I. Budget reliability
Scores by Dimension
Overall Indicator Score
1. Aggregate expenditure outturn
B
Notes:
1.1 Aggregate expenditure outturn
B
Notes:
Table 1-1 indicates that actual expenditures as a percentage of the budget estimates fell between 90% and 109% for all the fiscal years; FY17/18, FY18/19 and FY19/20. In line with the scoring criteria, this indicator has satisfied the requirement for a B.
2. Expenditure composition outturn
B+
Notes:
2.1 Expenditure composition outturn by function
B
Notes:
Variance in expenditure composition by budget function was less than 10% in 2018/19 and 2019/20 which implies a score of B.
2.2 Expenditure composition outturn by economic type
A
Notes:
Variance in expenditure composition by economic classification was less than 5% in the last three years therefore satisfying the requirements for an A.
2.3 Expenditure from contingency reserves
A
Notes:
Expenditure from contingency reserves is restricted to costs that were not reasonably foreseeable when the budget was approved. Contingency expenditures were recorded as zero for all the past three years. This implies a score of A.
Notes:
3.1 Aggregate revenue outturn
C
Notes:
Actual revenues exceeded budget revenues in each of the past three years:
3.2 Revenue composition outturn
B
Notes:
Taxation revenue is approximately ¾ of all revenues, substantially overshadowing variance in other categories of revenues. Variance in revenue composition was less than 10% in 2017.18 and 2019/20 meeting the requirement for a B score
II. Transparency of public finances
Scores by Dimension
Overall Indicator Score
4. Budget classification
B
Notes:
4.1 Budget classification
B
Notes:
The budget formulation, execution, and reporting of results are based on administrative, economic, and functional classification using GFS/COFOG standards. These are clearly presented in Book 1 of the budget documents for the years 2017/18; 2018/19; and 2019/20.
Notes:
5.1 Budget documentation
A
Notes:
Budget documentation fills all twelve elements, including all four basic elements. In 2015, the budget filled 8 of 9 benchmarks. In 2021 the budget fulfills all standards.
6. Central government operations outside financial reports
A
Notes:
6.1 Expenditure outside financial reports
A
Notes:
Expenditures outside of government financial reports is less than 1% of total BCG expenditures in 2019-20. This expenditure outside financial reports refers to the charges made by the local public school committee from donations received. All central budgetary government entities reported their actual expenditure versus the approved budget, and these have been included in the consolidated financial reports.
6.2 Revenue outside financial reports
A
Notes:
Revenues outside of government financial reports is less than 1% of total BCG revenues in 2019-20. This expenditure outside financial reports refers to the donations received by the local public school committee.
6.3 Financial reports of extrabudgetary units
A
Notes:
Detailed financial reports of all extrabudgetary units are submitted to government annually within three months of the end of the fiscal year. These extrabudgetary units of the central government refer to the Trust Funds and donations to the local public school committee as authorized by the government. Only the donations received by the public school committee constituting less than 1% of the total central government extrabudgetary funds were not reported.
7. Transfers to subnational governments
A
Notes:
7.1 System for allocating transfers
A
Notes:
All transfers to the subnational level to the Outer Islands (PA Enua)[1], that are the only subnational level from central government in CIS, are determined by the Island Government Act 2012/2013 which establishes a transparent, rule-based system (Pa Enua Funding model)[2].
7.2 Timeliness of information on transfers
A
Notes:
Fund allocation and transfers to Outer Islands use the regular budget calendar of CIS and the budget is approved only by the central government legislative. Budget allocation information is informed through a ceiling budget memo that allows more than six weeks to complete Outer Islands budget on time.
8. Performance information for service delivery
C+
Notes:
8.1 Performance plans for service delivery
B
Notes:
Ministry and agency Business Plans presented in Book 2 of the Budget specify output targets for all agencies, not just those that deliver services. Some delivery plans specify quantitative goals, both for the budget year and for the three following years.
8.2 Performance achieved for service delivery
C
Notes:
Performance delivery is not reported systematically. Agency presentations in Book 2 do summarize “Significant Achievements and Milestones”. These presentations do not appear to be directly related to output targets. Information is published annually on the activities performed for the majority of ministries.
