations have not been updated or regularly maintained in accordance with Health Finance Manual.

The incomplete records are highlighted in Appendix 19.5.

As a consequence, the risk of misstatements is considered to be very high and that audit was hindered to a large extent.
The competence of accounting personnel is also questionable.

Recommendation The officers who failed to carry out their responsibilities as required under section 17.1.5 of the Health Finance Manual should be disciplined accordingly.

Furthermore, the accounts section should be thoroughly scrutinized in terms of the provision of accurate, timely and reliable data to enable prudent decision making by management.

Management Comment The concerns and issues raised herein have been noted.
Due to very frequent changes in staff of Assistant Accountant the underline reconciliation were not up to date.

However, we have slowly done a catch up and cleared the backlog on all reconciliations.
The current status is as follows:- RFA Misc up till February 2008 up till May 2008 Trust Fund Recon IDC Reconciliation up till April 2008 up till June 2008 Imprest Recon up till June 2008 Drawings The other responsible officers have been reminded on the policies and procedures criteria of the Health Manual and for them to comply.

Relevant registers and reports are now being maintained.
19.16 Non Delivery of Audio Visual Equipment If the quantity of the goods received is less than the quantity shown in the supplier’s invoice or delivery note, the receiving officer shall furnish a report to the Administration Manager who shall arrange a claim against the supplier or carrier.
All claims on suppliers or carriers should be made within three days of the goods being received.11 The National Centre for Health Promotion had purchased an Audio Visual Equipment worth $27,186, paid through a cheque number 110690 on 28/11/06.

Refer to the Table 19.7 below for details: TABLE 19.7: DETAILS OF AUDIO VISUAL EQUIPMENT 10 Health Finance Manual section 17.1.5 11 Health Finance Manual-Section 2.5.5-2.5.6.
Ministry of Health Section 19: Page 16 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Item Video Production Computer 1 Mac Pro (3G, HDD= 2TB, Memory=4GB) with Apple care protection plan.
Video Production Display 2x Apple Cinema Display (23” Flat Panel,1 Unit cost F3,477.00) System Backup 1x US 1.2 KVA Tower Total Price $ 19,737 6,954 495 27,186 However, audit noted that the Video Production Computer and Systems Backup had not been delivered by the Supplier, ITEC Computer Solutions.

The audit noted that on 23/11/06, a Clerical Officer Maraia Tuicakau, had endorsed LPO, 663634 certifying that the items have been received.
Recommendations • Management should conduct an internal investigation and take disciplinary/surcharge action against all officers involved.

• The Ministry should take every effort to recover the items not delivered by the supplier.

• If necessary, the matter should be reported to police.

Management Comments The register for the use of the TCEU audio visual and technical equipments has been created whereby officers signed out equipments whilst in use and sign on upon return.
Further OAG Comments Audit verified with the clerical officer Maraia Tuicakau, on 16/07/08 that items identified as missing have not been received as yet and no officer has been charged.

19.17 Poor Advertisement Coverage Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.
A sum of $81,063 was spent on advertising in the Turaga and Marama magazines; refer to the table below for details.

However, the following anomalies were noted about the advertisement: • The National Centre for Health Promotion, social marketing officer Mr. Saula Volavola had rejected the proposal to advertise in the magazine as the circulation was limited to around 5,000 in 2006.
• The price of a magazine was $3.95 and many people could not afford to buy the magazine and thus again there was poor coverage for the advertisement.
Refer to the Table 19.8 below for details: Ministry of Health Section 19: Page 17 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 TABLE 19.8: AMOUNT PAID TO ADVERTISED IN THE TURAGA AND MARAMA MAGAZINE Year 2006 2007 2008 Total Amount $ 27,000 37,125 16,938 81,063 Despite the decision to reject the advertisement, a total of $81,063 was incurred through advertisement with the magazine.

This is uneconomical and a waste of public funds.


Recommendation The Ministry should cease advertisement in the magazine and utilize other media outlets which have a wider coverage.
Management Comment Your observation is noted and we have stopped this from 2008 19.18 Excessive Engagement of Private Printing Companies A quote for Government supplies and government printer is required when procuring common use goods such as the standard stores and for printing of books brochures, newsletters and other printed material capable of being supplied by government printing.
The Ministry engaged private printing companies instead of the Government Printing and Stationery Department (GPSD) to undertake its printing works.

There was also little control over the printing materials which were seen lying around in many of the hospitals and health centers and offices.

Refer to the Table 19.9 below for details on some of the private printing companies engaged by the Ministry.
TABLE 19.9: DETAILS OF MAJOR PRINTING COMPANIES Company Name Period Best Print Supplies Bluebird Printery Classic Printery Davui Printery Digital Print Fiji Limited Kingdom Print Limited Mags Printing Press Makoi Instant Print Max Marketing & Publishing Ltd Pacific Printery Limited Professional Printers Ltd Utell Prints (Fiji) Ltd February 2006 to March 2008 June 2003 to February 2008 June 2003 to December 2007 July 2003 to March 2008 May 2003 to November 2008 January 2005 to August 2007 May 2003 to March 2008 May 2006 to February 2007 February 2004 to December 2007 June 2003 to January 2008 February 2006 to December 2007 August 2003 to November 2006 Amount $ 29,143.41 224,961.75 41,658.77 58,080.00 2,590.00 40,807.00 52,522.80 13,285.00 64,310.00 131,883.75 51,572.00 21,745.00 Ministry of Health Section 19: Page 18 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Company Name Period Quality print limited Print House Limited Walmarc Graphics Star Printery Viti Office Stationery Supplies Total August 2003 to February 2008 February 2005 to April 2007 March 2006 to November 2007 May 2003 to March 2008 August 2003 to February 2008 Amount $ 91,014.00 25,050.00 102,928.00 179,620.00 153,136.00 1,284,307.48 The Ministry did not consult GPSD for its printing works, and as a consequence it could not be established that the above services were obtained from the most economical source.
Recommendations • The Ministry should ensure that the GPSD is considered when obtaining quotations for jobs.

• The Ministry should exercise proper control over the printing of documents to avoid wastage and reduce engagement of private printing companies.

Management Comment Previously it may have happened that Government Printing was not given to quote but now every stationery printing, Government Printer is given an opportunity to quote for the printing.
When these printing quotes are evaluated Government Printer do gets certain printing jobs if they are cheap or otherwise.
19.19 Purchase of Vehicles through St Johns Under a Memorandum of Understanding between St Johns Ambulance and the Ministry of Health, the St Johns Ambulance assists the Ministry of Health in the procurement and delivery of ambulance vehicles for use in sub divisional hospitals and identified health centres.12 The Ministry of Finance is responsible for the purchase of all government vehicles.
The Ministry purchased three vehicles in 2007 from St Johns Ambulance and the following of irregularities were noted from the purchase: • The Memorandum of Understanding was for the purchase of ambulances but the Ministry had purchased vehicles instead of the ambulances.
• The approval for the purchase of the vehicles had come from the Permanent Secretary, where in a letter to the Senior Manager Finance, he had quoted “ambulance/vehicles”, thus two words instead of the one word in the Memorandum of Understanding “ambulance vehicles”.

• The vehicles purchased from St. Johns Ambulance were used vehicles and had previous owners in Fiji.

A confirmation from Asco Motors indicated that the Ministry could have bought new vehicles instead.
Refer to the Table 19.10 below for details.

12 Clause 4.4.1 Memorandum of Understanding Between Ministry of Health and St John Ambulance Ministry of Health Section 19: Page 19 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 TABLE 19.10: DETAILS OF THE 3 VEHICLES PURCHASED FROM ST. JOHNS AMBULANCE Date Cheque # Vehicle No.
Vehicle Description Amount $ 11/12/07 143415 EM866 16/11/07 222339 GN648 15/11/07 222341 DM503 Toyota Hilux Twin Cab Year 2004 Toyota Hilux Year 2005 Toyota Prado Year 1999 Price/year quoted of New Vehicle by Asco Motors $ 36,000.00/year 2007-8 31,000.00 35,000.00 36,000.00/year 2007-8 24,000.00 55,900.00/year 2007-8 • The Ministry of Finance had been by-passed in the purchase of the vehicles.

• One of the vehicles purchased EM866 had an accident on the day it was brought to the Ministry.
The vehicle is currently at the Tamavua Garage and audit inspection of the vehicles had evidence that it had an accident, and was being repaired.

Refer to the picture below for details.

EM866 parked inside the Tamavua Garage Close-up view of EM866, bona-fill is evident.

Bona-fill is used when a vehicle has an accident The Ministry of Finance was not consulted in the purchase of the vehicles and the transaction is considered as uneconomical and unauthorized.
Recommendations • Ministry of Finance should be involved in the purchases of all Ministry vehicles.

• The Ministry should conduct an investigation of the incident and take disciplinary actions against all officers responsible for authorizing the purchase of the vehicles.

Management Comments Your observation is noted and adhered to it.

We have sought MoF approval in 2008 purchase of vehicles Special Investigation is before the Disciplinary Committee.
Further OAG Comments Audit checked with Mrs. Brown, secretary of the disciplinary committee and she commented that she was not aware of any investigation has commenced.
Ministry of Health Section 19: Page 20 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.20 Sea Ambulance Not Delivered If the quantity of the goods received is less than the quantity shown in the supplier’s invoice or delivery note, the receiving officer shall furnish a report to the Administration Manager who shall arrange a claim against the supplier or carrier.
All claims on suppliers or carriers should be made within three days of the goods being received.13 Under the Memorandum of Understanding between St Johns Ambulance and Ministry of Health, St Johns Ambulance assists the Ministry of Health in the procurement and delivery of ambulance vehicles for use in sub divisional hospitals and identified health Centers.14 Two boats and an engine were purchased through St. Johns Ambulance as follows: TABLE 19.11: DETAILS OF ITEMS PURCHASED FROM ST. JOHNS AMBULANCE Item Sea Ambulance for Soso Nursing Station Sea Ambulance for Naqara Nursing Station Engine for Vunisea Hospital Total Price $ 14,375 14,375 8,950 37,700 In a letter to Ministry of Finance dated 30/11/07, Mrs. Sauroutu, the Senior Manager Finance had requested for approval of issuing a Purchase Order to ASCO Motors for the purchase of the 2 boats and the engine for Sub Divisional Medical Office (SDMO) Kadavu.
However on 14/12/07 a sum of $37,700 was paid through cheque number 143418 to the St John Ambulance for the supply of the items.

Confirmation at the time of audit with SDMO Kadavu indicated that the items have not been delivered to Vunisea.

While ASCO Motors was the supplier for the items it could not be established why funds were diverted to St Johns Ambulance for the purchase of the items.
Records pertaining to the purchase of the items were also not provided for audit as these were taken by the General Secretary who had resigned.

Recommendations • The Ministry should cease all procurements through St. Johns.

• The Ministry should conduct an investigation of the incident and take disciplinary actions against all officers responsible for authorizing and certifying the payments.

Management Comments Your observation is noted and adhered to it.
Furthermore, the two boats were delivered at a later date.

Further OAG Comments Audit noted that an outboard motor engine had fallen in the water but to date no officer has been surcharged for the loss, the two boats have been received at the respective stations.

Furthermore, 13 Health Finance Manual-Section 2.5.5-2.5.6.
14 Clause 4.4.1 Memorandum of Understanding Between Ministry of Health and St John Ambulance Ministry of Health Section 19: Page 21 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 audit was notified by Ministry of Health that Mr. Wadali who was responsible for the lost engine had resigned and left the service without the Ministry’s approval.
19.21 Hire of Private Vehicles for Cartage Ministries and Departments must ensure that as much as possible the hiring of private vehicles must be kept at a minimum.

Audit noted that the Ministry had hired vehicles from Ricky’s Investment for cartage of personal effects in the Central/Eastern Division for $5,875 when it had vehicles that could be used for such purposes.

Refer to the Table 19.12 for details.

TABLE 19.12: DETAILS OF THE VEHICLES AVAILABLE AT THE MINISTRY Station Vehicle No.
Size Govt Pharmacy DMO/ Cent/East Govt Pharmacy Govt Pharmacy GM293 GN074 GN161 GN162 5 Ton Hino Truck 3 Ton Truck 3 Ton Nissan Truck 7 Ton Nissan Truck Private vehicles were used over that of the Ministry’s resulting in uneconomical use of government resources.

