By KHRISNA VIRGIL

Tribune Staff Reporter

kvirgil@tribunemedia.net

AUDITOR General Terrance Bastian recommended in his audit report of the Road Traffic Department in Abaco that the Marsh Harbour office be shut down until proper internal controls were established.

At the time of the audit, there were 17,502 validation, inspection and decal stickers missing from the department’s physical inventory valued at approximately $656,710. Overall, the audit found the total weaknesses in the department resulted in the loss of a proper audit trail for stickers and contributed to the department’s inability to account for stickers and other revenue generating documents valued at $662,705.

This was because “the officer with responsibility for oversight of daily activities as the accounting officer did not ensure proper operational and record keeping procedures were properly established or consistently complied with,” the report said.

The audit was tabled in the House of Assembly yesterday. It covers the period January 1, 2012 to March 31, 2015.

“As a result of our audit examination of (the) Road Traffic Department, Marsh Harbour, we concluded that the revenue collections boundary was not properly or accurately accounted for,” the report said.

“The audit findings show significant deficiencies with the department’s management of general and other receipt books, certificate of motor vehicle inspection books, motor vehicle counterfoils, validation, inspection and decal stickers.

“The totality of weaknesses found resulted in the loss of proper audit stickers and contributed to the department’s inability to account for stickers and other revenue generating documents valued at approximately $662,705.”

It continued: “We would advise that due to our findings reported herein that you consider turning the matter over to the police for further investigations.”

On Monday, Transport and Aviation Minister Glenys Hanna Martin revealed that police were investigating the matter. The investigation involved three current workers and an employee who retired from the department earlier in the year, Road Traffic Controller Ross Smith later confirmed.

The audit also revealed that in the Abaco office, the management of the sticker inventory was inadequate which resulted in substantial deficiencies.

Auditors also recommended that the department’s ongoing payment plan system cease.

During the auditor general’s probe, the investigators found payment plans for 21 motor vehicles billed to one customer amounting to $15,195 (customer one) and two licenses billed to another customer (customer two) for $390, for a total of $15,585.

“While facilitating those payment plans, there was a significant delay in accounting for monies from the motor vehicle validations, inspection and decal stickers used,” the audit said.

“The receipts issued to customer one and customer two by the Road Traffic Department supervisor were not authorised Bahamas government receipts as per the exemplar of an official receipt included in the Bahamas government accounting and procedural manual.

“Normal accounting processes were not adhered to in the above instances. Consequently $8,800 was not accounted for in a timely manner. The result was that the deposit monies did not occur until some 18 to 499 business days from the issuance date of those licenses.” “Furthermore, there was no supporting documentation showing whether $6,705 billed to customer one was brought to account,” the report said.

The audit also found that 109 original and duplicate certificate of inspections valued at $3,815 were missing from receipt books.

Auditors found that these documents were not properly filed.

“During our physical inspection conducted on February 6, 2015, we observed a box of receipts which were not filed in any particular order.

“Proper records to enable verification of certificate of inspections issued to the department were not maintained.”

Recommendations

As a result of the findings, Mr Bastian recommended that certain internal controls were established.

He said: “The department must ensure that all stickers and revenue earning documents issued from Road Traffic Nassau are properly recorded in the department’s register.

“Steps must be taken to cause the establishment of a proper register which captured the counterfoil issue note number and dated, each sticker in the sequence, the dates of issuance to Road Traffic officers, the name, signature of issuance/receiving officers or dates of usage.

“The supervisor’s sole custody of the department’s inventory, recording and issuing functions must be addressed and duties must be segregated.”

He added that it was imperative that swift action was taken to establish and strengthen the internal controls, as any undue delay would prolong the risk that monies collected on behalf of the government may not be accounted for accurately.

“Additionally, the department must also produce $667,300 from missing stickers and other revenue documents,” the audit said.

In a statement on Tuesday, Mr Smith said following the audit the department implemented the recommended controls at the Marsh Harbour, Abaco office.

He said he was also in the process of implementing additional system-wide controls to allow for greater accountability and to prohibit further acts of misappropriation.

He said the critical process of automating of the department’s operations - the Transport Management System - is now underway to be completed within the next 12 months. This automation process will bring about a greater level of efficiency and accountability relative to the collection of revenue.