8.3 Resources received by service delivery units
A
Notes:
All budgetary resources are allocated within Ministries and agencies by output. Book 1, Chapter 8, provides descriptions of the intended outputs for all spending. Both the Education and Health Ministries outputs are organized by service delivery functions. Funding at the Ministry level is reported by these outputs. Funding from donors is incorporated in the budget. There is virtually no non-public funding in the Cook Islands Budget.
8.4 Performance evaluation for service delivery
D
Notes:
There is no performance evaluation for service delivery on an ongoing basis. In 2018, MFEM undertook a Public Expenditure Review done by a contractor. That review did evaluate the effectiveness of spending.
9. Public access to fiscal information
B
Notes:
9.1 Public access to fiscal information
B
Notes:
The government makes available to the public 7 elements, including 4 basic elements and 3 additional elements, in accordance with the specified timeframes.
III. Management of assets and liabilities
Scores by Dimension
Overall Indicator Score
10. Fiscal risk reporting
C
Notes:
10.1 Monitoring of public corporations
D
Notes:
The Cook Islands created the CIIC to oversee the management of its SOEs. The CIIC monitors public corporations and reports on their finances. It produced a consolidated financial statement for the SOEs: 30 of June 2019. The CIIC statement does not provide data on individual institutions and did not meet the goal of reporting within nine months of the end of the fiscal year.
10.2 Monitoring of subnational governments
C
Notes:
The Budget provides comprehensive information on financial assistance to the Pa Enua (outer islands) including actual and budgeted spending, funding formulas, other agency support, ODA support and an economic overview of each island. The finances of island governments are incorporated in the Quarterly Financial reports but are not audited or shown separately in the reports. The audit office does audit their annual financial reports.
10.3 Contingent liabilities and other fiscal risks
A
Notes:
Contingent liabilities are described and quantified in the Budget. Table 4.15 shows contingent liabilities as of June 30. Regulations governing the financial reporting on contingent liabilities are set out in section B 9 of the FPP.
11. Public investment management
C
Notes:
11.1 Economic analysis of investment proposals
C
Notes:
Economic analyses are conducted to assess some major investment projects. Copy of the economic analyses of only 3 of the 10 major investment projects included in the 2019-20 budget were provided to the PEFA assessment team. These 3 projects comprise 39% of the total four-year cost of the top 10 major investment projects.
11.2 Investment project selection
C
Notes:
Prior to their inclusion in the budget, major investment projects are prioritized by a central entity, the Infrastructure Committee. However, there are no standardized selection criteria.
11.3 Investment project costing
C
Notes:
Projections of the total capital cost of major investment projects, together with the capital costs for the forthcoming budget year, are included in the budget documents. However, recurrent expenditures of public investments are generally not included in the budget projections.
11.4 Investment project monitoring
C
Notes:
The total cost and physical progress of major investment projects are monitored by the Project Coordination Committee with inputs from the government implementation unit Project Managers. Summary of project implementation by ministry is published annually in the Budget Book- Table 9. However, a B Rating could not be justified since there are no standard rules and procedures on project implementation that are currently in place. Actual cumulative cost is also not published.
12. Public asset management
D+
Notes:
12.1 Financial asset monitoring
D
Notes:
Financial assets are reported in the annual financial statements of government, but the Auditor has cited questions about the record keeping and asset inventories used to establish values for the reports.
12.2 Nonfinancial asset monitoring
D
Notes:
Asset inventories are not fully established. Asset management standards are still being implemented.
12.3 Transparency of asset disposal
B
Notes:
The FPP issued in March 2019 provides clear guidance on asset disposal – see B 10. Asset disposals are reported in annual financial statements for the government and in CIIC statements for SOEs
Notes:
13.1 Recording and reporting of debt and guarantees
A
Notes:
The Budget, quarterly reports and financial statements provide comprehensive information on debt and guarantees, updated in the Treasury accounts on a monthly basis.
13.2 Approval of debt and guarantees
A
Notes:
All debt and guarantees must be reviewed by the Central Agencies Committee, endorsed by the Cabinet and approved by the Minister of Finance and submitted to Parliament for Appropriation.
13.3 Debt management strategy
A
Notes:
Debt management strategy is presented in concept in the Medium-term fiscal strategy and described in depth in Chapter 11 of Book 1 on Crown Debt and Net Worth.