Recommendation The Ministry should ensure that resources available are utilized and all means taken to save public funds.
Management Comment The recommendation to use our own vehicles for cartage purposes is noted and ministry will make full effort to use our own vehicles.

Further OAG Comments Audit checks revealed that as at 17/07/08, the Ministry has continued to hire private vehicles for carting of materials, rubbish and diesel.

19.22 Discrepancies at the Tamavua Garage The Ministry’s Garage was reopened in January 2005 after being left unused for the past 4 years.
Ministry of Health Section 19: Page 22 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 It was decided by the Chief Executive Officer that the work at the Garage would involve all levels of vehicle servicing, minor mechanical and electrical works and that panel beating/body work will be developed over the New Year (2006).15 The following anomalies were noted from the operation of the garage.
• An auto electrician and a panel beater were not recruited since opening in 2005 and after the issue was raised in the audit report of 2006.

• The mechanics appointed by the Ministry have basic level of motor vehicle mechanic completing only Class 3 of tradesman testing at TPAF and over the 3 years of operation no other higher qualified mechanic had been employed at the Garage.

• Many of the tools and machines were not working and not repaired despite being highlighted in the 2006 audit report.
• Many of the tools and equipments purchased by the Ministry for the Garage checked by audit in March, 2008 were missing.

• Almost all Ministry vehicles in the central/eastern division were repaired at the private garages which in 3 years accumulated costs totaling $1,119,389.

• The Ministry has failed to take actions on the head mechanic, in-charge of the Tamavua garage even after complaints had been lodged against him.
The Tamavua Garage was poorly managed and much needed resources were wasted in its operation.

Recommendations • The Ministry should assign a full time supervisor for the Garage and put in place stringent controls to monitor the work of the mechanics and the safeguarding of the tools and equipment at the Garage.

• The Ministry should contemplate employing panel beaters and more qualified mechanics to improve the quality and quantity of work at the Garage.
• The Ministry tools and equipments purchased for the Garage should be registered in the inventory register.

• The Ministry should discipline the mechanics found to be negligent.

• If the above recommendations could not be implemented the ministry should consider outsourcing this operation to the private sector as it would be more economical.
Management Comments A transport committee has been formed and 2 meetings have already been conducted, one of its role is look at the running of the Tamavua garage to ensure that there are no abuses and also the service rendered are to par.
The garage will only do B2, brake, wiper and greasing serving together with tyre repairs, minor welding and adjustment of door hinges .All major maintenance work will be contracted out as this garage is not designed for major works 15 Internal Memo from Chief Executive Officer, December 2005.

Ministry of Health Section 19: Page 23 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The transport officer at HQ is now in charge of the garage and controls the daily running of it.
The stock inventory has been done and all records are kept at HQ and the mechanics are in charge of the tools.

The Transport officer will do quarterly stock take of this.

Appropriate action will be taken against those mechanics that loose or damage the tools.

Further OAG Comments A stock take has not been carried out, when audit last checked on 17/07/08.
19.23 Negligence over Garage Items Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.

A tyre changing machine purchased in December 2005 for $5,480 has not been used to date as the compressor has not been installed.

One 6 cylinder engine purchased for the Levuka Hospital Ambulance for $1,900 from Bhan Auto Parts was lying idle in the garage.
The ambulance had been repaired and returned to Levuka.

Moreover, no investigation as recommended in the 2006 audit report was carried out by the Ministry into the use of the equipment Tyre Changing Machine still lying idle as at March 2008.

6 Cylinder Engine still lying unused as at March, 2008 Proper value has not been obtained from the purchases of the above equipment.
Recommendations • The Ministry should ensure that the tyre changing machine is put to use at the Garage and consider selling the 6 cylinder engine and recover the cost.

• The Ministry should discipline officers who failed to properly exercise value for money.

Management Comments Tyre Changing Machine – The electrical wiring has been carried to run this machine.

This machine needs a compressor to run and the tyre repairing service should commence by end of July 2008.
Ministry of Health Section 19: Page 24 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Negotiations are being made with few of the private garages to sell the engine initially bought for Levuka Hospital but not used, Note - Most of the officers involved in purchasing the tyre repair machine or the engines have left the service.
19.24 Unserviceable Vehicles not boarded It is the responsibility of the head of the department to ensure that boards of survey are convened in respect of unserviceable vehicles, which should be promptly disposed by auction or otherwise instead of leaving them to deteriorate in departmental yards.

The surveys are to be arranged with the Controller of Government Supplies.16 Several unserviceable vehicles belonging to the Ministry were parked at different health facilities.
Although this issue was raised in the last audit report, the Ministry has yet to take any action.

Refer to the pictures below for vehicles which need immediate boarding, as their condition continues to deteriorate due to adverse weather condition, which subsequently reduce resale values.
Dental Mobil GK187, parked & rusting due to weather condition GK725 parked at CWM hospital, as shown in picture, parts stripped 16 Transport Rules & Instructions 42(a) Ministry of Health Section 19: Page 25 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 GL063 and GL506 parked at the Tamavua Garage GL271 parked at the Tamavua Garage The failure to board vehicles in a timely manner has led to the condition of the vehicles deteriorating and vehicle parts being cannibalized.
This practice has greatly reduced the resale value of the vehicles.

The conditions of these vehicles would deteriorate further and their resale value would continue to decline as a consequence if immediate action is not taken to dispose them.

Recommendation The Ministry should strictly adhere to Transport Rules & Instructions 42(a).

Management Comments Recommendations have been made to COGS for the write off.
19.25 Poor Workmanship at Tamavua Garage All vehicles should be repaired in a timely manner to ensure that unnecessary overhead costs are not incurred.

Audit scrutiny of the mechanical work at the Tamavua Garage revealed cases of poor workmanship which resulted in vehicles being taken to private garage for repairs.

Refer to the following examples for details.


a) Rakiraki Ambulance (GL064) As highlighted in the 2006 audit report, this ambulance was parked at the Tamavua Garage after being towed from Marine Motors at a cost of $ 650 for storage from January to September 2005.

After undergoing repairs at the Tamavua Garage, the vehicle underwent further repairs by Jhokesh Motors for $9,776 before being returned to Rakiraki Hospital.
Details of cost of repairs undertaken by the Tamavua Garage were not provided but repairs by Jhokesh Motors are as follow: TABLE 19.13: REPAIRS OF GL064 AT JHOKESH MOTORS LPO # Particulars Date of Service 64582 61202 Total General Maintenance and electrical work General bodyworks and electrical repairs 28/9/07 19/7/07 Amount $ 1,800 7,976 9,776 Ministry of Health Section 19: Page 26 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Repairs to GL 064 parked at Tamavua Garage under repair as at January 2007. b) Pajero S/W/B (GL271) Vehicle registration number GL 271 was brought from Navua Hospital in March 2006 to the Tamavua Garage for bodywork which commenced in early 2007 by the mechanics.
Audit also noted that painting material worth $396 was also purchased for GL271 but was not used and the whereabouts of these are unknown.

A visit to the Tamavua Garage in March 2008 revealed that the bodywork for GL271 was still incomplete and the vehicle was parked outside and exposed to all weather conditions.

Refer to pictures below for details: Body work undertaken of GL271 at Tamavua garage in 2007.

GL271 parked outside Tamavua Garage as at March, 2008.
Repairs to the vehicle are still incomplete and had taken a lot of time and resources.

There is evidence that the mechanics at Tamavua Garage are incompetent and not qualified to undertake motor vehicle repairs.

Recommendations • The Ministry should take disciplinary actions against the mechanics responsible for the repairs of the above vehicles.

• Only qualified mechanics should be employed at the garage.
• The Ministry should streamline the operation at Tamavua Garage and maximize its use by ensuring that all ministry vehicles are repaired within.

If this process cannot be achieved, repairs of ministry vehicles should be outsourced as it would be more economical.
Ministry of Health Section 19: Page 27 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments The recommendations are noted and appropriate disciplinary action will be taken once the full details of the paint etc are located 19.26 Improper Supervision of Ministry Vehicle Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and thereby ensure that proper value is obtained for all sums spent.
Audit inspection at Tamavua Garage revealed that vehicle GM549 was parked at the Garage and had not been used for over 18 months after it was repaired.

Audit noted the following irregularities: • As highlighted in the audit report in 2006, this vehicle was repaired at Marine Motors for $4,450 in May 2006 and later additional cost incurred for removing rust was $4,875, totaling $9,325.
After the repairs it was parked at the Tamauva Garage where its condition continued to deteriorate (refer to the picture below).

The Ministry in response agreed to investigate and discipline the responsible officer.

• Audit checks this year revealed that no investigation was conducted as suggested by Ministry.

• Audit carried out a check with LTA for the vehicles inspection certificate, but found out that the vehicle was not registered with LTA and that it was not authorized to be driven on the road.
• The vehicle is currently parked at the Tamavua Garage and exposed to adverse weather conditions.

Refer to the pictures below: The rusted door step of GM549 as at April, 2007 GM549 parked outside Tamvua Garage in March, 2008.

Poor management of vehicles and maintenance is evident in this case and proper value was not obtained for the $9,325 spent on the repair of the above unit.

Recommendations • Responsible officers should be disciplined.
Ministry of Health Section 19: Page 28 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The Ministry should register the vehicle GM549 with LTA and further repairs needed should be undertaken.

Management Comments Recommendation noted and disciplinary action will be taken against those after and internal investigation has been completed.

The vehicle is registered under LTA.The vehicle no.

GM549 was last given fitness and registered under LTA on 12/02/03.
A/EOT is making arrangements to seek further clarification from LTA on this vehicle as this vehicle is currently out of road and parked at Tamavua garage.

19.27 Excessive Usage of Private Garages The Ministry’s Garage was reopened in January 2005 after a being left unused for the past 4 years.
The Chief Executive Officer indicated that the work at the Garage would involve all levels of vehicle servicing, minor mechanical and electrical works and that panel beating/body work will be developed from 2006.17 Despite the Ministry operating its own garage at Tamavua, there had been continuous engagement of the services of private garages.

From 2005 until 2007 private garages which are located in the central division were paid $1,119,389.

Refer to Appendix 19.6 for more details.


Vehicles under warranty were not usually taken to agents but instead to non-reputable garages and repairs became more frequent after that.

The lack of proper supervision and monitoring of vehicle repairs by the transport officers have resulted in excessive repair cost carried out by private garage.

Recommendations • The Ministry should ensure that the Tamavua Garage is re-organized so that its operation can be more economical.
• The Ministry should only recruit qualified mechanics, purchase appropriate machine and equipment to be used at the garage and engage a supervisor to manage operations at of the garage.

• Management should create a committee at the Ministry Headquarters to specifically look into any repairs of vehicles over $1,000 and be responsible for calling closed tender quotations and those officers who fail to follow should be severely disinclined.
If the Ministry cannot implement the above recommendations, it should consider closing the garage operations and outsource all vehicle repair works to the private sector.

• Management Comments Recommendation is noted and transport committee will look into this.

This is not feasible in near future due to the new staff intake restriction placed by PSC.

Committee has been created and it will decide on this.

17 Internal Memo from Chief Executive Officer, December 2005.
Ministry of Health Section 19: Page 29 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.28 Poor Monitoring of Vehicle Repairs Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and ensure that proper value is obtained for all sums spent.
The vehicle GN173 was involved in an accident in December 2005 and was repaired at Jeral Auto Services at a cost of $7,096 which was paid on 21/12/05 vide cheque no.

080285.

The Garage ceased operation in April 2007 however repairs to the vehicle had remained incomplete.

Further repair was then undertaken by Jhokesh Motors for a further $4,440 which was paid on 14/5/07 through cheque no.

124740.

This garage also ceased operation in early 2008 without completing the repairs to the vehicle.
Audit visited the location where Jhokesh Motors operated from only to find out that a new company by the name of Embee Motors had taken over, and GN173 was still parked there; refer to figure 2.

Embee Motor Works had also written to the Ministry quoting $11,670 to complete the repairs for GN173.

Figure 1:GN173 in the garage at Jeral Motors in 2006 Figure 2: GN173 in the garage at Embee Motors in 2008.
Repairs made to the above vehicle were not properly monitored and a substantial amount totaling $11,536 was spent on it, and after a period of about 3 years, repairs are still incomplete.

Proper value has not been obtained for all sums spent.

Recommendations • The Ministry should discipline all the officers involved in the repairs of this vehicle.

