July 5, 2023 –WILLEMSTAD – The General Audit Chamber of Curaçao notes that the financial obligations, expenditures, and revenues in the government’s 2020 financial statements were not in accordance with the laws and regulations.
In total, nearly 835 million guilders of taxpayers’ money did not comply with the established national budget regarding their receipt or expenditure. The assessment is based on two significant findings.
Firstly, the obligations, expenditures, and revenues in 2020 were not in accordance with the applicable laws and regulations, resulting in a lack of financial regularity. Secondly, the financial statements do not provide an accurate representation of the country’s financial position as of December 31, 2020, and the results for that year, thus preventing the Parliament and other users of the financial statements from obtaining a correct understanding of the country’s financial situation.
The lack of orderliness and verifiability in financial management forms the basis for the findings and conclusions. Financial management does not meet the minimum requirements of orderliness and verifiability as stipulated in the Financial Management Act.
Separation of duties, internal revenue control, internal control functions, and required internal audits are not adequately implemented within the ministries.
Furthermore, other relevant provisions of the Financial Management Act are not fully complied with, such as the issuance of necessary national decrees and ministerial regulations. These shortcomings result in insufficient guarantees for the lawful collection of revenues from taxpayers, payment of expenditures, and a faithful representation of the figures in the financial statements.
Errors in Legality
The impact of these shortcomings on the financial statements is illustrated by the identified errors in legality, fidelity, and uncertainties.
Although the country had the intention in 2018 to establish and maintain proper financial management, it has been found that the improvement actions are lagging the roadmap’s schedule.
The minister has indicated that the target date for obtaining an unqualified audit opinion has been shifted, and it can now be expected at the earliest in the 2026 financial statements.
This means that serious deficiencies and weaknesses in the country’s financial management have been identified once again. Despite ongoing plans to address the issues, timely and adequate progress has not been made. As a result, the country does not comply with the principles of good governance regarding transparency and public accountability.
The Audit Chamber is aware of the delay in implementing the improvement plans because of COVID-19. In future audits of the financial statements, the Audit Chamber will assess whether the improvement actions are being realized according to the adjusted schedule of the roadmap.
However, it is not known whether the new target date for obtaining an unqualified opinion has been officially communicated to the Board of Financial Supervision (Cft).