IV. Policy-based fiscal strategy and budgeting
Scores by Dimension
Overall Indicator Score
14. Macroeconomic and fiscal forecasting
B+
Notes:
14.1 Macroeconomic forecasts
B
Notes:
GDP and inflation forecasts are well grounded, taking into account the potential growth sectors in particular tourism and investments. The global environment is also considered in terms of fuel prices and tourism impact. The use of time series ARIMA modelling approach provides a sound framework to forecast GDP. The assumptions are clearly articulated in the budget documents for the three years. The score is short of an A primarily due to the fact that the review of the budget is done by the MFEM itself; not an independent entity.
Notes:
The fiscal forecasts are well laid out with assumptions clearly stated. The implementation of the Medium-term Fiscal Strategy (MTFS) beginning in 2019/20 re-confirms Government’s commitment to sound fiscal and economic management. Adherence to the fiscal rules are clearly emphasized in the MTFS. The fiscal forecasts meet all the requirements for an A, unfortunately the absence of an explanation of the deviations from the forecasts made in the previous year’s budget means this dimension is rated B.
14.3 Macrofiscal sensitivity analysis
A
Notes:
Beginning in the 2018/19 budget, sensitivity analysis was provided as part of the fiscal strategy. This considered different scenarios where tourist arrival changes up and down as well as increased imports. Fiscal scenarios were also modelled to assess the impact of changes in forecast expenditure and revenue on the key fiscal responsibility ratios. This dimension meets all the requirements for an A.
Notes:
15.1 Fiscal impact of policy proposals
A
Notes:
The 2017/18, 2018/19 and 2019/20 budgets clearly present the fiscal strategy which covers the budget year and the three outer years as part of the budget documentation submitted to parliament. With the adoption of the government’s medium term fiscal framework in 2018, the fiscal strategies for 2018/19 and 2019/20 budgets provided a lot more detailed information than in 2017/18.
15.2 Fiscal strategy adoption
A
Notes:
The three fiscal years 2017/18, 2018/19 and 2019/20 clearly present the fiscal strategy that includes fiscal rules, fiscal responsibility ratios and assumptions that underpin the strategy. These are provided for the budget year and two outer years and are submitted to the Legislature as part of the Budget estimates. This satisfies the requirements for an A rating.
15.3 Reporting on fiscal outcomes
B
Notes:
Schedule 1 of the Financial Results for the Year ending June 2020, provides a comparison between the outturn and the budget figures for FY19/20. A brief explanation of the reasons behind the deviations is provided without proposed corrective actions. The Financial Results for the year ending June 2020 is submitted to the legislature. This provides the basis for a B rating.
16. Medium-term perspective in expenditure budgeting
A
Notes:
16.1 Medium-term expenditure estimates
A
Notes:
The 20-21 Budget Book presented the medium-term estimates for the budget year and the three following fiscal years allocated by administrative, economic, and program or functional classifications.
16.2 Medium-term expenditure ceilings
A
Notes:
Aggregate and ministry-level expenditure ceilings for the budget year and the two following fiscal years are approved by government before the first budget circular is issued. The initial 2020-2024 medium-term expenditure ceilings were approved by the Cabinet on January 28, 2020, finalized and endorsed to the Parliament on May 19, 2020. These final ceilings have been communicated to the ministries in a letter dated May 23, 2020. The ceilings are at the aggregate and ministry levels, for each year from 2020-21 to 2023-24.
16.3 Alignment of strategic plans and medium-term budgets
A
Notes:
Medium-term strategic plans are prepared and costed for all ministries. Most expenditure policy proposals in the approved medium-term budget estimates align with the strategic plans. The ministry/agency strategic business planning process is well linked with the medium budgeting process. Changes in the business plan are made in accordance with the approved medium-term budget ceilings. The 2020-2021 Budget Book Volume 2 contains the individual ministry business plans indicating their key outputs and deliverables with cost estimates for each of next 5 years. Each key output is also linked with the National and Agency Strategic Plan Goals.
16.4 Consistency of budgets with previous year’s estimates
A
Notes:
The budget documents provide an explanation of all changes to expenditure estimates between the last medium-term budget and the current medium-term budget at the aggregate and ministry level.