• The officers who had authorized the payments without checking the progress to the repairs was completed should be surcharged.
• The companies that delay repair works should not be considered for any further government contracts.

Management Comments The recommendations are noted and the transport committee will monitor all future repairs to avoid such incidents.
Ministry of Health Section 19: Page 30 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.29 Poor Workmanship at Private Garages Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds and ensure that proper value is obtained for all sums spent.
The Ministry had been engaging private garages to carry out repairs on its vehicles; and the following irregularities were noted by audit: • There were many repetitive repairs on the Ministry vehicles.

Refer to the Appendix 19.7.

• The authenticity of the work carried out at these private garages cannot be guaranteed as the Ministry staffs failed to scrutinize the work carried out.

• The risk of collusion between Ministry officials and the private garages cannot be ruled out.
The lack of monitoring of repairs on vehicles at private garages and the risk of collusion between Ministry officials and the owners of private garages cannot be ruled out and this in turn has led to repetitive repairs on the same vehicles and exorbitant charges to the Ministry.

Recommendation In all future repairs at private garages, the Ministry’s mechanics should scrutinise the repairs against the invoice details to ensure that all repairs paid for were actually carried out.
Management Comments All necessary precautions are being taken to avoid this sort of practices.

19.30 Local Purchase Orders raised after Additional Repairs Before any Local Purchase Orders is issued, 3 competitive quotations are to be obtained.
Audit scrutiny of repairs of the Ministry vehicles revealed that there were many cases where vehicles were taken into a private garage for repair and whilst repairing another of the Ministry’s vehicle would be given to that particular company and subsequently another LPO would be issued without obtaining quotes from other garages; for example refer to Appendix 19.8.

In not obtaining competitive quotations the Ministry may not be obtaining the most economical service.
Recommendations • The Ministry is to ensure that all repairs carried out by the Ministry should have 3 competitive quotations.

• Officers who were responsible for the above anomies should be disciplined.
Ministry of Health Section 19: Page 31 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments All the recommendations are noted and all the matters relating to our transport issues are now handled by the transport committee to ensure that we do get the best services for the money paid.
FIJI PHARMACEUTICAL SERVICES 19.31 Expired Drugs In the National Drug Policy of 1994, the Ministry of Health states that it would strive to improve and standardize inventory control procedures at all levels of the public drug system.

Minimum and maximum stock levels will be introduced, systematic stock rotation ensured, dead stocks and expired stocks identified and either disposed off or, in the case of non-expired useable items, redistributed.
Examination of drug records at the Fiji Pharmaceutical Service revealed that expired drugs to the value of $671,645 were still held in 2007.

A comparison of expired drugs held by the Fiji Pharmaceutical Service for the last five years revealed the position has not improved.

Refer to the following Table 19.14 for details.


TABLE 19.14: EXPIRED DRUGS Year 2003 2004 2005 2006 2007 Total Amount Budgeted $ Total Amount of Expired Drugs $ 8,032,500 8,032,500 8,032,500 8,032,500 9,500,000 41,630,000 243,552.86 235,543.00 518,389.30 387,441.19 671,645.67 2,056,572.02 It was further noted that expired drugs occupy unnecessary space in the warehouse and no action is being taken to dispose them.
The above indicates that no control is in place to monitor and coordinate the ordering and distribution of drugs in the country and this has resulted in substantial losses through expired drugs.

Recommendations • Instructions under the National Drug Policy should be adhered to by the Fiji Pharmaceutical Service at all times.

• Proper procedures must be put in to place to ensure that there is a proper co-ordination between the ordering and distribution of drugs in order to avoid overstocking of drugs.
Ministry of Health Section 19: Page 32 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments Year 2003 2004 2005 2006 2007 Budgeted Drugs $ Total Amount $ 8,032,500 8,032,500 8,032,500 8,032,500 9,500,000 243,552.86 235,543.00 518,389.30 387,441.19 671,645.67 % Expiry (total inventory holding) $18,000,000 1.35% 1.31% 2.88% 2.15% 3.73% The total expired amount needs to be viewed in proportion to the total inventory that FPS stocks.
FPS stocks an estimated amount of $18M worth of inventory stocks.

In terms of percentage of obsolescence, this figures amounts to well below 5%, an indicator used by the WHO to estimated performance on obsolete stock as percentage of total inventory holding.

In addition, strategies have been put in place to ensure that expired stocks are reduced.

Suppliers have been reminded that the life span for all drugs and consumables should not be less than 18months.
Suppliers have been instructed to replace stocks with less expiry and they have adhered to this arrangement.

The other factor is that other health facilities return their expired stocks to FPBS.

Our warehouse have become like a dumping ground for expired drugs and consumables.

The reasons are that health workers in the divisions are not fully aware of the procedures to write off stocks.

Furthermore the total amount of drugs of 2007 is a cumulative of some of 2005 and 2006.
These expired stocks, unserviceable reports were prepared and given to COGS however this reports were held back by the Verification Officer.

The officer claimed that procedures were not done and he will do another independent stock-take, which was done in 2007.

These were the figure that was reported in the 2007 Expired Report.
19.32 Out of Stock Drugs The aim of the National Drug Policy is to ensure the continued availability of sufficient quantities of the required essential drugs at all levels of the health system, through the accurate and systematic recording, monitoring and reporting of stock levels of all items.

It was noted that some drugs were out of stock at the Fiji Pharmaceutical Service.

Refer to Appendix 19.9 for details.


This implies a lack of proper planning and controls over drug procurement and its distribution to Hospitals and Health Centres.

This will have impact on patients who depend on government for drugs.

Recommendations • Levels of drugs and consumable items in stores should be monitored regularly and reorders made before it reaches to minimum stock level.

• The Chief Pharmacist should be cautioned for not complying with the National Drug Policy of 1994.
Ministry of Health Section 19: Page 33 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comment FPS has had its role expanded beyond pharmaceuticals, to include vaccines, contraceptives, dressings, medical consumables, X-Ray materials, staff uniforms and linen.

FPS has been experiencing a number of problems this year in respect of stock-outs of certain items, including a significant number of essential drugs.
Also, there have been issues arising regarding the supply, internally within the MoH, across Fiji and the MoH’s three geographical Divisions, their hospitals and clinics.

The immediate response to stock-outs has been to buy more stock, to stock-up and to increase the maximum stock levels for a range of items.

When once this has solved the immediate stock-out problems attention will need to focus on the efficiency and effectiveness of stock management and logistics.
In this way the FPS can, sustainable and with reasonable maximum stock levels, manage to avoid stock-outs in future.

One clear contributory factor leading to stock-outs has been the length of the supply chain leading to FPS’ receipt of goods into store.

This length is not only a matter of kilometers, but, very much, one of extended time periods.

Fiji is, by international standards, a small market, a small customer and suffers accordingly in terms of service, particularly the speed of response.
There are also issues within the processes of the Government of Fiji (GoF) that slow down and extend the period between FPS initiating a purchase order and that order being placed with a supplier.

For this reason stocks are monitored regularly and orders are placed when they reaches minimum level.

However the process of issuing an order is quite lengthy and not as straightforward like in the private sector.

The process can take about a couple of weeks to months to issue an order.
This in itself can result in stock outs because it is not factored into the lead-time.

New strategies have been put in place to ensure that orders are initiated once stocks have reached reorder level and not minimum level.

This is to factor additional processing time where suppliers need to commit through Pro-forma purchase order before Indents or purchase orders are issued.
19.33 Damaged Drugs Heads of departments shall be responsible for the proper custody and control of all public stores in their departments18.

It was noted that drugs and consumables were damaged during the flood in 2007.

The extent of the damage is valued at $93,050.

The lack of preventative measures by management resulted in loss of drugs and consumables.

Recommendation Fiji Pharmaceutical Services should always take precautionary measures to avoid any loss of public stores during natural disasters.
Management Comments Proper custody and storage of stocks remains paramount for management.

Every effort to ensure drugs and consumables are cleared from the containers once it arrives at FPBS.

Due to receiving procedure it make it difficult to un-stuff containers all at once.

New stocks need to be checked and verified before it can be stored in the Bulk.

Our 18 Supplies & Services Instructions 12.


Ministry of Health Section 19: Page 34 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 system allocates empty rack locations in the Bulk and stocks cannot be stored all at once.

New stocks will only be moved into the racks with the availability of pallets and empty racks.

Unfortunately in this instance, containers arrived on Friday and were not cleared because of the limited space in the Bulk.
The unfavourable weather was something beyond our control during the weekend.

This resulted in the stocks being damaged because the front yard was flooded.

The poor drainage system also contributed to the flooding of the yard.
19.34 Short Expiry of Advantage Strip The minimum time of expiry of drugs and consumables upon reaching Fiji Pharmaceutical Service should not be less than 18 months.19 It was noted that 20,000 advantage strips were purchased and received on 10/1/07 but a total of 6,332 worth $167,798 expired on 10/2/08.

The advantage strips had expired within 13 months instead of the required 18 months as a result of poor inventory issues and distribution.
Recommendations • Instructions under the National Drug Policy should be adhered to by the Fiji Pharmaceutical Service.

• Consumable items should be issued using the First- In-First –Out method.

• Levels of drugs and consumable items in stores should be monitored regularly and it should be issued out before it reaches its expiry date.

Management Comments The National Drug Policy is still being adhered too in terms of 18 months expiry.

The 20,000 strips were purchased due to the high demand of strips.
Unfortunately the strips were not sold as first in first out and also of the changes in machine from Accu-Check to Omi Test.
19.35 Risky Storage Area Regular checks will be carried out on the quality of stored drugs at all levels to ensure that they have not deteriorated under the storage conditions prevailing at each location.20 Some slow moving drugs and items namely Cellulose, cotton wool, IV Giving, 5,10 & 50ml syringes, auto clave bags, identification bracelets for infants and plastic bag for dispensing were stored at the old Government Pharmacy due to lack of space at the new pharmacy complex.
The total value of these items in 2007 was $512,146.

19 Conditions of Contract for Supply of Goods (4.9.1) 20 Fiji National Drug Policy 1994-section 6.2 Ministry of Health Section 19: Page 35 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The storage of drugs and consumables at the Old Government Pharmacy is a risk as reported in the previous year that a number of items were damaged due to heavy rain and leakage.
The failure to adhere to the Fiji National Drug Policy (1994) could result in further damaged drugs and loss to government.

Recommendation The Fiji National Drug Policy 1994 Section 6.2 should be adhered to at all times.

Management Comments These consumable were identified as slow moving and the reason these stocks were moved to another Warehouse to allow for new stocks to be cleared and stored in the Bulk Warehouse.
The premises are still under the Ministry of Health and requests were submitted to HQ to do repair works because some of the stocks were stored there.

19.36 Poor Control in Receiving Delivered Items Upon receipt of the goods, services or works, the receiving officer shall verify that their receipts are in good order and that the invoice is in accordance with the LPO.21 It was noted that upon receiving of items, delivery dockets were signed without any verification done to the Invoice or LPO.
This resulted in the delivery of two wrong quantities of items despite the delivery docket being signed by the delivery officer.

The items ordered under indents 421/07and 299/07 were delivered on 4/12/07.

On 19/12/07, the Supervisor for the Receiving Items, Mr Mitieli Maraiwai, noticed that items ordered as per indent No.

421/07 were delivered but items ordered under indent No.299/07 worth $6,321 had not been received.
Further investigation by the Fiji Pharmaceutical Service revealed that the supplier (B Braun), freight forwarder (Maersk) and Controller of Goods and Services confirmed that the package contained two indents.

At the time of compiling the report, the FPS has still to identify the whereabouts of the items in indent No.299/07.

The above irregularity is a direct result of laxity of senior officers to ensure that proper internal control procedures are in place.
Recommendations • The Officer responsible for this irregularity should be surcharged for not exercising proper control and custody of the delivered items.

• Management should ensure that proper procedures are followed regarding the receipting, custody and storage of drugs and consumables.
21 Ministry of Health Finance Manual 2005 2.5.14 Ministry of Health Section 19: Page 36 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Management Comments Management have put in standard operating procedures which clearly defines the steps of receiving new stocks in the Warehouse.

Furthermore the Supplies and Services Instructions also clearly state the responsible of store man when receiving stocks.
Investigation has been conducted and the final assessment is that the item with Indent No: MD299/07 was not supplied by BBraun.

This has been communicated to the supplier and they confirmed that they would conduct their own investigation before they can actually ascertain the where about of the missing item.

