Territory still not consistently clean with financial audits


As of early this year, American Samoa, is not listed as one of the nine insular area governments that have consistently “received unqualified — clean — opinions from... respective independent auditors” who have reviewed their financial statements, according to a report by the U.S. Interior Department’s Office of Insular Affairs.

It was presented to this year’s meeting of the Interagency Group in Insular Affairs (IGIA), held in February in Washington D.C.

The reports notes nine of the 11 insular governments that got clean opinions of their audits are: territories of Guam and the Commonwealth of the Northern Mariana Islands, the Republic of Palau, Marshall Islands, and the governments of the Federated States of Micronesia's, i.e. the National Government and the respective state governments of Chuuk, Kosrae, Pohnpei and Yap.

The report did note that all of the insular areas have shown marked improvement in the reliability of their financial data and in the administration of federal grant programs.

Also noted, with each passing year the 11 insular governments have reduced the number of material audit findings and the amount of questioned costs related to federal grant programs, the report points out.

“Also, due to the increased accountability and accuracy of the financial data, Federal reviewers have been more successful in assisting the insular program managers to improve processes and, in some cases, the reviewers have been able to more successfully identify and investigate fraud, waste and abuse of federal funds,” it says.

According to the report, OIA continues to work with each insular government to help develop and implement processes designed to result in reliable financial data and improvements in the administration of Federal grant programs, many that provide funding for critical public services in the insular areas.

A prime tool for identifying weaknesses in governmental processes are the Single Audit Reports completed by independent certified public accounting firms contracted by insular governments in compliance with federal laws.

OIA reviews the Single Audit Reports and the insular governments’ annual financial statements to help determine the financial position of the insular government and the actions taken to correct any identified noncompliance with Federal grant programs, i.e. the corrective action plan, the report says.

According to the report, OIA selected the Single Audits of 2004 as a base year for comparison in order to help monitor and evaluate the progress of each of the island governments to resolve audit findings and audit opinion qualifications.

“By tracking the progress, OIA is able to identify specific areas in which assistance such as technical advice, training, communication with Federal partners and outside expertise is needed,” it says.

OIA also outlined in the report how much in Capital Improvement Project (CIP) money and other OIA grant funding was awarded to the insular area governments in fiscal year 2011 (Oct. 1, 2010 to Sept. 30, 2011).

For American Samoa it was more than $11 million  —with CIP funding the largest amount at $10.5 million to address a variety of infrastructure needs, including $2.6 million to renovate and expand the Dialysis Unit at the LBJ Medical Center; $1.6 million to continue building classroom buildings at elementary schools; and $380,000 to complete the Petesa Happy Valley Village Road project.

Other grants awarded to the territory:

•            American Samoa Power Authority with $596,000 in Empowering Insular Community funding for energy efficiency and conservation projects including a program to provide florescent bulbs to Manu’a residents and a recycling rebate project.

•            $600,000 to fund the American Samoa Air Transport Market Study through the Technical Assistance Program (TAP). The study will be to quantify and document the market demand for expanded air cargo and passenger transportation services at the territory’s Pago Pago International Airport.

•            $400,000 to LBJ hospital for Practitioner training. The funds will be used to train LBJ practitioners, by four board-certified physicians, in order to improve healthcare services.


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