17. Budget preparation process
B
Notes:
Notes:
There is a Budget Process workplan that clearly stipulates the timelines for the preparation of the FY2020/21 budget. From the documents sighted, ministries and agencies are given four weeks to complete their budget submissions. All ministries and agencies do comply with submitting their budget proposals by the due date. This means this dimension is rated B
17.2 Guidance on budget preparation
A
Notes:
According to the budget workplan, agencies’ expenditure ceilings are approved by Cabinet before they are sent out to agencies. The 2020-2024 medium-term expenditure ceilings were approved by Cabinet on January 28, 2020 and circulated to ministries and agencies on 30 January 2020. In that circular, ministry ceilings, the constraints facing the budget, and budget timelines were clearly presented. This suggests this dimension satisfies the requirements for an A.
17.3 Budget submission to the legislature
D
Notes:
This dimension assesses the timeliness of submission of the annual budget proposal to the legislature. For the last two fiscal years 2019/20 and 2020/21, the budget was submitted to the legislature less than a month before the new financial year takes effect. This means this dimension is rated D.
18. Legislative scrutiny of budgets
D+
Notes:
18.1 Scope of budget scrutiny
C
Notes:
The legislature’s review covered details of expenditure and revenue. The medium term Fiscal Policy forecasts and priorities are prepared and submitted to the Parliament but these have not been discussed in Parliament sessions.
18.2 Legislative procedures for budget scrutiny
D
Notes:
The legislature’s procedures (Standing Orders) to review budget proposals are approved by the legislature in advance of budget hearings and are adhered to, except that the review of the economic and fiscal policy on first reading was not done.
18.3 Timing of budget approval
C
Notes:
The legislature has approved the annual budget within one month of the start of the year in two or more of the last three fiscal years, with 2018-19 budget approval delayed by more than one month, due to the conduct of the national election.
18.4 Rules for budget adjustment by the executive
A
Notes:
Clear rules exist for in-year budget adjustments by the executive. The rules set stricter limits on the extent and nature of amendments and are adhered to in all instances. The performance improvement from the 2014 PEFA assessment was mainly due to the greater Parliament scrutiny on the budget expansions or supplemental appropriations.
V. Predictability and control in budget execution
Scores by Dimension
Overall Indicator Score
19. Revenue administration
C+
Notes:
19.1 Rights and obligations for revenue measures
A
Notes:
Customs and tax revenues combined accounted for most revenues (82% of total receipts excluding grants). Fisheries related revenues accounted for 7.5% of revenues, including fishing licenses, fishing fines and US fisheries treaties. Fisheries licenses are governed under the vessel day scheme rules of the Pacific Island Forum Fisheries Agency.
19.2 Revenue risk management
A
Notes:
RMD manages inland revenue and customs services operations which account for most (83%) of all government revenues. Risk management operations target all categories of revenue—specifically, personal and company income tax, VAT and customs account for all (93%) of total taxation income. The RMD Audit Operational Plan specifically designates staff to audits on the basis of category of taxpayer
19.3 Revenue audit and investigation
D
Notes:
Tax audits are managed using the case management tool. 274 tax audits were planned in 2019/20: 68 for large taxpayers; 128 for medium taxpayers; and 78 for small taxpayers. Planned audits covered 27% of all large taxpayers, which account for 25% of all audits undertaken and 46% of audit resource hours. operational. The plan identifies short, medium and long-term investigations (those more complex investigations exceeding 50 hours). Long-term investigations accounted for 43% of total resource hours.
19.4 Revenue arrears monitoring
D
Notes:
Total tax revenue arrears amounted to $29.3 million (19.7% of annual tax revenue), however, 92% of the arrears were older than 1 year.
20. Accounting for revenue
B+
Notes:
20.1 Information on revenue collections
B
Notes:
The MFEM receives revenue collection reports from RMD, the Ministry of Marine Resources and other MCAs collecting non-tax revenues. RMD provides a monthly consolidated report of tax revenues, which account for most (83%) of all revenues (excluding grants). Other non-tax revenues are not consolidated on a monthly basis.