Since 2007 with the introduction of the new payment method after goods are received, checked and satisfied, significant improvement have been seen for goods with short shipment.
CWM HOSPITAL 19.37 Current Condition of CWM’S Ambulance Ministry of Health is required to provide the ambulance services in public hospitals at a level comparable to international best practice.

CWM Hospital however has only three Ambulance vehicles of which two had been under repair (GM005 and GL842) since February 2007.

Refer Table 4 for details.

Moreover, vehicles currently used by the Ministry for ambulance services are not well equipped.
TABLE 19.15: CONDITION OF AMBULANCE Station Vehicle # Year Reg.

Audit Checks Revealed CWM Hospital GL842 1993 Under repair at Kritika Motors since February 2007 Very old, brakes not working properly and due to being very old is only used to transfer patients from New hospital to Old and vice versa.

CWM Hospital CWM Hospital GM005 GN268 1994 2000 Under repair since late 2007.
Working but very old and under repair in most of 2006 Patients are at risk and also inconvenienced when hospital services are not up to expectation.

Recommendation The Ministry should review its fleet and ensure that it meets the required standard.

Managements Comment Replacements of vehicles and Ambulances are beyond our control as it is handled and decided for by the Ministry of Health Head Office and Ministry of Finance.
Ministry of Health Section 19: Page 37 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.38 Service Rendered Without a Written Agreement A written contract or agreement must be entered into with the approved tender for the supply of the goods, services or works tendered.
Legal advice must be sought on the draft contact or agreement unless the CEO approves otherwise in writing.22 The Canteen Service at the Maternity Ward was operating without any written contract or agreement and no rent was collected since it started operation in 2006.

Mrs. Atelini Dakua, Director for Operation Food for Life is currently operating the canteen.

The government is being deprived revenue from the use of this canteen as there is no approved rental agreement.
Recommendations • The current tenant should cease its operation and a new tender called.

• An economical rent should be assessed and the current operator charged the rental arrears.

• Responsible officers should be surcharged if the rent is not recovered.

Managements Comment This Agreement between the Dorcas and the old hospital management was made verbally and we confirm that we will now give notice to the current company to cease operations and a new tender will be called.
I understand that the person responsible for this Agreement has left the country and now settled in New Zealand.

Every effort will be made to recover all cost involved.

19.39 Old Machine and Equipment The Ministry of Health’s mission statement states that it will be responsible for providing quality health services for the people of Fiji through a strengthened divisional health structures.23 Some old machine and equipment that need urgent maintenance and replacement are still being used by the Hospital.
Refer the following: • Standby Generator – Maternity Services: This generator can only back up lights and not air condition and other necessary equipment needed for delivery services.

• Mortuary - The structure or frame for the mortuary cabinet and the inside trays where the bodies are kept have rusted and subsequently deteriorating.

Refer to the pictures below.

22 Ministry of Health Finance Manual 2005 2.4.16 23 Ministry of Health’s Mission Statement.
Ministry of Health Section 19: Page 38 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The old back up generator for maternity unit The front doors of the mortuary rusting Dryers: Out of 6 dryers used at CWM, 2 are no longer operating due to damages sustain by their motor and need to be repaired/replaced.
Front view of the old Dryers at the Laundry The back of the dryers have started to erode away The dryers are considered to be obsolete and would have significant maintenance cost.

Recommendation The ministry should draw up a maintenance and replacement program for its equipment to ensure that regular maintenance is carried out and obsolete equipment identified and replaced.
Managements Comment Every year CWM management has complain and requested this in budget submission to HQ for machines and equipments to be replaced but nothing positive has happened.

Plans are in place to improve and upgrade our Mortuary services and it is with the MOH planning unit.
Ministry of Health Section 19: Page 39 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 LAUTOKA HOSPITAL 19.40 Expired Drugs The Ministry of Health will strive to improve and standardize inventory control procedures at all levels of the public drug system.
Minimum and maximum stock levels will be introduced, systematic stock rotation ensured, dead stocks and expired stocks identified and either disposed off or, in the case of non-expired useable items, redistributed.24 Audit inspection carried out at the Lautoka Hospital pharmacy records revealed that for 2007, $11,657 worth of drugs had expired at the pharmacy.
Furthermore it was noted that even though some of these drugs were near expiry, the pharmacists had not distributed them to medical centers where they could be utilized before expiry.

The absence of improved and standardized inventory control procedures has resulted in expiry of drugs on the shelves.

Recommendation Management should ensure that a monitoring system is in place to ensure near expiry drugs are identified and distributed to Health Centres or other hospitals for use before expiry.
Management Comments Decrease in percentage of expired drugs – In 2007 the Pharmacy Unit has managed to decrease the percentage of expired drugs from 1.93% to 1.31% of our total budget, which is a great achievement.

Shortage of manpower – in the logistic section to closely monitor stocks and inventory management.

There is only one staff that looks after the logistic section in order to fulfill its roles and responsibilities.
Near expired drugs – Most of the drugs received from FPS have near expiry date in which they will be used until the drugs expired on the shelves.

Redistribution to other health facilities is part of the Pharmacy Unit inventory management but it is always impossible since all have the same batches and expiry date of drugs.

Slow moving drugs [high cost] – Some of the very slow moving drugs, which are high in cost, Accumulate to the total cost.
For instant, 16 expired Emla Patch worth $2,222.91 and it is one of the slow moving drugs.

High usage and vital drugs – Some of the high usage and vital drugs that the Pharmacy Unit has to order every time have short expiry date and yet they still have to order maximum stock level to meet demand from wards and members of the public.
24 National Drug Policy (1994) Ministry of Health Section 19: Page 40 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.41 Contract Service It is mandatory requirement to obtain legal clearance (including vetting) on all contracts, agreements, etc government is party to before they are signed and sealed.

It should be reiterated that the draft contracts should be forwarded to the Attorney General’s Chambers for vetting as early as possible.
Where liability is incurred against government directly arising out of weakness in the contract documents, where the prior clearance of the Attorney General’s Chambers was not obtained, appropriate action should be taken against the officer(s) concerned which may include surcharge action to recover the cost.

25 The General Manager at Lautoka Hospital had engaged Chemdry Chemicals to supply Laundry Chlorinated Powder for a period of 3 months without any quotations or any formal approval from Headquarters.
The laundry powder from Chemdry Chemicals cost $236 per 25kg while another supplier, Mean Products was selling at $155 per 25 kg.

Significant savings would have been realized had proper tender process was followed and a contract drawn up with the most competitive supplier.

Recommendations • Management should terminate its 3 month trial basis with Chemdry Chemicals and call for new tenders.
• The use of Chemdry Chemicals to supply Laundry Powder should be investigated and should there be any evidence of mismanagement, appropriate disciplinary action should be considered.

• Consideration should be made on recovering the difference of the prices charged by the 2 suppliers.

Management Comments The choice to engage Chem.

Dry was due to a need that Chem.

Dry could provide for the hospital as outlined in 7.5.
Electronic Solutions had the monopoly for many years and we believed that we weren’t being given value for money.

The previous GM gave Chem.

dry a trial to provide laundry chemicals whilst they would also provide maintenance to our machines FOC.

This service is not provided by Means or KAKs.

From October 2007 to December, our records show that the machines have been in running order most of the time.
We renegotiated their chemical costs to be within our budget whilst they continue providing the service to the machines.

This they have done and for the first three months, we have had no major breakdown, which is excellent.

The machines are 17 years old and therefore they need daily doctoring!!

Machines will breakdown anyway due to wear and tear but it has been to our advantage to engage them at no added cost.

We will be reviewing this agreement to ensure that its value for money.
WESTERN HEALTH SERVICES 19.42 Uneconomical Spending Accounting officers and all other officers responsible for expenditure shall at all times exercise proper economy in the expenditure of public funds thereby ensure that proper value is obtained for all sums spent.
25 PSC Circular No.39/99-Mandatory Requirement-Legal Clearance on All Government Contracts, dated 29/10/99 Ministry of Health Section 19: Page 41 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 The Mercer Autoclave Machine at the Lautoka Hospital had broken down since 7/7/03.

A number of repair works had been carried out by the company, Electronic Process Solutions but the machine remained out of order.

The total cost of repairs amounted to $10,895.


Recommendation Management should ensure that a proper economy of public funds is given priority and appropriate expertise is engaged to bring the machine to operating condition.

Management Comments The machine experienced a first major breakdown after 8 years of its usage and with no knowledge of electronics in our Hospital Service staff; we have no choice but to outsource in order to have it repaired.
We were at the mercy of electronic solutions as they had monopoly for years.

Electronic Process Solution was called to investigate and provide a quote since the company was also repairing our laundry washing machines.

The following procedures were followed in seeking approval: Requisition was prepared and submitted with quotes for approval by GMLH Approval given for processing LPO LPO forwarded to Director WHS for signing.
As the company that has repaired our laundry washing machines for the last 10 years with no complaints of return and uncompleted work, we had confident that the machine would be repaired.

However, as time moved on, we noted that the company seemed to treat the repair of hospital washing machine as its low priority.

This is despite the fact that follow up actions were taken by management.

We were advised also that EPS does repair similar machines in Hotels and well-known companies.
Hence due to delay in sourcing the needed parts to repair the machines from overseas by the above company, and the urgent need to have the machine running at the same time for obvious reasons, we had no option but to look for an alternative source to take on the responsibility to repair the machine.

The electronic problems were repaired on 11/10/07.


19.43 Loss of Government Revenue The charges set out in the third schedule shall be paid by agent of aircraft for overtime work by any officer of the Ministry of Health as specified in the said schedule.26 The Ministry was not charging the aircraft agents for the services provided by health inspectors.

Instead the Ministry was paying the officer’s overtime and meal claims in addition to their normal salary for carrying out such tasks.
Tabulated below are overtime claims paid to Health Officers at the Nadi Airport during 2006 and 2007.

Refer to the Appendix 19.10 for a breakdown of the costs.
TABLE 19.16: OVERTIME CLAIMS FOR HEALTH OFFICERS 26 Quarantine Act Cap 112 Section19(3) Ministry of Health Section 19: Page 42 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Year 2006 2007 Total Amount $ 74,534 63,759 138,293 By failing to charge quarantine fees, government is forgoing revenue it has rightfully earned.

Recommendation The Ministry should enforce Quarantine Act 112 Section19 (3).
Managements Comment The decision to charge Health Quarantine Services is very long overdue despite being stipulated under the 3rd schedule of the Quarantine Act cap.

112, section 19 (3).

I believe the main reason no fees had been charge on various quarantine duties carried out was because the services were the responsibilities of the Fiji Government then, who was solely delivering the services for free.
The Ministry of Health is the only government ministry/department delivering the services for free at Nadi Airport right now.

Immigration, Customs and Agriculture Quarantine are charging services they deliver.

To off-set the high cost of maintaining the delivery of Health quarantine services at Nadi Airport, I recommend: Charging of fees for all quarantine activities carried out at Nadi Airport.

Reviewing of Quarantine Services at both Nadi and Lautoka Ports of Entry.
Review of current charges of fees at Lautoka Port of Entry.

The Quarantine Unit at Nadi Airport to be a specialize unit of its own and to run its own affairs.

19.44 Loss of Laptops Government assets should at all times be safe guarded against theft or misuse.

Audit noted that the Director of Western Health lost two laptops on the 18/10/06 and another on 12/2/07.

The total cost of the laptops is $7,000.


Further investigations revealed that the Director of Western Health had not been surcharged for the loss of the laptops.

Recommendation Management should investigate the circumstances surrounding the loss of lap tops and if necessary disciplinary action against the officer should be taken.

Management Comments The western health Office is located along the main traffic way and a night club just opposite, hence, it’s exposed to drunkards and all sorts of characters.
The Office is adjacent to what can be described as a “brothel.

And it was common knowledge that marijuana was often used in the vicinity.

The western health office evolved in its establishment and it didn’t have any security officers when I joined in 2004 as it was not part of the establishment.

A request to have a security was denied.


The office was ransacked in October as thieves broke through the restauraunt below the office and gained access through the back door by breaking into the office door and entered most of the Ministry of Health Section 19: Page 43 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 offices looking for money.

Thieves forced open the office door stole laptop was in the cabinet and was taken from there.
Police were called upon discovery the following morning and report sent to DCS.

To this day the police have not caught the culprit.

