Audit shows ASG with $13M budget overrun in FY12
Due to a more than $13 million budget overrun in fiscal year 2012, independent auditors have recommend the American Samoa Government establish a system of “budget accountability” to prevent such problems from occurring in the future.
According to ASG’s financial audit for FY 2012, the largest overrun is close to $5 million under the budget category called “Transfer out”, according to the Seattle-based firm of Moss-Adams LLP, which audited ASG's Single Audit and Financial Statement for the period ending Sept. 30, 2012 — the final quarter of FY2012.
The financial statement audit data shows a $1.40 million in Fono overrun as well as a $1.52 million overrun in the budget category “Misc. Accts - None departmental”. A total of 41 departments, offices, special programs and other budget categories overran their budgets, which includes the Governor’s Office to the tune of $614,137 and a Treasury Department overrun of $498,556.
ASG’s approved budget for FY 2012 was $382.94 million, according to budget documents from that fiscal year.
In the Single Audit Report, auditors said, “numerous ASG departments and functions exceeded their budget appropriation. We noted excess expenditures of $13.7 million over budget.” It also noted that the FY 2011 budget was overrun by $8.9 million.
The cause of the excess spending is that there “is no consistent formal budget accountability process in place across all ASG departments and functions,” auditors said. “Also, because there is no accurate monthly general ledger or interim financial statements available to ASG departments... there is a lack of financial information available to the departments to enable them to accurately track and monitor available funds.”
“Budget overruns impact the Territory’s ability to effectively conduct operations in current and future fiscal years,” they said and recommended, among other things, for ASG to “establish a system for budget accountability”
ASG concurred with the recommendation. “With the upgrade and enhancement to our financial management systems (or IFAS) and revised policies and procedures, it will enable accountability and transparency in our budgetary processes,” said ASG.
Additionally, the “Paperless Initiative does not allow the creator to submit a transaction if appropriate funding is not available”.
“We have implemented our paperless module and it is currently in motion with expectations to have it fully operational by the end of fiscal year 2013,” said ASG. “We are confident that we will improve our reporting deficiency by the end of fiscal year 2014.”
Noted in the Single Audit Report and the Financial Statement Audit is that the current administration of Gov. Lolo Matalasi Moliga took office on Jan. 3, 2013.
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