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Sundry deposits

Filipe Naigulevu
Wednesday, November 01, 2017

SUNDRY deposits amounting to $57,817 were accumulated by the Sigatoka Town Council for several years without any supporting documentation to substantiate its existence.

This issue was scrutinised yesterday by the Parliamentary Standing Committee on Public Accounts as the council made its submission on the 2014 Auditor-General's Report on municipal councils.

According to the report, the council was unable to substantiate deposits received amounting to $57,817 because of lack of appropriate supporting documents.

This was said to have accumulated for more than 20 years.

The report also stated that the Auditor-General was not able to satisfy himself if the sundry deposits balance was fairly stated in the statement of financial position.

Responding to the committee's queries, council manager finance Mohini Nair explained that their sundry deposits were made up of deposits paid by tenants and contractors to the council.

She said there was no breakdown available for the miscellaneous deposits when she started preparing the accounts from 2012.

"From that time I have noticed that.

"Whenever we have meetings with auditors, they informed us that we have to look for the details," Ms Nair said.

"We have checked all our records and we were unable to get the breakdown like the receipt numbers and so, but we know how the $57,000 comes to."

The report also found that the council may not be in a position to refund accurately the deposits as and when the payment falls due. Also, in absence of supporting documents, the sundry deposits balance may not be fairly reflected in the balance sheet. The council has also indicated that it would not be able to provide the supporting documentation for sundry deposit as this balance was carried forward prior to 2000 of which they do not have documentation for that period.

Meanwhile, the committee had also advised the council to write a letter to the Ministry of Local Government for the write-off of this amount.

It is also understood that the ministry had informed the committee that they have received the letter from the council and will await discussions with the Office of the Auditor General (OAG).

The Auditor-General's Report has also recommended that the council provide proper ledgers and documentation for sundry deposits.

This, the report stated, should be maintained and to support amounts reported in the financial statement.

Meanwhile, the committee also queried the council's financial statements which were not in accordance with the International Financial Reporting Standards for Small and Medium Entities (IFRS for SMEs) as required.

The report stated that the audit was unable to determine the impact on the financial statements of the council if any, adjustment which may be necessary if the financial statements were prepared under IFRS for SMEs.

Council chief executive officer Tulsi Ram swiftly clarified that they had been in accordance with IFRS for the past two years.

"We have resolved this and have taken action and have no problems," Mr Ram said.








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