The stolen Laptop was issued to Dr Rabukawaqa.

A request was made for a replacement as would have been done by any officer.

The prerogative is the CEO’s.

Following the events at WHS, a security officer was employed to watch at nights, during the most at risk periods- Thursday to Sunday.

Fulltime employment was not possible, as this request was not approved.
We had a staff meeting between 8.15 to 8.45 on the morning of the said day am.

The laptop was in the office [door closed], we were all in the conference room.

The lady who was supposed to be sitting at the switchboard decided to come in as well [only discovered when investigations were done].

Two staff were sitting at the entrance to the office waiting for a training session.

Someone had come in through the main entrance, and taken the laptop, a brand new Razer mobile and my purse from my bag.
The gentleman was assumed to be from WHS, as he had a similar colored uniform but was noted to be holding a black bag.

He walked passed them on his way out.

The police were contacted immediately upon discovery and gave chase but he was nowhere to be found.

Report was sent to PSH via Manager General Services.

My cards were later found under the carpet next door [“brothel”] but police could not to this day catch the culprit!
It is no secret that WHS is a prime target due to its location and several staff can testify to the thefts they have personally experienced in the office.

Adjacent Hub center was also the target.

All losses were handed to the police for investigations.

And reports sent to HQ.

The landlord was always informed regarding security issues.

A security officer was provided, security locks provided, Enquiries desk changed and operator to be on site –mandatory.
Security is now a major issue as I have repeated brought to the attention of NEC and I don’t think I should be surcharged at all.

Dr Tui Taoi Ex Director Western Health Services.

NORTHERN HEALTH SERVICES 19.45 Tyre Records All goods received in an undamaged condition and which are in no respect defective shall be taken on charge in a stock register.27 There was no stock/tally card maintained for tyres at the hospital prior to November 2007.
A lot of damaged tyres were stacked in the storage area taking up unnecessary space and there was no record maintained for these damaged tyres.

An internal investigations on the on the usage of tyres at Labasa Hospital was carried out by L. Conaliku (AAO) in October 2007.

The following defects were highlighted in her report dated 31/10/07: • • • • • Various LPOs had been issued for substantial number of tyres at once and not on the basis of need.
There was a lack of control in the approval of purchase of 45 tyres costing $5,128 at one particular time on 21/3/07.

There was no proper recording of receipt and issue of tyres by the store man.

Verification of availability of tyres at Supplies Department was not carried out before issuing orders to private companies.

Only 25 tyres have been confirmed as fitted on official vehicles and the whereabout of the balance of 51 could not be determined.
27 Supplies and Services Instruction 44(1) Ministry of Health Section 19: Page 44 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 There was obviously a lack of control over receipt, issue and storage of tyres at the Labasa Hospital.

Recommendations • A thorough investigation should be carried out and disciplinary action should be taken against those involved.

• A proper record should be maintained by the store man to properly record and account for all receipt and issues.
Management Comments There was a weakness in our monitoring for the records of tyres bought and issued out.

One of the main problems was lack of staff and the lack of space for the Mechanical Stores.

This is one of the areas which we are improving now.

The tyres are currently issued on exchange basis, the used rubber tyres are sold to Bandag while the damaged one are burned.

Below are actions that we have taken on various defects that were highlighted by the audit personal.
The store man have been informed of the issue raised and he is now keeping maximum stock required to meet the hospital needs Stringent control measures have already been taken to ensure all requests are vetted and processed when need arises.

Tyres are now kept at hospital stores and tally cards have already been opened to record receipting and issuing of the items All standard stock items are now verified before orders are given to private companies.
We are still waiting for Mr James to provide his explanation with all necessary supportive document and if he fails to respond on the due date than the disciplinary committee will take further action in which you will be informed in due course.

FINAL CASH ACCOUNT 19.46 Delay in Banking The Cashier shall bank money received on a daily basis at least.

The lodgement form shall be prepared in triplicate detailing the deposits to be made.28 If it is not practical to bank money daily i.e.
if banking facilities are not accessible or money received is less than $50, money may be kept overnight, but it must be kept under lock and key in a safe or strong box.29 Audit noted that there were delays in lodgment of revenue at Savusavu Hospital.
Details are shown in the table below: TABLE 19.17: DELAYS IN LODGMENT 28 Finance Manual, section 5.4.1 29 Finance Manual, section 5.4.5 Ministry of Health Section 19: Page 45 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Date Receipt No.
16/02/07 28/02/07 06/03/07 09/03/07 12-14/03/07 15-17/03/07 18/03/07 19/03/07 03-07/05/07 09/05/07 09-12/05/07 59301 – 59302 59308 – 59310 59315 – 59317 59319 – 59321 59322 – 59324 59325 – 59327 59328 59329 – 59333 376373 – 376376 376377 – 376378 376379 – 376383 Lodgement Date 22/02/07 18/03/07 16/03/07 22/03/07 26/03/07 16/04/07 27/03/07 27/04/07 09/05/07 11/05/07 16/05/07 No.
of Days Delay 6 days 8 days 10 days 13 days 12 days 29 days 9 days 38 days 2 days 2 days 4 days Amount $ 195.00 169.00 142.00 167.00 112.75 250.00 13.75 63.00 48.50 48.70 339.00 Furthermore, there is no safe or secured place to keep the cash.

Lack of control over revenue collection and delays in banking increases the risk of misappropriation of funds.

Recommendations • The clerical officer at the hospital should be cautioned to ensure that banking is done on a daily basis.
• For security reasons, a safe or a lockable cabinet should be maintained at the hospital.

Management Comments The clerk Mere Marama had admitted that she used the revenue for her personel use and repaid later that delay banking in this instance.

Disciplinary action will be taken against her , a minute to this issue has been conveyed to relevant office for further action.

We will request MoF for a safe which will be carried out early 2009 since they have exhausted their budgetary allocation for 2008.
19.47 Issuing of LPO after Cut of Date Ministry of Finance had issued a circular to ensure that no LPO are not issued beyond 7/12/07 with the only exception to supply of emergency goods and services.30 The Ministry had raised LPOs even after the cut off dates and that the nature of some of the transactions in which the LPOs were raised were not for essential services.

Refer to Table 19.18 for examples of non essential LPOs which were issued after the cut off date.
TABLE 19.18: DETAILS OF LPOS ISSUED AFTER 07/12/07.

LPO No.

Date of Issue Vendor Name 68489 31/12/07 Raffles Trade Wind Hotel Total Amount $ 1,068 30 Finance Circular No.

21/2007 section 7.12 & 7.13 Ministry of Health Section 19: Page 46 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 LPO No.
Date of Issue Vendor Name 68476 68453 68430 68418 68388 68376 68417 27/12/07 19/12/07 18/12/07 17/12/07 13/12/07 11/12/07 17/12/07 Tanoa Plaza Waichui Black transport Crescent Holiday entertainment Davui Printery Command Investment Tradewinds Marine Limited Designgrafix Total Amount $ 17,413 1,533 320 8,800 4,371 780 120 The failure to stop issuing of LPOs is a breach of Finance Circular No.

21/2007.

Recommendation The Ministry should ensure that Ministry of Finance Circular is always adhered to.
Management Comments Comments not received 19.48 Revenue Variances Each Accounting Head shall ensure that revenue is recorded against the correct account; the recording of revenue is reconciled monthly with the Ministry of Finance.
the Ministry of Finance is advised of any errors or discrepancies within 10 working days after the end of each month;31 The following discrepancies were noted between the Ministry of Health revenue balances and FMIS as shown in the table below: TABLE 19.19: REVENUE VARIANCE Balance As Per FMIS $ 1,406,194.75 Balance As per MOH $ 1,404,458.73 Variance $ 1,736.02 Audit therefore, could not substantiate the accuracy of the total revenue received during the year as reflected in the financial statement.
Recommendation The Ministry should reconcile the variances noted in the two records in order to reflect the correct revenue received during the year.
Management Comments No comments received 31 Finance Instruction 2005 – Section 30 (1) Ministry of Health Section 19: Page 47 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.49 Ministry of Health’s State Revenue Overstated The Ministry of Health had collected state revenue amounting to $1,159,155 in 2007 according to the FMIS.

Of the above, the following revenue collections not belonging to Ministry of Health were appearing under Ministry of Health FMIS records.
TABLE 19.20: EXAMPLES OVER STATED REVENUE Details on Misallocation Customs Import Duty License Arms Water Charges Court Fines Rental For Land Rental for Building Commission Revenue from Surveys Miscellaneous Income Tax Personal VAT Total Amount $ 225,916.20 231.00 82.63 1,276.50 31,433.89 76,213.81 26,307.45 1,800.33 54,682.24 347,269.02 193,712.39 958,925.46 Furthermore, the Ministry’s accounting officers were on several occasions requested to take necessary steps to make the necessary adjustments.
These were not done.

The balance of $200,230 is in respect of other revenue such as recovery overpayment etc.

The failure of the Ministry to monitor the correct posting of revenue has led to the overstatement of state revenue.

Recommendations • Ministry should monitor its revenue collections on a monthly basis to avoid any errors and omissions mostly through mispostings.

• The Ministry should have regularized the above posting errors as soon as advised.
Management Comments No comments received 19.50 Non Compliance with the Finance Instructions 2005 Each Agency must include the following statements in its annual financial statements- c) A profit and loss statement for each trading and manufacturing activity.

Ministry of Health Section 19: Page 48 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 e) a statement of assets and liabilities.
g) a statement of Losses h) trust account statement 32 The Ministry had failed to adhere to the Financial Instructions 2005 and failed to prepare and submit for audit the following statements: • Profit and loss statement for each trading and manufacturing activity.

• Statement of assets and liabilities.

• • statement of Losses trust account statement Recommendation Ministry should ensure that the Financial Instructions are adhered to at all times.
Management Comments No comments received 19.51 Annual Report for Ministry of Health Commencing from 2006 financial year, 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 Ministry of Health had prepared its annual report in March 2008; however the Audited Financial Statements including the Auditor General’s audit opinion were missing from the report.
Audit noted that in the annual report under the finance section, the Ministry had Revenue and Expenditure balances which were not audited.

Recommendation Ministry should ensure that the Financial Instructions are always being complied with.

Management Comments No comments received 32 Finance Instruction 2005, Section 82(1).

33 Financial Instructions 2005, Section81 (2).


Ministry of Health Section 19: Page 49 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.52 Failure to Submit Financial Statements before Due Date The draft financial statements must be submitted to the Auditor General by 31 March in the following year.34 The Ministry of Health had failed to submit their Agency financial statements for 2007 before the due date of 31 March 2008.
Furthermore, after several reminder letters and emails, the Ministry sent its financial statement after two on 29/5/08, which was incomplete and lack the following: • Profit and Loss Statement for each trading and manufacturing activity; • Statement of Losses; • Trust Account Statement of Receipts and Expenditures.

Recommendation Ministry should ensure that the Financial Instructions are always complied with.
Management Comments No comments received 19.53 Trust Fund Account – Reconciliation as at 31/12/07 The following defects were noted from the review of TFA reconciliations: 1 501 PD Employees FNPF Out of the total balance of $7,481,525 held in the Trust Fund Account, a total of $6,828,218 or 91% is in respect FNPF contributions.

Under normal circumstances, the employee’s share of (8%) is deducted at source and credited to Trust Fund Account after each pay period.
The total deductions for the month is paid out to the FNPF the following month by charging various allocations under SEG 1 and SEG 2 and 50% to be charged to Trust Fund Account (employees contributions).

Therefore the balance in the Trust Fund Account as at 31/12/07 should be equal to 8% of total gross payroll for December salaries/wages which should not exceed $600,000.
As the Ministry was making monthly payments to the FNPF Board in 2007, there is no reason why the balance held in trust should be so substantial.

Recommendations • The Ministry should investigate as to why such a large balance is appearing in the Trust Fund Account as at 31/12/07.

34 Financial Instructions 2005, Section 81(3).


Ministry of Health Section 19: Page 50 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 • The Ministry should make appropriate adjustments as soon as the irregularities have been identified.

