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Page 11

Part Two Oversight and Reporting Responsibilities

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Source: Extracts from the Childcare Protection Regulations 2007

2.3 CDA received 41 applications between November 30, 2012 and August 22, 2013. We gleaned from a status report dated June 24, 2014, that 25 facilities had submitted all the required documents. However, we observed that CDA did not make any effort to visit these homes, within the prescribed 28 days after receiving a completed application, with a view to conducting an assessment of the facilities. Under the Regulations, CDA is required to make arrangements, within 28 days after receiving a completed application, to visit the proposed premises of the home, for the purpose of conducting an assessment. CDA is to notify the proposed operator of the home of the date, time and place for the operator to attend an assessment for the purpose of determining the applicant’s suitability to operate a children’s home. Subsequently, CDA informed us that 32 homes have now submitted all documents required and were recommended for licensing. In addition, we also found that four new children’s homes did not submit the complete set of documents for licence. One of the four new facilities is operational. We found no evidence that CDA is making a determined effort to ensure that the facilities with outstanding documents comply with the requirement. CDA commissioned a comprehensive audit of the homes and the decision was taken to await the results of the audit to inform the renewal of licences. The audit was completed in September 2013.

CDA was not consistently reporting on its performance to the portfolio Ministry 2.4 CDA was not consistently fulfilling its reporting responsibilities to ensure timely reviews of its

performance. At September 2014, We found that CDA did not prepare annual reports for the last four financial years, 2010-11 to 2013-14. In addition, CDA is required to prepare and submit quarterly operational reports to the portfolio Ministry. However, CDA was not consistent in preparing and submitting the quarterly operational reports. Subsequent to the audit, CDA informed us that the outstanding annual reports will be completed by September 2015 and that all quarterly reports have been submitted to the Ministry. CDA further advised that the portfolio ministry is kept abreast of the performance of the agency through quarterly reports presented to the Executive Management Meetings, which is chaired by the Permanent Secretary. However, if the requisite reports are not submitted on a timely basis it could prevent the oversight bodies from acting promptly to remedy any inappropriate activities within childcare facilities.

Oversight of childcare facilities not adequate

2.5 Two critical mechanisms to strengthen CDA’s oversight framework for the monitoring of childcare facilities and reporting on deficiencies were not in place. CDA established an Advisory Board in accordance with Section 5(1)(b) of the Executive Agencies Act. The Board is responsible to advise the Chief Executive Officer in the strategic and business planning responsibilities of the Agency. However, we found that an Advisory Council was appointed in accordance with Section 85(1) of the Child Care and Protection Act 2004. Section 86(1) of the Act sates that the duty of the Council, in its discretion, is to advise and report to the Minister on any matter which, in its opinion, affects the proper carrying out of the provisions and objects of the Act. The Advisory Council should also serve as an independent oversight body to ensure the operations of all childcare facilities conform to the relevant childcare regulations and standards of care. Section 12 of the Child Care and Protection Regulations

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Page 2

Part Six – Corporate Governance - INSPORTS

43 Auditor General’s Department Special Audits - March 2017

the Houses of Parliament. INSPORTS has never submitted Annual Reports, and the last audited financial statement prepared was for the financial year 1991/1992. INSPORTS, by its non-submission of the statutory Annual Report and Audited Financial Statements for 23 years, has deprived the portfolio Ministry and Parliament of its oversight function regarding the financial and operational performance. INSPORTS failure not only breached the Law, but is worrying from a fiduciary responsibility position, given that its accounting records showed that for the six-year period 2005-06 to 2010-11, total revenues amounted to $1.4 billion, while expenditure totalled $1.5 billion. While INSPORTS’ Board established a Finance and Audit Committee, it did not engage an Internal Auditor to undertake the necessary review of internal controls as part of its corporate governance responsibility. The lack of proper controls of financial management, including maintenance of accounting records also contributed to INSPORTS’ inability to enable the preparation of financial statements for the last 23 years.

