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NAO Says MKAC Financial Statement Do Not Fairly Present Its Financial Position

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Bakary Trawally, the Director of Audit, Municipalities and Area Councils, NAO

By Ramatoulie Jawo

Bakary Trawally, the Director of Audit, Municipalities and Area Councils of the National Audit Office (NAO) has said that the Financial Statement of Mansakonko Area Council does not fairly present its financial position.

“We have audited the Financial statements of Mansakonko Area Council, which comprise the balance sheet as of December 31st, 2019, the revenue and expenditure statement, and notes to the Financial Statements.

“Our opinion, because of the significance of the matter discussed in the Basis for Adverse Opinion section of our report, the accompanying financial statements do not present fairly financial position as of December 31, 2019, and (of) its performance for the year that ended 2019. By the Local Government Act, 2002 Financial & Accounting Manual for Local Government Authorities 2009, and Generally Accepted Accounting Principles,” Mr. Trawally said.

Mr. Trawally said the council did not state the accounting policies it adopted and followed for the treatment and reporting of its transactions. He stated that It was not apparent from the review of the statement which policies were followed, adding that the Financial and accounting manual for local government authorities requires the preparation of a balance sheet.

“This may not be practicable given the basis of accounting followed by the council (cash basis); IPSAS however strongly recommends disclosure of information on assets and liabilities of the reporting company within the notes of the financial statement. For this reason, the true and complete picture of the council’s standing is not available to stakeholders for decision-making,” Mr. Trawally said.

Mr. Trawally made these remarks before the National Assembly Standing Committee on Finance and Public Account Committee (FPAC) where he further disclosed that there is a disagreement between the primary books and journal balance of the Mansakonko Area Council.

“The cash books balances for the relevant account had huge differences with the corresponding codes in the ledgers. There was a cumulative deficit variance of GMD 618,130.00 and a cumulative surplus variance of GMD 125,219.00 respectively. These differences remained unexplained and uncorrected up to the time of the finalization of this report.

“There were huge differences between most account balances in the ledgers with corresponding balances in the trial balance. A cumulative variance of GMD 9,127, 636.00 and GMD 11, 786, 041, 09 for revenue and expenditure respectively existed. This too was not explained and/or corrected during the finalizing of this report. Most of the balance in both the ledgers and trial balance had zero balances and the management did not provide any explanation,” he said.

The 2019 Financial Statement of the Council will be table before FPAC for scrutiny and consideration on Tuesday.

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