By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Public Treasury has been urged to get a grip on $20 million worth of “dishonoured cheques”, with the Auditor General calling on these to be provided for as ‘doubtful accounts’.

The official 2011-2012 audit of the Government’s finances, tabled in Parliament late Monday, said the Auditor General “continues to have concerns” with dishonoured cheques submitted to the Public Treasury.

In response to Terrance Bastian’s call for these to be constantly monitored, and “a provision for doubtful accounts established”, the treasurer, Eugenia Cartwright, said: “Some progress has been made.

“We continue to improve our controls to minimise the incidents of dishonoured cheques and also the delay in the processing of dishonoured cheque refunds.”

Elsewhere, the Auditor General reiterated that some civil servants has been allowed salary deductions that exceeded 75 per cent of their monthly salary, breaching the limit set by a June 29, 2009, Treasury guidance note.

“We agree that some employees’ payroll deductions exceeds the threshold of the policy. However, only in extenuating circumstances is this allowed,” Ms Cartwright responded.

“It should be noted, however, that prior to the implementation of the policy there were a number of persons who had already exceeded this threshold, and there has been very little change to this number thereafter.”

And the Auditor General also called for salary advances made to public officials between 2006 and 2011 to either be recovered, or written off.

He added that these were “not fully satisfied” within the six months allowed for repayment, according to the Government’s own systems.

“These employees are no longer employed, and until a policy decision is made on how to deal with the outstanding amounts, the [system] will not display the loans as being fully satisfied,” Ms Cartwright said.

Meanwhile, the Auditor General branded the Post Office Savings Bank, which has $7.312 million in assets, as a major fraud and money laundering.

“We are concerned about the potential for fraud in the Post Office Savings Bank due to the weak internal controls and the antiquated accounting systems in place,” the Auditor General’s 2011-2012 report said.

“The large number of inactive savings bank accounts is also a concern because of the weak internal control.”

The Auditor General added that the Post Office Savings Bank had failed to comply with its legal requirement to file its financial statements by calendar year-end “for a number of years”.

Noting that, as a financial institution, it was obliged to comply with this nation’s anti-money laundering regime, the report added: “We are also concerned about the possibility of fraudulent activities, including money laundering, within the Post Office Savings Bank, especially in the Family Islands.

“The Post Office Savings Bank is required to maintain and develop an anti-money laundering policies and procedures manual.

“Currently, there are no proper guidelines by which the Post Office Savings Bank conducts its business and ensures there are proper controls in place to reduce the risk of money laundering.”

Not surprisingly, the Auditor-General called for such a manual to be devised to “assist in reducing the risk of money laundering”.

The report also called for the Government to create a Departure Tax Collection Centre at Lynden Pindling International Airport (LPIA), on the grounds that airlines and travel agents were taking too long to remit sums collected to Customs.

“This process is plagued with challenges due to the delay of payments to Bahamas Customs,” the Auditor-General said. “Customs collected approximately $44 million in departure tax, and have an outstanding balance of approximately $6.5 million.”

Recommending the Departure Tax Collection centre as a way to address this issue, the Auditor-General added: “The departure tax would be collected on a daily basis and deposited on a daily basis.

“This would eliminate outstanding departure tax and improve the timely collection of revenue.”

The Auditor General also called on the Hotel Licensing Unit pursue the $1.333 million in outstanding guest taxes due at end-June 2012, noting that sums collected were up by $3.117 million to $43.388 million.