20.2 Transfer of revenue collections
A
Notes:
RMD tax revenue collections are deposited into the central treasury bank account tomorrow on a next day basis. RMD tax revenues account for 83%, i.e. most, of all revenues excluding grants. Fisheries revenues and other MCA non-tax revenues are collected and deposited next day. Revenues from MCAs, including the Ministry of Marine Resources are also deposited to the Treasury bank account daily.
20.3 Revenue accounts reconciliation
A
Notes:
Assessments, collections, deposits (directly to the treasury bank account) and arrears are managed in real-time through the RMS7. De-facto, this includes transfers, as all deposits are made directly to the Treasury account on a next day basis. The system automates the process of reconciliation at each stage, from assessments, to collections, deposits (transfers), and resulting outstanding payables which are aged for purposes of managing arrears. Data on tax arrears with ageing analysis is reported on. Bank reconciliation is undertaken monthly, thereby validating the deposits and reconciling them with collections.
21. Predictability of in-year resource allocation
B
Notes:
21.1 Consolidation of cash balances
D
Notes:
Treasury is planning to consolidate cash balances through the establishment of the treasury single account (TSA). However, this reform is dependent upon the completion of the FMIS rollout. Currently, the FMIS has been rolled out to approximately 20% of MCAs but these exclude the largest entities.
21.2 Cash forecasting and monitoring
C
Notes:
Treasury is planning to consolidate cash balances through the establishment of the treasury single account (TSA). However, this reform is dependent upon the completion of the FMIS rollout. Currently, the FMIS has been rolled out to approximately 20% of MCAs but these exclude the largest entities.
21.3 Information on commitment ceilings
A
Notes:
MCAs receive their annual budget appropriations in full at the start of the financial year. They are therefore able to implement the budget with a significant degree of reliability. Expenditures are controlled against the full budget release.
21.4 Significance of in-year budget adjustments
A
Notes:
Articles 19 and 20 of the PFM Act sets limitations on appropriations and the stipulates the requirements for making transfers between outputs within recurrent appropriations; CIG funded projects in the capital plan; programs within POBOC funding; and transfers of financing amounts. Article 25 of the Act establishes the provisions relating to supplementary appropriations.
22. Expenditure arrears
D+
Notes:
22.1 Stock of expenditure arrears
A
Notes:
CIG operates the accrual basis of accounting and recognizes payables in its quarterly financial reports and annual financial statements. The Financial Policies and Procedures Manual (FPPM) Part D Section 21 addresses expenditure arrears, setting out the definition, mandatory requirements, and processes for preventing and reporting of arrears. Expenditure arrears are defined as those payments that have not been settled within 30 days from the date of the invoice. The overriding principle is to settle all liabilities in a timely manner. The payments and payables processes are managed through the FMIS.
22.2 Expenditure arrears monitoring
D
Notes:
In accordance with the FPPM all Ministries and Crown Agencies (MCAs) are required to maintain aged payables ledgers, submitted to the MFEM with the Monthly Variance Report by the 10th of the following month. This is facilitated by the FMIS allowing MFEM oversight on all payables, including their ageing—but only for those entities where FMIS has been rolled out.
Notes:
23.1 Integration of payroll and personnel records
A
Notes:
The HRMIS is fully integrated with the payroll ensuring data consistency of staff records vis-à-vis human resource (HR) and payroll functions—updates to human resource records automatically reflect in the payroll. The approved establishment as the actual staffing complement are incorporated into the HR system.
23.2 Management of payroll changes
A
Notes:
In accordance with the Financial Policies and procedures manual, timesheets and other payroll adjustments are processed fortnightly for the whole payroll of nd approved by OPSC, MFEM input payroll data for the employee and process payroll fortnightly. This happens as a matter of course and retroactive adjustments are rarely required, so MFEM does not maintain data on late payment of payroll items. central government. Once HR records are updated
23.3 Internal control of payroll
A
Notes:
There are currently three separate active responsibility profiles, SUPER (2 named users); HRADMIN (6 named users); PRADMIN (2 named users). A system generated audit trail is produced highlighting the HR and payroll activity for editing and inserting new data for the whole payroll of central government.
Notes:
The last dedicated payroll audit undertaken was in 2015/16, by Internal Audit. (for the whole payroll of central government) The purpose of a payroll audit is to specifically identify systemic HR/Payroll issues, and identify payroll data anomalies, including possible ghost workers.
