Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697769832030.pdf (Fiji)
LIST OF WITNESSES WRITTEN EVIDENCES Report of the Auditor General – 2017 Audit Report on Infrastructure Sector: (Parliamentary Paper No.

10 of 2019) No.

Witnesses 1.

Office of the Auditor General (Supplementary Response) 2.

Ministry of Infrastructure and Transport Page No.

3 10 2016-2017 Financial Year: Volume 5 Infrastructure Sector – Government Ministries and Departments 1.

Head No.

40 – Ministry of Infrastructure and Transport 2.

Head No.

41 – Water Authority of Fiji 3.

Head No.


43 – Fiji Roads Authority OFFICE OF THE AUDITOR GENERAL Promoting Public Sector Accountability and Sustainability through our Audits 6-8TH Floor, Ratu Sukuna House 2-10 McArthur St P. O.
Box 2214, Government Buildings Suva, Fiji Telephone: (679) 330 9032 Fax: (679) 330 3812 E-mail: info@auditorgeneral.gov.fj Website: http://www.oag.gov.fj File: 102 20 December 2020 The Honorable Alvick Maharaj The Chairperson Standing Committee on Public Accounts Parliament Complex Gladstone Road SUVA.

Dear Honorable Maharaj Supplementary Response – 2016-2017 Audit Report on (Parliamentary Paper No.
10 of 2019) Infrastructure Sector Reference is made to your letter dated 15 December 2020, seeking explanation on the consolidation of Water Authority of Fiji (WAF) and Fiji Roads Authority (FRA) receipts and expenditure with the Ministry of Infrastructure and Transport audit report.

In accordance to the budget estimate, the Ministry of Infrastructure and Transport is responsible for the policy and legislative formulation and the administrative and regulatory functions of WAF and FRA.
The Ministry provides the capital and operating grants under Head 41 and 43 to WAF and FRA respectively.

Thus, the audit report on Infrastructure Sector reports on the disbursement of the grants to WAF and FRA by the Ministry of Infrastructure and Transport.

The detail audit of the financial performance of WAF and FRA are done separately and included under the Auditor-General’s Report on Statutory Authorities.

We trust that this explanation is sufficient as per your request.
For any further clarification, please contact the undersigned on telephone 3309032.

Yours sincerely Moshin Ali for AUDITOR-GENERAL Ministry of Local Government No.

PAC Question Departments Response on Current Status 37.21 Main Trust Journals Not Approved.

Are the journals being approved now?

Yes, with the recruitment of the Manager Finance, all journal vouchers are now endorsed before adjustment is posted into the FMIS system.
Current OAG Comments The OAG to provide feedback on the response of the Ministry to the question.

OAG confirms that the control around approving of journal vouchers have largely improved compared to 2017 financial year.

Ministry of Infrastructure, Transport, Disaster Management and Meteorological Services No.
40.14 PAC Question Part A; Section 3: Audit Opinion Adjustment for VAT not supported Why were appropriate supporting documents not provided to Office of the Auditor General for journal entry that was passed to resolve the variance between the VAT as per Ministry's records and Fiji Revenue Customs Services ?
Qualification number 2; The Ministry adjusted its VAT receivable balance by $322,428 to reconcile it with the Fiji Revenue Customs Services records by posting journal entries to the TMA Accumulated Surplus Account.

I was not provided with appropriate reconciliations to support these journal entries.

As such, I was unable to satisfy myself on the accuracy of these journal entries posted to the general ledger and its impact on the accounts affected.
Departments Response on Current Status All relevant documents that were available in the office were provided to OAG.

All previous accounting records were confiscated by FICAC during their investigation thus the supporting documents could not be provided to the auditors.

Current OAG Reponses OAG to provide update on this issue in relation to the Ministry’s response.

The Ministry is yet to resolve the issue on adjustment for VAT not supported.
Efforts was made to retrieve details from FMIS however records prior to 2014 could not be retrieve from FMIS.

SAO and A/AO were advised by AMU on 10/0/17 to liase with FIRCA on reconciling at VAT account.

AMU had advised to reach an agreement with FIRCA for any necessary adjustment.

VAT reconciliation was done in conjunction with FRCA which resulted in necessary adjustment being made with FRCA.

Appendix 2 attached 4012 Anomalies in Joinery and Plumber Shop Sales (DEWCE) 1.
The Division currently ensures that all sales records are properly maintained with all source documents.

OAG to provide update on this issue What has the Ministry done to improve internal controls over plumbing shop inventory and TMA Plumbing Sales?

2.

JRS is issued for all funds received for works to be carried out which is supported by relevant source documents.

The Ministry has largely addressed the internal control issue in the Central Eastern Division.
However, our 2019 Current OAG Reponses audit has noted similar internal control issues in the western division.

No.

PAC Question Departments Response on Current Status 3.

The Division currently ensures that relevant supporting documents are attached to the JV’s.

4.

Receipts posted to sales in FMIS are reconcile with JRS.

5.

Previously posting was done at month end, however for the current financial year, sales will be receipted on FMIS as and when the JRS issued.
Monthly reconciliations have now been implemented with JRS and FMIS.

is The Ministry does not have a proper accounting system for recording of TMA sales for Joinery and Plumbing which totaled $976,930 and $1,028,719, respectively as at 31 July 2017.

Moreover, our audit could not ascertain whether all revenue earned were properly recorded in the general ledger as supporting documents relating to revenue were not adequately maintained.
these It was further noted that although the Ministry has Job Record Sheets (JRS) and invoicing system is in place, the total amount as per these records did not reconcile with the total revenue.

A variance of $185,909 between the JRS and the general ledger.

Refer to Table 40.13 for details.

