Auditors listed 12 problem areas in the fiscal year 2016 audit of the Marshall Islands government, a report submitted to Nitijela last month by RMI Auditor General Junior Patrick.
The audit of the national government and all its agencies — except two, MIVA and RMI EPA, which were not ready — shows that the Ministry of Finance was successful in getting the US government to clear nearly $1.5 million in spending that had been questioned by auditors from 2010 through 2015. This was the result of Ministry of Finance engagement with US federal agencies under Finance Secretary May Bing that resulted in the questionable use of funding being cleared in March and May this year.
The government also reduced questioned spending in the current audit by nearly half, improving from over $800,000 questioned in FY2015 to $437,397 this past year. A “questioned cost” is audit language for spending by government that auditors believe did not follow US federal grant rules.
The Ministry of Finance itself reduced national government questioned spending to its lowest level since FY2012, with only $67,261 of national government spending questioned by auditors in FY2016 — in FY2015, over $600,000 in national government money use was called into question by auditors.
While the Ministry of Finance improved its control of government spending by reducing questioned costs of national government fund use, questioned spending of RMI agencies ballooned in FY2016 to over $370,000 compared to FY2015’s $200,000. This, coupled with the fact that MIVA could not be audited and EPA’s financial audit work was late, suggests some RMI agencies have an increasing level of money issues.
The FY2016 questioned spending of $437,397 added to previous years’ problem spending leaves the RMI government with over $2.5 million in spending since FY2008 that auditors say did not meet grant rules.
Historically, US government agencies that provide grant funding to the RMI have cleared most spending issues raised by auditors.
Read more about this in the September 8, 2017 edition of the Marshall Islands Journal.