Notes:
24.1 Procurement monitoring
D
Notes:
Procurement is managed through the Procurement Portal Cook Islands (PPCI). The Purchase and Sale of Goods and Services Policy (4th October 2016) and Fleet Management Policy (2018) are posted on the portal. Data is provided on current tenders, closed tenders, awarded tenders and asset sales. Data provided on awarded tenders, includes: Procuring agency; title of project; procurement method; successful tenderer; and contract price.
24.2 Procurement methods
D
Notes:
n the absence of comprehensive data on procurement, it is not possible to determine the totality of all procurement activity, with analysis by procurement method.
24.3 Public access to procurement information
D
Notes:
The MFEM Act is published on the MFEM website and Procurement Policy is published on the Procurement Portal. MFEM views the capital budget as a proxy for procurement plans. However, the budget may include spending on projects/contracts awarded in previous years; similarly spending in the current year may not reflect the full value of contracts awarded in that year.
24.4 Procurement complaints management
C
Notes:
The policy provides an escalating three-tier approach for redress from (i) the agency; (ii) the tender committee; (iii) the ombudsman. The ombudsman is not involved in the process of awarding contracts. Bidders are not charged for submitting a complaint. (3) The Policy (which is published) clearly defines the processes involved for lodging a complaint. Templates for the complaints form and the complaints register are maintained on the procurement portal website. (4) The ombudsman does not have or exercise authority to suspend a procurement process.
25. Internal controls on nonsalary expenditure
B
Notes:
25.1 Segregation of duties
B
Notes:
Segregation of duties is prescribed throughout the expenditure process. Responsibilities are clearly laid down for most key steps while further details may be needed in a few areas. More precise definition of important responsibilities particularly in reconciliation of infrastructure project expenditures may be needed.
25.2 Effectiveness of expenditure commitment controls
C
Notes:
Expenditure commitment control procedures exist which provide partial coverage and are partially effective. Commitments are controlled against the budget and cash flow only at the time accounts payable is recorded upon receipt of the invoice. Rating can be improved in future once commitments are controlled and monitored at the purchase order stage.
25.3 Compliance with payment rules and procedures
B
Notes:
Most payments are compliant with regular payment procedures. There were audit qualifications in some ministries involving lack of documentation of transactions in other expenses, and monitoring and tracking of accounts payable. There were no exceptions reported.
Notes:
26.1 Coverage of internal audit
C
Notes:
Internal audit is operational for central government entities representing the majority (57%) of budgeted expenditures and for central government entities revenue. collecting the majority of budgeted government
26.2 Nature of audits and standards applied
B
Notes:
Recently completed and ongoing internal audit activities are focused on evaluations of the adequacy and effectiveness of internal controls in the cash handling system of key agencies. Application of international standards has been mandated in the IA Charter but still in nascent stage; and quality assurance arrangements, have been identified, but not yet fully operational.
26.3 Implementation of internal audits and reporting
NA
Notes:
There were no audit activities in last fiscal year, as it was a transition period to setting up an IA process. IA processes started in 2020-2021. Performance during current year as of the time of assessment was noted though in this report.
26.4 Response to internal audits
NA
Notes:
No audit was done in last 3 years, IA processes started in 2020-2021. Performance during current year as of the time of assessment was noted though in this report
VI. Accounting and reporting
Scores by Dimension
Overall Indicator Score
27. Financial data integrity
D+
Notes:
27.1 Bank account reconciliation
D
Notes:
The reconciliations for all active government bank accounts were prepared for each month but were carried out within one to six months from the end of the month. However, there are still variances in the total balances of these reconciliations compared to in-year budget reports, and there are still large unreconciled balances in most active accounts.
Notes:
There are three suspense accounts used to temporarily record certain expenses in advance of the underlying transaction – as a mechanism to ensure the availability of funds. These are reconciled within four weeks of each month. The balances were not cleared by year-end.
Notes:
The main use of advance accounts is for CIIC Advance and Ports Authority Advance. There was only one transaction in January 2020. The reconciliation was done only within one month from the end of the financial year. Justification for not clearing these balances has yet to be provided.