Management Comments No comments received 19.54 Annual Trading Account – Bulk Purchase Scheme As highlighted in the preceding paragraph, the Ministry failed to compile a proper Annual Trading Account and submit for audit.
Furthermore, examination of the Trading Account submitted revealed the following discrepancies when compared to FMIS.
Particulars Cash Sale Credit Sale Purchases Gross Profit Expenses Net Profit Amount As per FMIS Records $ 280,550.94 1,781.05 181,686.97 100,645.52 39,170.10 61,475.42 Amount As per Reconciliation $ 481,423.31 127,005.02 404,681.41 203,746.92 78,956.12 124,790.80 Difference $ 200,872.37 125,223.97 222,994.44 103101.40 39,786.02 63,315.38 Some of the discrepancies noted are substantially high thus the reliability of the reconciliation statement submitted cannot be relied on.
The reconciliation statement includes a sum of $15,260 as accounts payable however is not supported by a schedule of creditors.

It is obvious that the reconciliation statement was prepared without serious input by the Senior Accounts Officer based in Government Pharmacy.

Furthermore, the statement was not checked by the Principal Accounts Officer before submission to this office.
Recommendations • The Principal Accountant should have exercised more care and professionalism to ensure that all necessary reconciliation submitted to the Auditor General are correct and in accordance with the Finance Instruction.

• The Ministry should ensure that necessary adjustment are made in the accounts and submit an amended Trading Accounts for the year ended 31/12/07.
• The Senior Accounts Officer based at Fiji Pharmaceutical Services should be disciplined for not carrying out his duties properly and professionally.

Management Comments No comments received Ministry of Health Section 19: Page 51 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 19.55 FNPF: Variance -2007 It is a mandatory for each Ministry/ Department to ensure that FNPF deductions are made from the personal emoluments at the rate of 8% on each dollar.
Furthermore; the organizations are required to pay their share of 8% from the budgetary allocations thus resulting in a total of 16 % contributions to be paid to the FNPF Board.

The monthly contribution should be paid to the Board by the end of the following month in respect of monthly deductions.

Examination of the total payment made to the Fiji National Provided Fund revealed that the figures shown on the FMIS for Established and Unestablished staff are understated.

Refer to the following calculations.


Detail Ministry of Health Established Staff Total FNPF Paid (employer contribution) Total As Per FMIS GL 670 Variance Unestablished Staff Total FNPF Paid (employer contribution) Total As Per FMIS GL 670 Variance 4,848,025.03 4,804,835.13 $43,189.90 1,236,836.86 1,125,488.74 $111,348.12 Audit therefore could not substantiate the accuracy of the FNPF paid since the actual payments made did not reconcile with postings in the FMIS.
Recommendation The Department should immediately reconcile the variances noted in the two records in order to reflect the correct figure on the FMIS.

Management Comments No comments received 19.56 VAT Reconciliation All payments, including VAT, must be immediately recorded in the financial management information system or Expenditure Ledger.35 Audit examination of VAT returns and the FMIS revealed differences.

Refer to the table below for details.


35 Finance Instruction 2005 Section 20 Ministry of Health Section 19: Page 52 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Ministry of Health VAT Output calculated by Audit VAT Output under FMIS for 2007 Variance Amount $ 16,033,293 17,923,942 1,890,649 The VAT figures under FMIS is overstated when compared to VAT figures calculated audit.

A number of discrepancies were also noted in relation to preparation of monthly VAT returns.
• • • • There was a computation error for the month of January 2007, total output tax should have been 1,069,804.04 but was recorded instead as 1,066,636.82, thus total output tax was understated by $3,167.22.

Similarly, there was a computation error for the month of February, where the total output tax should have been 1,600,299.13 but was recorded instead as 1,596,837.04, thus total output tax was understated by $3,462.09.

The total output tax for the month of March was shown as only $8,081.58.
Audit is of the opinion that this amount is grossly understated, as Ministry’s monthly average expenditure is about $12 million and the output tax would be around$1.3 million.

Audit noted that VAT refunds for the month of July and August amounting to $3,147,405 and $4,911.43 were not captured in the FMIS.

The failure of the Ministry to carry out proper preparation of VAT returns has meant that there is ambiguity in the correct calculation of VAT to be paid and the VAT amount recorded in the FMIS.
Recommendations • The Ministry should ensure that vat calculations are properly carried out and that the correct amounts are entered into the FMIS system.

• The refund to be received by the Ministry for the months of July and August are to be properly accounted for in the FMIS records.

• Supervisors of officers preparing the VAT returns should properly scrutinise the VAT returns and ensure that these are accurately filled and submitted to FIRCA.
Management Comments No comments received Ministry of Health Section 19: Page 53 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 19.1: Pending Surcharge Cases General Administration 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures Value Added Tax 2007 $ 2006 $ 2,992,139 325,300 886,897 890,793 1,239,800 4,249,892 1,212,561 11,797,382 2,862,500 345,423 1,141,269 1,116,266 1,198,303 3,799,519 991,959 11,455,238 --- 120,866 --- 120,866 --- 143,601 1,000,000 1,143,601 952,666 1,057,884 TOTAL EXPENDITURES 12,870,914 13,656,724 Research 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 117,640 157,627 21,746 42,547 100,993 --- 60,000 500,553 --- --- --- --- 108,261 117,458 54,707 41,573 127,831 --- 260,873 710,703 --- --- --- --- Value Added Tax 80,313 121,670 TOTAL EXPENDITURES 580,866 832,373 Ministry of Health Section 19: Page 54 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Urban Hospitals 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 40,322815 9,721,407 918,207 3,176,704 8,115,389 --- --- 62,254,522 36,525,326 8,688,300 986,657 3,234,740 5,795,770 --- --- 55,230,793
 2,862,700 845,613 --- 3,708,313 1,662,780 1,334,861 --- 2,997,641 Value Added Tax 8,553,729 7,595,673 TOTAL EXPENDITURES 74,516,564 65,824,107 Divisional Hospitals, Health Centres and Nursing Stations 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 23,884,185 4,100,383 787,036 1,640,678 1,149,718 --- 110,000 31,672,000 22,847,526 3,303,500 797,383 1,771,784 716,130 --- 107,501 29,543,824 551,182 1,104,148 --- 1,655,330 1,149,535 1,157,281 --- 2,306,816 Value Added Tax 4,315,025 4,047,662 TOTAL EXPENDITURES 37,642,355 35,898,302 Ministry of Health Section 19: Page 55 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Public Health Service 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 1,663,251 24,535 15,800 33,300 679,817 356,939 573,799 3,347,441 1,940,842 24,891 31,093 10,051 1,172,151 462,717 480,310 4,122,055 --- --- --- --- --- --- --- --- Value Added Tax 1,259,154 566,643 TOTAL EXPENDITURES 4,606,595 4,688,698 Drugs and Medical Supplies 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 612,662 343,100 60,231 119,235 10,386,091 --- --- 11,521,319
 560,999 277,317 67,736 172,109 13,071,006 --- --- 14,149,167 --- --- --- --- --- --- --- --- Value Added Tax 2,045,187 2,315,731 TOTAL EXPENDITURES 13,566,506 37,264,898 Ministry of Health Section 19: Page 56 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Hospital and Support Service 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 97,400 476,700 10,000 2,202,299 7,500 --- --- 2,793,899 96,600 536,020 16,568 2,360,723 7,731 --- --- 3,017,642 --- --- --- --- --- --- --- --- Value Added Tax 324,086 318,467 TOTAL EXPENDITURES 3,117,985 3,336,109 Fiji School of Nursing 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 1,433,160 573,010 38,065 261,552 525,000 --- 40,000 2,870,787 --- --- --- --- 1,713,799 473,053 42,022 195,716 465,421 --- 37,013 2,927,024 89,601 --- --- 89,601 Value Added Tax 308,650 364,882 TOTAL EXPENDITURES 3,179,437 3,381,507 Ministry of Health Section 19: Page 57 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Old People’s Home 2007 Description EXPENDITURES Operating Established Staff Unestablished Staff Travel & Communication Maintenance & Operations Purchase of Goods & Services Operating Grants & Transfers Special expenditure Total Operating Expenditures Capital Capital Construction Capital Purchase Capital grants & Transfers Total Capital Expenditures 2007 $ 2006 $ 79,201 429,753 5,820 49,800
 66,200 --- --- 630,774 --- --- --- --- 69,119 412,690 5,003 49,685 51,755 --- --- 588,252 --- --- --- --- Value Added Tax 85,132 65,940 TOTAL EXPENDITURES 715,906 654,192 Ministry of Health Section 19: Page 58 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 19.2: Overpayment of Salary on Resignations Name EDP # Division Jyotika Devi Shaleen Chand 62271 32812 CWM Hospital Ba Hospital Rehana Ali 34053 Vunisea Hospital Prem Chand 46704 Lautoka Hospital Mere Tataka 31246 Lautoka Hospital Duraga Naidu Sakina Mohammed 33240 9618 Ba Hospital CWM Hospital Ldua Bornmon 63787 FSN Mereseini Joritani 64488 FSN Comment Amount $ 937.61 30 days short notice.
1,710.11 Advise on resignation – from submission Late CEHS.

5,989.33 Deemed to have resigned w.e.f.

22/02/07.

383.13 Deemed to have resigned w.e.f.

20/02/07.

181.48 Short notice w.e.f.

08/03/07 resignation 1,174.12 30 days short notice.

712.88 Short notice of resignation and late cession of salary.

845.20 Short notice of resignation and late cession of salary.

798.25 Short notice of resignation and late cession of salary.
Dhirendra Lal 46907 Sigatoka Hospital 606.62 Short notice of resignation Shyauli Saleshni Prasad 33597 60326 Nadi Hospital Lautoka Hospital and late cession of salary.

1,156.48 30 days short notice.

17.70 Deemed resignation w.e.f.

10/07/07.

Asena Taga 33959 Nabouwalu Hospital 1,077.82 Deemed resignation w.e.f.

01/07/07 Josaia Maka 45652 CWM Hospital 3,980.84 Deemed resignation w.e.f.

Devika Chand Aniniasi Tarui 58001 60832 Nadi St. Giles Hospital Laisani Sikivou 53984 NCHP 20/08/07.
899.00 Resigned w.e.f.

29/09/07.

548.75 Deemed to have resined w.e.f.

12/09/07.

Absent from work.

866.43 Deemed to have resined 20/07/07.

for w.e.f.

unauthorised more than 7 days.

leave Luseyare Ligabalau 18899 Head Office 654.41 Overpayment upon Lenikeli K. Rafaele 32496 CWM Hospital Brandon Brandly Total 61267 CWM Hospital resignation.

3,501.28 Addition of overpayment balance and short notice of 30 Deemed resignation w.e.f.

07/09/07.

days.

519.53 Short notice of 30 days.


26,560.97 Ministry of Health Section 19: Page 59 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 19.3: Disciplinary Cases - No action Taken.
EDP #/ LPO 64359 Name Naushad Buksh Substantive Post Clerical Officer at Health -HQ 45858 Matai Matakitoga General Manager Corporate Service Health Staff #: LPO 48374 8/18/2006 Health Staff #: LPO 36150 10/28/2005 Health Staff #: LPO 36150 10/28/2005 Irregularities Action taken Forging and assisting companies $38,442 worth procurements quotations fraudulently associate with of Authorised $54,661 to J.J Roedan Ace and $4000, to SDA youths without any authority.
LPOs worth Split whilst repairing a Dental Caravan GM 385 at Marine Motors for $11,890 Paid Raiwaqa Buses Limited for cost for hiring of 60 seater bus taking for Ministry Choir for the Methodist Church Annual Conference from Suva/Nausori/Suva wef 18/8/06 for $250.

Paid Siteri’s Catering Services for cost of providing: Catering Services for Ministry of Health's Sports on (Dinner Day.

29/10/05 700 for people x $7.50 & Lunch for 400 people x $7.50) = $8250 X 50% = $4125.
Paid Siteri’s Catering Services for MOH Sports Day.

(2x$245.00) Officer reassigned from FPS to HQ in Audit check 2008 No recovery made for losses and no disciplinary action taken against the officer.

Current post Clerical officer at Health-HQ No action taken to date No action taken to date.

Surcharge was recommended No action taken to date.

Officer had resigned from Ministry 2008. the in No evidence of recovery.

No evidence of recovery.


We agree to recover the cost of the bus from Committee members responsible for this social event.

We agree to recover money from expended those officers responsible.

No evidence of recovery.

