Audit exposes financial reporting failures across municipal councils

Not one of the 19 financial statements audited across eight municipal councils received a clean audit opinion, with some council accounts remaining up to six years behind.

The findings are contained in the Auditor-General’s report tabled in Parliament last week, highlighting continuing weaknesses in financial reporting and accountability across municipalities.

The audits covered Nausori, Tavua, Rakiraki, Levuka, Savusavu, Suva City, Labasa and Lami councils, with all 19 financial statements receiving modified opinions.

Auditor-General Finau Seru Nagera said 10 of the 19 financial statements received disclaimers of opinion — the most serious type of modified audit opinion — across four councils.

A disclaimer means the Auditor-General was unable to obtain sufficient evidence to verify the financial information presented.

“The financial statements audit of all municipal councils are in backlog by two to six years, except for Rakiraki Town Council,” the report stated.

The report also revealed that 44 draft financial statements from 12 councils had yet to be submitted for audit.

Delays by councils in providing management comments and returning signed audited financial statements were also contributing to the backlog.

Government blames inherited ‘mess’

Deputy Prime Minister Manoa Kamikamica, a former Public Accounts Committee chairperson, blamed the situation on decisions made under the previous government, including the cancellation of municipal council elections.

“Some of these areas of government, which we inherited from the last government were, to be honest, in a mess,” Mr Kamikamica said.

“One of the main reasons that happened was they cancelled the elections of the council, and then started electing their own people to manage the town councils.

“Some competent, some incompetent, and so the results are very easy to see.”

Mr Kamikamica said Rakiraki was “one of the shining examples” of improvement and pointed to new IT platforms and stronger leadership as part of efforts to address the problems.

“It’s all about accountability,” Mr Kamikamica said.

Rakiraki is the only one of the eight councils whose accounts are up to date, with its 2024 and 2025 financial statements submitted and audited on time.

However, it still received a qualified opinion.

Auditors were unable to verify market and car park fees and public convenience income, while a $40,549 discrepancy was identified in its Value Added Tax records.

Questions sent to Minister for Local Government Maciu Nalumisa remained unanswered when this edition went to press last night.