2. Board">INSPORTS Board did not develop “specific and measurable objectives and performance targets” as required by Section 6(1) (c) of the PBMA Act. INSPORTS did not include any performance targets in the Operational Plan for 2012-13. INSPORTS outlined 27 performance targets, in its 2013-14 Operational Plan, for the promotion and development of seven sporting disciplines. However, there was no evidence such as minutes or annual reports, to indicate that INSPORTS assessed the achievement of targets set for sports promotion and development. Hence, we could not assess whether these targets were achieved or whether the outcomes informed its 2014-15 Operational plan. Therefore, we were unable to ascertain how INSPORTS satisfies itself that: it is fulfilling its mandate to develop sports in schools and communities; and contributing to the achievement of the Vision 2030 National Strategy for sports development in Jamaica.

3. INSPORT’s Board operated without a Charter36, while its sub-committees did not have in place terms of reference (TOR) to define the roles and responsibilities of the directors, including their responsibilities for corporate governance, as required by the GoJ Corporate Governance Framework. The oversight of INSPORTS operations was impaired by the failure of the Board and its sub-committees, to convene regular meetings to effectively direct and monitor the strategic and financial operations of INSPORTS. For example, during the financial year 2015-16, the Board only met twice, in May and October 2015 and the Board met seven times in each of the financial years 2013-14 and 2014-15 and six times in 2012-13. To its credit, Board">INSPORTS Board established the Corporate Governance and Human Resource sub-committees in 2013 and a Finance and Audit Committee in 2012. However, we found no evidence that the Finance and Audit Committee met or took action to protect the financial assets and report on the effectiveness of the administrative and accounting controls despite its fiduciary duty to do so.

36 Recommended Practice No. 1 (PRINCIPLE 2 -ROLES AND RESPONSIBILITIES OF THE BOARD)

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Page 22 Performance Audit

JUTC: Governance, Procurement and Operations Management July 2020

Legislative Context

2.1 JUTC is a limited liability company incorporated under the Companies Act of 1998. The entity operates under the Transport Authority Act (1968) and the Public Passenger (Kingston Metropolitan Transport Region) Act. Under the Public Passenger Transport (KMTR) Act. JUTC currently operates through an exclusive licence within the KMTR; any other bus operators wishing to operate within the KMTR must do so as a sub-franchisee with the consent of the JUTC. At end-June 2019, JUTC’s management indicated that it was awaiting written confirmation to a request to the MTM for the renewal of the exclusive licence which expired in September 2018.

JUTC was partially compliant with Corporate Governance Framework and PBMA

2.2 The Corporate Governance Framework for Public Bodies, 2012 states “Each Board of a Public Body should be subject to a formal and rigorous annual appraisal of its performance and that of its committees and individual Directors. The Ministry of Finance & Planning should develop a Performance Evaluation Template to be used by all Boards”. However, we found no evidence to indicate that this activity was performed during the review period. The failure by the MTM to ensure that such an evaluation was conducted limited the ability of the Ministry to effectively monitor the performance of the Board against expected results, manage risks and advise/inform the Minister1.

2.3 The Corporate Governance Framework recommends that the board members declare any conflicts of interest in keeping with the established Conflict of Interest rules identified in the Code of Ethics. Upon inspection of the Board minutes, the declaration of conflict by the members to the chairman was first recorded in board minutes on November 1, 2018. The minutes indicated that no conflict of interest had been declared during the review period.

2.4 We found that the Ministry of Transport and Mining (MTM) had not developed a competency profile for the Board of the JUTC, for the period under review. We expected the competency profile for the Board to be consistent with that outlined in the Competency Profile Instrument for the Boards of Public Bodies (MoFPS, January 2017). We requested the information from the Ministry on December 2, 2019, which indicated that it had not been advised of the Instrument being brought into effect but had requested the information and would thereafter move to implement a regime for administering the Instrument.

