BRA found wanting
A total of $1,368,327 in bounced cheques was presented for payment to the umbrella Barbados Revenue Authority (BRA) last year.
However, according to Auditor General Leigh Trotman, there was no evidence to show that any effort was made by the island’s umbrella revenue collection agency, led by Revenue Commissioner Margaret Sivers, to recover the outstanding amounts, as required by the country’s financial rules.
“This will result in the Authority having difficulty in collecting the outstanding funds, since the longer amounts are outstanding, the more difficult it will be to recover them,” he said in his latest audit report for 2015.
“Payments by cheques which were subsequently dishonoured were not adjusted in the relevant taxpayers’ accounts. The lack of adjustments of these payments will understate the amounts due by taxpayers, and result in the loss of penalties and interest which would usually be incurred on amounts due. The overall effect would be an understatement of the accounts receivable,” he added.
In terms of its overall revenue, BRA reported a total of $2.02 billion for the year ended March 31, 2015. However, the Auditor General said no documentation was presented in support of 67 per cent of that amount or $1.35 billion.
Furthermore, BRA’s records also show that $55,997,381 was paid in refunds during 2015, whereas the Statement of Revenue showed that $48,044,464 was paid.
Noting that this was first year that the Revenue Authority after it was formed on April 1, 2014 as a result of a merger of the operations of The Land Tax Department, The Value Added Tax Division, The Inland Revenue Department and aspects of The Customs and Excise Department, Trotman said there was need for adjustments to the statements provided going forward.
“The Authority needs to separate the financial reporting of its operational activities from the activities that it has been set up to administer.
“The Authority must take a closer look at its outstanding receivables. The figure reported was in excess of $750 million and, in order for my Office to verify this amount, it must be given full details.
“In addition, the Government has adopted an accrual basis of accounting and the revenue statements should reflective this,” the Auditor General recommended.