In addition to the above, there was absence of reconciliation of sales recorded in the Plumber Shop with that in the general ledger 40.16 Does the Ministry have detailed list of Trust Fund Account balances?
If not what actions has the Ministry taken to prepare a detail list?

Yes the Ministry has a list of Trust Fund Balance which is reconcile on a monthly basis and submitted to Ministry of Economy before the 15th of every month.

OAG to provide update on this issue in relation to the Ministry’s response.

FEA Grid and House Wiring Refunds in the Energy Trust Account.

The Energy Trust Account had a balance of $2,232,312 as at 31 July 2018.
The closing balance comprises of refunds for the FEA Grid and House wiring, bond payment for projects and revenue for bills collected from the Solar Home Systems.

However, the Ministry could not provide a detailed breakdown of the balance in the account for audit review.

Hence, it was not possible to determine the funds kept in the account which related to FEA Grid and House wiring, bond payments and revenue from Solar Home System.
The audit issue is related to the detailed listing of people depositing the funds into the Energy Trust Account.

The Ministry does perform General ledger reconciliation on a monthly basis, however the details listings is not maintained.

OAG can confirm that listing is only maintained from 2010.

Departments Response on Current Status Current OAG Reponses The Ministry has tightened up on these internal control by the filling of vacant post to allow proper segregation of duties.
Previously staffs were doing table works which in most times overlap due to limited staff on hand, however it is gradually being tighten up with all these appointments.

Standard operating procedures are being followed by Department under the Ministry to ensure flow of work is covered in all areas and any loophole within the system is automatically clarified and tightened up.

OAG to provide update on these issues (SOPs) and filling of vacant positions.
To some extent, the Ministry has improved the internal controls.

However our 2019 audit indicates that there are still room for improvements largely around, TMA and Trust Accounts.

As for the vacant positions, as at 31 July 2019, 171 position were vacant.

No.

PAC Question We also noted refunds to customers for Grid and House Wiring were slow which could be attributable to lack of appropriate information.
The Ministry indicated that the unavailability of the adequate records were due to frequent movements in staff due to resignations in the Department and lack of reviews by the Senior Officers.

Due to lack of adequate records timely refunds for FEA Grid and House wiring is hindered.

40.22 Delay in filling of Vacant Positions Auditor General has highlighted a number of deficiencies in the Internal Control System.
Provide updates on the current Internal Control System in the Ministry and advice what changes has been made to remedy the deficiencies.

The Ministry had approved staff establishment of 1,076 for the year ended 31 July 2017.

However a total of 353 or 32.8% of the total positions in the Ministry were vacant as at 31 July 2017.

The vacant positions comprised of 202 established and 151 Government Wage Earner positions.
Furthermore, there was an in the number of vacant positions from 263 for the seven months for the ended 31 July 2016 to 353 for the year ended 31 July 2017. increase The delay in filling in the vacant positions could impact on the service delivery of the Ministry and as such the Ministry may not be able to achieve the desired output as per its Annual Corporate Plan.

In addition, public funds committed in the budget estimates are not fully utilized for the purpose it was appropriated by Parliament.
Ministry of Education, Heritage and Arts Underutilization of Capital Expenditure Budget Q1: What is the average turnaround time for the vetting of Ministry’s Memorandum of Agreement by SG’s Office?

OAG to provide update on this issue and what is the progress from the Ministry For the projects verified in the 2019 audit, we noted that the turnaround time was consistent with the explanation provided by the Ministry of Education Heritage and Arts (MEHA) that is was within 2 weeks.
Please refer to the table below for details.

Project Turnaround time day 1 day 2 days 4 days 14 days Q2 What approved building plans were followed in building new structures for schools damaged in the tropical cyclone?

OAG to provide update on this issue The Ministry’s projects are designed by the Ministry of Infrastructure and Transport (MoIT) which follows the Fiji National Building Code and other relevant standards.
MoIT specification for proposed new structures makes reference to the Fiji Building Code and relevant standards.

Q3 How did the Ministry monitor that this was complied with in all projects carried out during the rehabilitation process?

OAG to provide update on this issue Projects are certified by the Acting Director Building and Government Architects (MoIT) before payment is processed for each phase.
The school projects practical completion certificate are also signed off by the Acting Director Building and Government Architects on behalf of the Ministry of Education.

These were verified to the supporting documents to the payment vouchers.
Unbudgeted Expenditure Q4 On the issue of unbudgeted expenditures has this been rectified or how is the Ministry planning to bring in these capital projects into the plans of the Ministry The Ministry’s projects are budgeted in capital expenditure allocations namely capital construction, capital purchases and capital grants and transfers.

Projects are prioritized based on need.

OAG to provide update on this infrastructure report Data collated from the Infrastructure audit was provided to the OAG team.
These included data on; controlling authority, lease type, land tenure, stand by generator, access, fencing, fencing condition, building type, building structure type, building plan, local authority approval, cyclone certificate, foundation type, foundation condition etc.

A final report on the audit is yet to be provided to the OAG team.

Building grant Q5 Has the Ministry implemented the audit recommendation?

OAG to provide update on this issue.


OAG recommendations in the 2016 - 2017 General Report OAG Update The Ministry should: Ensure that the Asset Monitoring Unit and District Education Officers verify and inspect the construction of school buildings which have been completed Asset Monitoring Unit (AMU) is inspecting and monitoring and preparing inspection reports on the construction of school buildings.

AMU that were requested from the Ministry were also provided to the auditors.
inspection reports Required documents are submitted with the building grant applications Tender approvals and contract agreements were sighted for projects audited in 2018/2019.

report and audited Obtain progress financial statements from the recipients of grants to ensure that all grant moneys are properly accounted for Progress reports are now prepared by the Ministry and financial statements from recipients are being submitted.