1GoJ Corporate Governance Framework, PRINCIPLE 15: MONITORING ARRANGEMENT OF MINISTRIES

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Page 65

Audit Observations and Recommendations

Auditor General’s Department – Annual Report – 2007/2008 58

weaknesses could contribute to the loss of public resources. Management was advised to implement corrective measures. Overpayments 242. Two (2) officers were overpaid a total of $47,109 in relation to salary and gratuity payments. Management was advised to effect recoveries. Advance payments on Gratuity 243. Three officers were granted advance payments totalling $1,076,657 on gratuity before the end of the first year of their three-year contracts in breach of the contract requirements of payment upon successful completion of contracts. This action also contravened Ministry of Finance’s guidelines. Outstanding Advances 244. Six persons had outstanding advances totalling $602,197 for periods in excess of a year. In addition, there was no evidence that the staff loan/advances policy was approved by the Ministry of Finance. Board of Directors 245. The Council’s Board was dissolved in March 2006 and a new board has not been appointed since, thus denying the Council proper guidance in its operations. Fixed Assets 246. a) Inventory records did not always contain pertinent information such as the cost of assets, acquisition dates, serial numbers assignees and location numbers and assets were sometimes not marked with the departmental codes. Management was advised of the need to improve the controls in order to safeguard the Council’s assets.

b) An officer who was in receipt of full upkeep had possession of one of the fleet

vehicles on a continuous basis. This matter has been the subject of previous audit reports.

PROFESSIONS SUPPLEMENTARY TO MEDICINE 247. An audit of the captioned entity for the year under review disclosed that the administrative and accounting functions were performed by the Ministry of Health due to irregularities discovered in the prior period. The following weaknesses were identified.

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June 09, 2021


Page 22

22 Auditor General’s Department Special Audit – Nutrition Products Limited (NPL)

Unauthorised Payment of Board Fees

3.5 We observed that NPL overpaid a former board member fees amounting to $119,500 for the period July to November 2011. The officer ceased being a board member on June 30, 2011 but was paid fees up to November 2011. The NPL subsequently requested the individual to repay the amounts as shown in Table 12. At the time of the report, the amount was not recovered.

Table 12: Overpayment of board fees

Date Meetings ($)

Travelling ($)

Meal

($)

TOTAL

15.7.11 24,000.00 8,400.00 2,800.00 35,200.00

9.8.11 3,500.00 2,100.00 700.00 6,300.00

11.8.11 3,500.00 2,100.00 700.00 6,300.00

19.11.11 8,500.00 2,100.00 700.00 11,300.00

16.9.11 15,500.00 6,300.00 2,100.00 23,900.00

11.10.11 3,500.00 2,100.00 700.00 6,300.00

13.10.11 3,500.00 2,100.00 700.00 6,300.00

21.10.11 8,500.00 2,100.00 700.00 11,300.00

8.11.11 3,500.00 2,100.00 700.00 6,300.00

10.11.11 3,500.00 2,100.00 700.00 6,300.00

77,500.00 31,500.00 10,500.00 119,500.00

NPL Engages Contractors in Breach of the GOJ Procurement Guidelines

3.6 We found that NPL contracted the services of three contractors, to provide transportation services for workers on the night shifts (Table 13). A review of the contracts for the period April 1, 2011 to March 31, 2013, revealed that the contractors were not registered with the National Contracts Commission (NCC) in the related category. Further, NPL failed to produce evidence that the contractors are Tax Compliant in accordance with GOJ’s procurement guidelines.

Table 13 Schedule of the contracts signed between NPL and the contractors

Contractor Period of Contract Seen on File Contract Value

Contractor No. 1 – Kingston April 1, 2011 - March 31, 2013 1,460,379

Contractor No. 2 - St. Mary April 1, 2011 - March 31, 2013 1,296,000

Contractor No. 3 – Westmoreland April 1, 2011 - March 31, 2013 1,592,000

Collectors Contracted in Contravention of NPL Guidelines

3.7 NPL guidelines allow the engagement of collectors to collect, from schools, contributions outstanding for over sixty days7. However, NPL’s Operations Manual and the existing contracts with collectors, allow for the collection of all contributions due and payable to

7 NPL Guidelines for the Operations of the Nutri-bun Component of the School Feeding Programme (Page 12)

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