I made my maiden speech to the Assembly at the States Meeting in July 2012. It was on the subject of the States Accounts for 2011 that had been laid before us for approval.
Sir,
The Insititute of Chartered Accountnats once engaged consultants to find out why people perceived them as boring. After months of surveys and in depth analysis, the consultants came back to them with a report of many hundreds of pages – however, the executive summary was short – the reason that people perceive accountants as boring is that accountants ARE boring!
Given that the Minister of T&R and myself are both Chartered Accountants I would like to think that we are either the exceptions that prove the rule or, perish the thought, the consultants had already made up their minds before they wrote their report.
I appreciate that the current Minister had no involvement in the preparation of Accounts for 2011, as I had no involvement prior to their being signed off by the States Auditors. However, as the current Chair of the PAC, I feel I should make a few points regarding what we have presented to us now and how I hope things will progress in the next few years.
It became evident reading these accounts that whilst comprising over 300 pages, they demonstrate a fundamental lack of transparency and do not provide the Members of this Assembly with the information that they need in relation to the assets in their care.
Whilst we can find details of assets in various miscellaneous accounts, these appear nowhere in the main balance sheet or notes. There is, therefore, no single statement that gives the current picture of the state of Guernsey Limited.
Is it right that these accounts show no properties owned by the States? Is it right that capital expenditure is put through an income account and how can the States hold £2bn of investments but nowhere is this total disclosed, no summaries from the investment managers provided, no analysis of risk strategy or investment structure and not even a portfolio statement.
How can States departments properly determine what capital investment in new assets is required or what level of maintenance work on existing assets is necessary if they have no idea of the value of properties held. This building is not represented in the accounts, neither are schools, the police station, prison or hospitals. This is like a diverse conglomerate failing to provide consolidated accounts.
Is it any wonder the people of Guernsey question major expenditure when they have no means of relating this to the value of the assets involved.
I was delighted that one of the last acts of the previous States was to agree to resource accounting and budgeting and to adopt IPSAS (or International Public Sector Accounting Standards) I suppose the fact that such news makes me excited might help reinforce the Chartered Accountant stereotype.
Seriously, a meaningful set of accounts that follow generally accepted accounting principles and provide accountability and transparency for which we all strive is long overdue.
However, bringing in resource accounting and budgeting will not be easy and this complexity is reflected in a not insubstantial budget of £1.3m and a project life of 4 years. As the minister will know only too well from his many years of filling in time sheets, time is money and we literally can’t afford for this project to overrun.
It is with this in mind that i would like to seek assurance from the Minister that PAC will be kept fully informed as to progress of the project and at that same time would like to offer the help and support of PAC in establishing a set of financial statements that are not only true and fair but also meaningful and useful to enable the States and its government to run its affairs in a business like manner.