27.4 Financial data integrity processes
B
Notes:
The information on Payroll/HRMIS /PayGlobal system/Unit4 Business World (UBW) was provided. A user profile list with restricted and full access to information and authority to changes to records by creation and modification. There are audit trails from the Payroll/HRMIS/PayGlobal system, with an audit trail report for payroll amendments, same report can be tailored for user profiles. Similarly, with the UBW. The Internal Audit Body carries out the verification of data.
28. In-year budget reports
D+
Notes:
28.1 Coverage and comparability of reports
B
Notes:
In-year budget reports are highly aggregated, showing y administrative, economic, and functional classification including cash and debt. Outer-island analysis and Ministries’ Monthly report are provided and show administrative headings but not consolidated. The financial position is consolidated at the end of the financial year report.
28.2 Timing of in-year budget reports
D
Notes:
In-year budget reports are produced quarterly. Ministries/Agencies submitted individual monthly budget report. Crown Team also prepares a monthly High-level report as a result of cash balance requirements during the Cook Islands COVID-19 Pandemic. Treasury provides a weekly Cash update. Timing of issuing these reports from the end of quarter and months varies, with monthly reports available within one to two weeks, whereas quarterly reports were available within three to four months after period end.
28.3 Accuracy of in-year budget reports
C
Notes:
In-year budget reports provided information on payment and commitment, Analysis of budget execution is also provided in the quarterly report. However, reconciliation issues raised on bank accounts, suspense accounts, and advance accounts may impact data accuracy.
29. Annual financial reports
D+
Notes:
29.1 Completeness of annual financial reports
A
Notes:
nancial Statements are prepared annually on an accrual basis and are consistent with the approved budget. The financial statements include a statement of financial performance showing revenue and expenditure, a statement of financial position showing financial and tangible assets, liabilities, guarantees, and long-term obligations. A reconciled cash flow statement is also prepared. Notes to the accounts include information on guarantees as well as some long-term obligations.
29.2 Submission of reports for external audit
D
Notes:
Financial reports are late and submitted for audit more than 12 months after the financial year for the last three completed fiscal years. The preparation of the 2019-20 financial statements is still in progress.
29.3 Accounting standards
A
Notes:
The financial statements are stated to be prepared according to the Ministry of Finance and Economic Act 1995-96. Financial statements comply with International Public Sector Accounting Standards unless otherwise specified in the financial statements. A Statement of Compliance is also included in the Financial Statements. There is a deviation from IPSAS regarding disclosure of low-interest concession loans. This is explained in the Notes to the Accounts, and policies are applied consistently over time.
VII. External scrutiny and audit
Scores by Dimension
Overall Indicator Score
Notes:
30.1 Audit coverage and standards
B
Notes:
Audits are done in line with audit standards and 100% of government entities in operation have been audited up to 2019. The audit of the consolidated accounts of government for 2018 and 2019 were finalised on 30th November 2020, up to more than two years after period end. Overall, the scope is estimated at over 90% of total expenditure as of last audit.
30.2 Submission of audit reports to the legislature
D
Notes:
The Audit Office has not submitted annual audit reports to Parliament for the years 2015-2019.
30.3 External audit follow-up
C
Notes:
Follow up is normally done at the next audit. Given the backlog in the audit, the audit issues raised in the audit of 2015-2017 were the same issues raised in 2018-2019.
30.4 Supreme Audit Institution independence
D
Notes:
The appointment and removal of the head of SAI is subject to the executive government. The appointment and removal of the Director or Audit is contingent on the advice of Cabinet and the Prime Minister. The involvement of the Prime Minister and Cabinet impairs the independence of the Director of Audit from the executive government. The legislation does not provide independence for the Director of Audit.
31. Legislative scrutiny of audit reports
D
Notes:
31.1 Timing of audit report scrutiny
D
Notes:
There is no evidence that Parliament scrutinized the reports from the Audit Office
31.2 Hearings on audit findings
D
Notes:
There is no evidence from Parliament of any hearings relative to the audit reports.
31.3 Recommendations on audit by the legislature
D
Notes:
There is no evidence that legislature acted on the recommendations of the last audit report.
31.4 Transparency of legislative scrutiny of audit reports
D
Notes:
There is no evidence of any Parliamentary proceedings on audit reports.