We agree to recover money from expended officers those responsible.
Ministry of Health Section 19: Page 60 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Name Health Staff Substantive Post EDP #/ LPO LPO 40177 16/2/2006 #: Health Staff #: LPO 30728 11/8/2005 14623 Senior Health Inspector Gyan Prakash (officer authorized the at repairs Jeral Auto Service Pharmacists at the Labasa Hospital Irregularities Action taken Further investigation will be conducted to determine as to why PSC was not advised and of cost the repairs to be met from “Office Accommodation” vote.
Officers found responsible will be surcharged as recommended.

We agree that the amount is to be recovered from the officer’s salary we will communicate with your office further on this.

Your comments are noted.

The Ministry’s Disciplinary Committee has the examined issues raised with a view of taking disciplinary action the responsible.
against officers in of Paid Life Insurance Corporation of India for damages to the the partitions LICI staircase Building during central/eastern health services renting of the premises.

The loss was $480.

of Paid Lalas Store for cost providing legal court lawyers legal for uniform officers of Ministry of Health.

The cost incurred was $685.


Three Leco 3 (mosquito spraying) machines used by Health Officers were taken to Jeral Auto Services on 2/11/06 for repairs.36 The company was paid $2,700 on 20/12/06 but it was revealed that none of the three machines have been repaired date.
Jeral Auto Services ceased operations in early 2007. to The non adherence the cold chain to lack of policy and the awareness of policy resulted in the the damages totaling vaccines thus $39,272.52, wastage of public to to We agree further query officers on duty that during particular Sunday determine the whether damages could to Current post in Audit check 2008 investigation No was conducted and no officer was surcharged.
No action taken No action taken No action taken 36 LPO number 51716 Ministry of Health Section 19: Page 61 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 EDP #/ LPO Name Substantive Post Irregularities Action taken Audit check 2008 in Current post 18901 Penina Cirikiyasawa Principal Admin Officer Tamavua Garage Mechanics No action taken to date.

Resigned from Ministry 2008. the in investigation No was conducted.

have been avoided and not to due “negligence of duty”.
Should it be proven, as “negligence” appropriate disciplinary action will be against taken those responsible.

to the Management said they would further investigate determine officers for responsible advance the payment and take appropriate disciplinary action.

Your comments are noted.

This will be covered full under the Investigation to conducted.

be found Officers and negligent were who for responsible the “losses” will be disciplined.

funds.
funds.

-Failed to enter into a contract with Falekau South Pacific Limited.

-Advance payments of $100,000 were made with the first $60,000 on 13/01/05 and on $40,000 27/09/05.

As reported in the report, 2006 audit some vehicles parts had gone missing for taken whilst private at repairs garages, refer below for details: GN132 was repaired Shika Motors at was where discovered that $4,414.75 worth parts were missing.
it GL064 was parked at Marine Motors and upon dismantling at the Tamavua garage it was discovered that parts were missing.

CO362 had parts missing when take to for Shika Motors Ministry of Health Section 19: Page 62 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 EDP #/ LPO Name Substantive Post Irregularities Action taken Audit check 2008 in Current post Tamavua Garage Mechanics repairs.

The 2006 audit report highlighted cases of cannibalizations of vehicle parts.
Audit that noted $9,079.00 worth of tools and machines from were missing the Garage.

Your comments are noted.

This will be covered full under the to Investigation conducted.

be found Officers responsible for alleged the cannibalization of motor parts will be disciplined.

Your comments are noted.

We will your keep office updated once a Board of Survey is completed and appropriate action taken on all missing tools mentioned.

investigation No was conducted.


No board of survey carried out at the Tamavua Garage and no one was responsible held the missing for worth tools as $9,079.00, audit again verified that tools the remained unaccounted for in march, 2008.

Ministry of Health Section 19: Page 63 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 19.4: Non Compliance with Health Finance Manual.

Criteria 2.1.5.
Criteria 2.1.5.

The Senior Manager Finance must maintain a Virement Register, which should contain the following information: i. ii.

the serial number; the budgetary allocation to which and from which the transfer of funds is being made; the amount amounts of the budget allocations; the date of approval.

transferred and the revised iii.

iv.

2.8.13 Each month, the Senior Manager Finance must provide a signed and dated report to the Chief Executive Officer to advise: (a) (b) 4.5.1.
Whether all reconciliations and checks required in the agency’s Finance Manual have been carried out; and the current status of any unresolved external or internal audit issues.

The salaries officer must record the distributed cheques in a cheque distribution register that shall include the following details: i. ii.

date of distribution; amount distributed and to which location (including registered mail number); iii.

cheque number and name of payee.


Officer Responsible Status Roneel in Kept System, however, (ii) & (iii) not stated in records.

Mrs Sauroutu Not carrying out the task Makereta c/- Salaries Department Carried out.

However, (i) date not recorded (ii) Registered mail number not noted.

5.6.1.

The Accounting Head shall maintain a revenue collectors’ chart to monitor the regularity of revenue lodged by the revenue collectors.

Sangeeta Maintained station ways.

(i), (iii) & (iv) not noted in chart.

5.6.2.


The chart will outline the following information: i. name & designation of each revenue collector; ii.

iii.

iv.

the station where each revenue collector is based; frequency of revenue submissions made to head office; frequency of lodgments made to the bank.

7.1.4.
7.1.4.

The safe keeper shall maintain a safe register which should contain the following information: i. date and amount of cash/cheques deposited into or withdrawn from the safe; type of cash deposited, whether petty cash or revenue collection; date, cheque numbers and value of cheques in the safe; ii.

iii.

cashier None maintained.

Ministry of Health Section 19: Page 64 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Criteria Officer Responsible Status iv.
other valuables such as unused or partly- used receipt books or cheque books and their serial numbers.

7.3.14.

The petty cash officer shall enter details of payments the cashbook and attach duplicate into made vouchers.

10.1.7.

The accounts officer must also record the travel advance in the debtors register in accordance with Part 9 of the Manual.

Kesa Done, duplicate vouchers maintained by Kesa but not attached in the cashbook.

Ilaitia No, not recorded.

11.1.1.


All assets acquired with a cost in excess of $2000, shall be recorded in a fixed assets register.

Mrs Sauroutu No register available 11.2.2.

The Manager General Services / Manager Personnel shall ensure that items valued at less than $2000 but more than $200 is recorded in an expendable items register.

The register shall contain the following information: Roneel No register.

i. ii.

iii.

iv.
i. ii.

iii.

iv.

if it was date of purchase (including acquired by transfer, gift or second-hand); purchase reference number; description of items and quantity; disposal method (whether written off, sold, etc.)

and reference number.

12.3.14.

The accounts officer shall enter details of the fuel order forms into a fuel order register.

Once the fuel charges advice has been submitted by the Public Works Ministry, the cost shall be entered into the register against the relevant entry.

13.2.1.
13.2.1.

A separate register shall be kept for annual leave for each employee.

The register shall record: i. ii.

iii.

dates and number of leave days taken; the date leave becomes due; balance of accumulated leave.

13.4.1.

The Accounting Head shall maintain a register of in accordance with Finance liabilities contingent Instruction 64-(1).

14.1.1.

A copy of the loss report must be submitted to the Manager Finance who shall record details of each loss in the Losses Register.

15.3.1.
15.3.1.

The trust officer shall keep a trust ledger to record movement of trust money.

The ledger shall record the following information: i. name of trust account; Samu Not maintained.

HRM section Not maintained.

Mrs Sauroutu Not kept Mrs Sauroutu Not kept Ilitia Pending for 2007.

The date of points; ii and iii not in the ledger.

Ministry of Health Section 19: Page 65 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Criteria Officer Responsible Status ii.

iii.

iv.
iii.

iv.

date and amount of receipts and payee; date, amount paid and payer including reference number; balance to date.

15.4.1.

Within 5 days after the end of each month, the trust officer shall prepare a trust reconciliation to reconcile trust account balances to the ledger total and the trust bank account.

15.4.5.

Each year the trust officer shall prepare an annual trust receipts & payments statement within two weeks of the end of the year.

16.1.1.
16.1.1.

A journal voucher register must be maintained by the Accounting Head or accounts supervisor to record all journal vouchers raised during the year.

The register shall provide the following information: date and voucher number; i. purpose of raising voucher; ii.

amount on voucher; iii.

account codes debited or credited.

iv.

Ilitia Not done.

the All months’ reconciliation was done right at the end of the year – Dec 07 and in early 2008.

Ilitia Never practiced Bijen Done but not updated.


Records only up to 20th August 2007.

17.1.5.

17.1.6.

17.3.1.

Within 1 week of the end of each month, the Accounting Head shall submit to the Deputy CEO the internal control report.

Mrs Sauroutu Not carrying out task viii.

The report shall provide the following information; whether all reconciliations are up to date; vi.

whether financial information required by vii.


the Ministry of Finance has been submitted on time; whether stock takes of physical assets, inventory and money have been carried out as and when required; the status of unresolved audit issues; improvements in internal control, such as rotation of duties between staff, that .have been implemented or are proposed.

ix.

x.

The Accounting Head shall certify all financial reports that must be submitted to the Ministry of Finance.

These reports include: i. ii.


weekly & monthly cash flow forecasts; drawings monthly reconciliation Idrish Not done statements; monthly expenditure & commitment reports; revolving fund, inter-departmental iii.

iv.

Ministry of Health Section 19: Page 66 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Criteria Officer Responsible Status clearance and cash clearance reports; v. vi.

vii.

viii.
vii.

viii.

quarterly TMA performance reports; quarterly overdue debt reports; quarterly write-off reports; quarterly vehicle reports Ministry of Health Section 19: Page 67 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Appendix 19.5: Failure to Carry Out Specified Duties Area Unaccomplished Task Status RFA- Miscellaneous No reconciliation from January 2007 MOH sponsored Students No 2004-2005 cost report.

Incomplete training register.
Motor Vehicle BOS report for written off vehicle Absenteeism Return Quarters Report Updating Leave Schedule of Non submission from respective stations to HQ Quarters repair/renovation Leave schedule for expatriate doctors not nurses and updated/medical officers under Trust Ledgers Fund Updated ledgers not provided Submitted up to January 2007 Not submitted to audit Incomplete records Not submitted to audit Report incomplete Report incomplete Incomplete 2007 updates not provided Officer Responsible Supervising Officer Ilaitia Q Idrish Khan Peni Tikoca Emele Wara Alipate Gonerogo Adi Litia Komaisavai Adi Litia Komaisavai Luisa Vulaono/Aliti Tuimalo Ilaitia Q Emele Wara Jokatama Ravono/Emele Wara Jokatama Ravono/Emele Losana Ugavule/Adi Litia Komaisavai/Jokatama Ravono Idrish Khan Wages Reconciliation 2005 – 2007 reconciliation for HQ was not prepared Not submitted to audit Tres Salaries Reconciliation Pay 25 and 26 reconciliation for 2007 not done Not submitted to audit No one in charge for the year Laisa Laisa Annual Board Of Survey Last board of survey in 2004 Not submitted to audit Ilisoni Tokalaulevu Idrish Khan Appendix 19.6: Summary of Payments Made To the Private Garages: 2005 To 2007 Vendor Name Agent Date of Payment Span Aarkay Motors Limited Professional Brothers Avondale Motors Fiji Ltd Kritika’ Motor Repairs Jhokesh Motors S K Davey Ltd Jeral Auto services Carpenters Motors Shika Motors Repair Dynamo Electric Company Titus Motors Marine Motors Ministry of Health February 2005 to July 2007 July 2006 to November 2007 May 2005 to October 2007 September 2006 to December 2007 February 2007 to September 2007 January 2007 to August 2007 July 2005 to December 2006 March 2005 to November 2007 November 2005 to November 2007 January 2005 to December 2007 May 2006 to October 2007 April 2005 to December 2007 Nissan Amount $ 36,316.98 8,771.50 6,520.00 32,251.46 21,675 12,344.29 41,591.34 27,341.77 84,795 32,560.87 108,441.00 212,159.18 Section 19: Page 68 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI
 ISLANDS – OCTOBER 2008 Vendor Name Agent Date of Payment Span Niranjans Asco Motors Nivis Motors Total Mazda Toyota Mitsubishi January 2005 to December 2007 December 2005 to December 2007 January 2005 to December 2007 Amount $ 133,925.15 181,429.21 179,265.88 1,119,388.63 Appendix 19.7: Repetition of Repairs on Ministry Vehicles Vehicle Number GM563 Invoice LPO Company Particulars 89224 50182 Titus Motors 120718 61688 Titus Motors Please carryout mechanical repairs and undercarriage for Navua Hospital vehicle GM563 To carry out mechanical repairs and body work for Serua/Namosi Subdivision vehicle for GM563.
Date 18/10/2006 Amount $ $6,326.00 25/10/2007 $4,670.44 GM004 37847 29190 59183 38207 63074 38821 69083 42097 73780 44070 75957 45342 78005 46105 98301 54447 GN268 113887 62831 128659 69325 Ministry of Health Dynamo Electric Company Dynamo Electric Company Dynamo Electric Company Dynamo Electric Company Dynamo Electric Company Dynamo Electric Company Dynamo Electric Company Dynamo Electric Company Marine Motors Marine Motors Checking and Repairs of electrical system for vehicle # GM109 Payment for electricity work carried out for vehicle # GM109 Checking and Repairing Electricity Faults for vehicles # GM004, GM127, GM109 and GM296 Repair of Electricity Faulty for the vehicle # GM004 Charges for Checking Electrical System of vehicle # GM109 which engine did not respond due to faulty Repair of Electrical work for vehicle # GM296 and GM109 which was not able to start due to power failure.
Repair of Electrical work for vehicle # GM004 which was not able to start due to power failure Repair of Electrical Fault for vehicle # GM109 as per invoice # 0376 Please repair of engine, replacement of mechanical parts for CWMH ambulance GN268.

