Island Times, May 18. 2012 edition
The final audit report on Protected Areas Network Fund (green fees) shows expenditures that the public auditor found to be unauthorized.
In the report, copy of which was obtained yesterday by Island Times, the auditor found that although a separate account for green fees was established within the National Treasury, as required by law, the Division of Customs did not maintain a log book for the production and distribution of cash receipts books for green fees.
The division did not also file the National Treasury-issued cash receipts together with the green fees cash receipts to evidence deposit of collections into the Treasury.
The auditor recommended that the division be more attentive to its internal control processes to ensure that cash receipts are maintained and filed securely to support deposit of green fees collections.
The audit also revealed transfer of amount of expenditures from the Ministry of Natural Resources, Environment and Tourism to the PAN Fund, which the auditor found to be unauthorized.
The report showed that on November 5, 2010, the PAN coordinator and NRET Minister entered into agreement to transfer $29,814 of expenditures of the ministry to the PAN Fund. Expenditures were for the electricity and communication for the Bureau of Marine Resources. Supporting documents showed inter organization transfer was approved on November 1, even before the agreement to transfer the expenditures.
It reportedly appeared that BMR was in delicate position to overspend its budget so the minister had to take measures to avoid budget shortfall
The auditor said that PAN Fund can be expended only for the purpose of the PAN and that reprogramming this is prohibited.
The auditor recommended that the Office of the Attorney General investigate the transfer of expenditures and take appropriate action for any improper and unauthorized expenditure of green fees.
The audit further revealed PAN Office expenditures charged to the PAN Fund for Fiscal Years 2010 ($63,443.35) and 2011 ($180,980.10).
“The legal opinion obtained by the OPA concludes that only the PANF is authorized by law to administer and disburse PAN Green Fees as the Financial Trustee Corporation for the PAN. Based on this interpretation, we were unable to determine the legal authority under which the PAN Office (MNRET) and the Bureau of National Treasury charged PAN office expenditures to the PAN Fund,” the report said.
The report said that the PAN office and Bureau of National Treasury may have violated the laws in the expenditures of public funds.
Furthermore, the auditor recommended that the leadership of the OEK confer with President of the Republic as to the appointment of the members to the PANF Board of Directors.
The auditor found that the appointment by the president contradicts with the requirements by law and PANF’s Articles of Incorporation.
The report said that of the nine members, that include the Minister of Finance and Minister of NRET, five shall be selected by the incorporators and two shall be selected by the donor community.
The PANF responded to the audit stating that the board has reviewed and discussed the report and that it has no objections to the report and all of its recommendations. The board committed to take the information into consideration as they continue to finalize the PANF Office and hire a general manager.
On the other hand, the Ministry of Finance did not provide written response to the draft report despite being provided a copy and 30 days grace period to submit a response.