11/05/2005 $156 05/12/2005 $320 17/01/2006 $268 27/03/2006 312.75 18/05/2006 $326 15/06/2006 $477 30/06/2006 $326 24/01/2007 $318 14/08/2007 $4,200 Repair of Ambulance engine.
07/02/2008 $4,580 Section 19: Page 69 Audit comments It was noted that within one year, there was body work and mechanical repairs carried out again this for vehicle and would only be done if the repairs previous were not carried out properly.

It was noted that Dynamo Electric was Company repairing the electrical faults on a GM004 of number occasions and the authenticity of the repairs was questionable and were charges exorbitant.
on vehicle’s This was engine twice repaired within 6 months and exorbitant costs charged.

REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Invoice LPO Company Particulars Vehicle Number GM295 93144 52181 99188 54813 GN173 97439 52284 Marine Motors Marine Motors Titus Motors Jeral Auto Service Being cost of providing: General Body Work for Vehicle No.

GM295 used by HQ.

Being cost of providing general mechanical and maintenance to GM295.
Repair of under carriage and chassis wielding.

Being cost of providing: Repairing & General Servicing & Towing charges from Verata/Nausori Police Station to Suva (Garage) of Vehicle No.

GN173.

Cost for general repair and service for vehicle GN173.

Date 23/112006 Amount $ $3,800 08/02/2007 $2,319.79 04/09/2008 $1,260.00 28/12/2006 03/05/2007 $ 5,529.38 $4,440 Audit comments This vehicle was repaired for body work etc every year and it raises serious doubts of of the quality repairs and its authenticity.
This vehicle had an accident and was repaired first at Auto Service and then at Jhokesh Motors which costed over $9,969.38 for the accident.

Jeral 105068 57937 Jhokhas Motors Appendix 19.8: Issues of LPOs for Additional Repair Works.
Invoice LPO Company Particulars Date Vehicle Number GL842 114887 61658 117516 64502 GM840 85274 48573 87845 49293 GM 549 74912 43658 82285 46957 GM296 125634 67522 127606 68583 Shika Motors Shika Motors Titus Motors Titus Motors Marine Motors Marine Motors Kritika Motors Kritika Motors For the repair of CWMH vehicle No: GL842.

Repairing of vehicle # GL842.


Please install a second hand engine and engine accessories for Levuka Hospital Ambulance Replace second hand TD27 engine and gear mounting and other mechanical work.

Please provide general painting, undercarriage, repairs, upholsting and all electrical works for Levuka Hospital Ambulance registered GM840.

Being cost of providing: Repairing of Vehicle No.

GM549 Being cost of providing: General repairing of Vehicle No.

GM549.
GM549.

Being charges for engine overhaul, removal & replacement of engine, remove & service fuel pump injectors for CWMH vehicle GM296.

Maintenance and mechanical repair for CWMH vehicle GM296.

Amount $ $2,866.00 23/08/2007 21/09/2007 $854.80 09/09/2006 $8,987.00 06/10/2006 $8,897.00 Audit Comments This was vehicle initially send to Sihka motors for repair with LPO 61658 issued and whistled at the garage, was 64502 LPO issued.
LPO 48573 was issued for the installing second hand engine at Titus Motors; another LPO 49293 was issued for further work.

02/06/2006 09/08/2006 $4,250.00 $4,875.00 11/12/2007 $3,037.50 15/1/08 $3,334.84 LPO 43658 was issued initially but whilst work continued at Marine Motors another LPO 46957 was issued.

This vehicle was at from Kritika Motors November to 9/1/08.

(this is when two LPOs were the issued).


2007 Ministry of Health Section 19: Page 70 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Invoice LPO Company Particulars Date Vehicle Number GL064 111851 61202 118483 64582 Jhokesh Motors Jhokesh Motors Cost for general body works and mechanical repairs on GL064 ambulance.

Cost for general maintenance and electrical work for GL064.
Amount $ $7,976.00 19/07/2007 28/09/2007 $1,800.00 Audit Comments The Initial LPO 61202 was issued for repairs and then another LPO 64582 was issued whilst the GL064 was still at Jhokesh Motors for the first repairs.

Appendix 19.9: Items Out of Stock as at 31/12/07 Item No.
Description Minimum Stock Level Appliance 00713 00824 00870 01155 01158 01203 Consumable Dressing 00247 Electrode Chest Infant 31118733 Tourniquet Adult Warming Blood Infusion Coil Forceps Artery Plain” Urinal Male Urine Collectors Paediatric Sterile 100ml Keto-Diastix Strips Bottle of 100 Strips Uristix Strips 100 Bag Clostomy 30mm hole diameter, size 140 *210m Blade surgical Scaple No.11 sterile individually wrapp Cannula Umbical 6ft *35cm, Sterile individually wrapp Catheter Foley Silicon treated 14FG, Sterile,Individually wra Catheter Foley Silicon treated 16FG, Sterile,Individually wra Catheter Foley Silicon treated 20FG, Sterile,Individually wra Catheter Peritoneal Dialysis Set, Adult (Tenckhoff) Catheter Suction Sterile PVC 16FG fingertip control Catheter Suction Sterile PVC 20FG fingertip control Catheter Urinary OD 1.32mm, Sterile, (Ureteric Blue.. Catheter Urinary OD 1.32mm, Sterile, (Ureteric Red.. Catheter Urinary OD 2.00mm, Sterile, (Ureteric Blue.. Catheter Urinary OD 2.00mm, Sterile, (Ureteric Red.. Connector Polythene Straight ID 4.5mm OD 6mm Gloves Disposable Examination, Latex, Amidextrous, Needle scalpvein set 23G *19mm Spigot catheters Large Suture Silk 2/0 45cm, 24mm rev cut half circle Needle Suture Catgut Chromic 4/0 75cm,20mm taper pt half Suture Catgut Chromic 3/0 75cm,26mm taper pt half Suture Nylon Monofilament 11m, 40mm Rev Cut 3/8 Tube Feeding infant 8FG Tube Levin D/Ryles (Duodenal Catheter) 8FG Tube Levin D/Ryles (Duodenal Catheter) 10FG Tubing sheeting drainage corrugated 250*30mm radia.. Y Irrigation Set Cord Clamps Umbilical Sterile Gloves Surgical Sterile Latex Size 7, pair Suture Chromic Gut 1 75cm 40mm Taper Paoint Half Plastic Spray bandage 100g Leuko Spray Dressing Ministry of Health Section 19: Page 71 3,251 159 20 63 12 821 459 1,727 581 6,836 312 1,628 1,899 846 26 1,374 20 14 6 9 12 30
 4,355 2,390 65 242 243 245 51 2,024 111 17 100 5 10,316 28,328 191 75 REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Item No.
Description Minimum Stock Level 00453 00463 Drugs Gauze Absorbent BP 90cm*100m 40*40 19*15 Hypoallergenic microporous tape 5cm * 9m Vitamin K(1) inj 1mg/1ml Acetazolamide Tables 250mg Benzoyl Benzoate lotion 25% Benztropine Tablets 2mg Betamethasone-Neomycin Eye Oinment 0.1 %/0.5% Busulphan Tablets 2mg Ceftriaxone Injection 250mg Chlorhexidine Gluconate Solution 20% w/v (4.5L) Chlorhexidine Gluconate Cream 1% 500ml Bottle Chlorhexidine Cetrimide Solution 1.5/15% 500ml Chlorambucil Tablets 5mg Chlorpromazine Tablets 50mg Dexamethasone Tablets 500mcg Diazepam Tablets 5mg Digoxin Elixir 50mcg Econazole Cream 1% Ethambutol Tablets 400mg Ethosuximide Capsules 250mg Ferrous Gluconate Elixer 200mg/5ml Folinic Acid Injection 3mg/ml Folinic Acid Injection 3mg/ml Glyceryl Trinitrate Oinment 0.5% Paraldehyde Injection Pencillin Procaine Injection 4 megaunit Pencillin V syrup 125mg/5ml Pethidine Injection 100mg/2ml Phenobarbitone Tablets 60mg Piperacillin Injection 1g Prilocaine Injection 4% Cartridge Vial Primidone Tablets 250mg Pyridoxine Tablets 25mg Sodium Chloride Injection 0.9% Ampule/20ml Tamoxifen Tablets 20mg Thiamine HC1 Tablets 100mg Thiamine HC1 inj 100mg/2ml Thioridizine Tablets 100mg Thyroxine Tablets 100mcg Thyrozine Tablets 50mcg Vecuronium Injection 10mg Verapamil Tablets 40mg Water for inj 100mls Phenylepherine eye drop 10% Arabinocide-C (Cytarabine) Injection 100mg Potassium Chloride (sugar free) Mixture 5mmol/5ml Fluphenazine Tablets 5mg Bismuth in Lodoform Paste (BIPP) ointment 50mg Trimethoprim Trimethoprim Suspension 50mg/5ml Paracetamol Suppository 500mg Ipratropium Bromide solution 0.025% Sodium Chloride Injection 20% Tubes Kehrs Drainage 10FG Ministry of Health Section 19: Page 72 831 11,103
Ministry of Health Section 19: Page REPORT OF THE AUDITOR GENERAL OF THE REPUBLIC OF THE FIJI ISLANDS – OCTOBER 2008 Item No.
Description Minimum Stock Level 01185 01872 02110 32629 00135 00188 X-Rays 01335 01342 01345 01353 01388 01405 01408 01442 32479 32581 Compound Tragacanth Pulv BP 100g (Tragacanth 15g) Zidovudine Syrup 50mg/5ml Vinblastine Injection 10mg Vitamine A (RETINOL)) 200,000 I.U Capsules (USP) Fusidic Tablets 250mg Melphalan Tablets 5mg Envelopes X-Rays Brown Kraft 125gsm 14.5 x 7 Ultrasound Gel 500ml Film Single sided emulsion CT Scanner 11” x 1 Dark Room Safe Lights X-Ray Cassettes with screens (curix) 30 x 40cm Chemical X-Ray Developer G150 4 LITRE Chemical X-Ray Fixer G354 2.5 Litre Sodium and Meglumine Diatriazoate Infusion Injection Thermal Paper (Sony Superior Density Printing CT Syringe 200mls 36 2 8 1,500 161 188 2219 275 20 8 0 0 0 80 17 250 Appendix 19.10: Meal Claims and Overtime Paid to Health Inspectors by the Ministry Name Saula Matakarawa Petero V L Nicky Prasad Penioni Matadigo Alumeci Vularika Henry Hae Sokraa Aminiasi Tavui Railala Vakaloloma Nakabe Vakaruru C Vatukela Rakesh Chandra Poasa Tuinakelo Sangeeta Mala Wilson Singh Sofaia Tatatau Total Meal Claims 2006 $ Meal Claims 2007 $ Overtime Claims 2006 $ Overtime Claims 2007 $ 815 687 374 639 855 879 801 768 726 402 817 30 443 421 8,657 765 761 477 612 1,032 908 525 395 908 4,820 --- --- Total $ 9,847 9,808 8,123 10,098 14,543 14,012 10,673 9,869 9,628 12,194 6,908 3,772 7,282 11,536 138,293 Ministry of Health Section 19: Page 73