The Samoa Housing Corporation’s (S.H.C.) bad debts spiralled in the 2010 financial year, the Controller and Chief Auditor has reported.
In his 2011 report to the Legislative Assembly, Fuimaono C.G. Afele says he Corporation’s net profit increased slightly by one per cent compared to the prior year’s net profit.
“Total income and total expenses both increased by 5.3% and 6% respectively,” the report reads.
“Bad debts have increased significantly from $8,613 to $148,916.”
In spite of this, Fuimaono reports that the financial position of the Corporation had improved.
“The cash flow position had improved with a reduction in the net decrease in cash compared to the prior year.”
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The S.H.C. did respond to the Chief Auditor addressing the issues he raised.
Looking now at S.L.A.C., Fuimaono reports that its financial position had improved slightly with a one per cent increase in total assets.
“Total liabilities have also increased by 0.9 per cent,” according to the report.
“Some arrears in mortgage repayments were not shown in the Arrears Report.”
SL.A.C. also responded to Fuimaono, addressing the issues he raised.
Both reports are republished in full below:
Housing Corporation
Financial year:
30 June 2010
Audit opinion: Unqualified
Auditor: Audit Office
Summary of audit findings:
1. The Corporation’s net profit increased slightly by 1% compared to the prior year’s net profit. Total income and total expenses both increased by 5.3% and 6% respectively. Bad debts have increased significantly from $8,613 to $148,916.
2. The financial position of the Corporation had improved.
3. The cash flow position had improved with a reduction in the net decrease in cash compared to the prior year.
4. Monthly bank reconciliations for the bank account held with a local commercial bank were not reviewed. This resulted in discrepancies that were only resolved during the bank reconciliation for the final month of the financial year.
5. Some relevant loan documents such as pay slip, confirmation letter, consent letter from guarantor and bank statements, were missing from loan files reviewed.
6. Some loan files were either missing or misplaced and could not be located for audit purposes
7. Supporting documents for some payments were either missing or incomplete
8. The Corporation responded as follows: • Issues 1 to 3 - Confirmed and agreed; • Issue 4 - Existing internal controls have been strengthened; • Issues 5 to 7 - Existing procedures in connection with the indicated weakness had been revitalized and improved.
9. Samoa Life Assurance Corporation
Financial year: 30 June 2010
Audit opinion: Unqualified
Auditor: Betham & Co
Summary of audit findings:
1. The Corporation’s financial position had improved slightly with a 1% increase in total assets. Total liabilities have also increased by 0.9%.
2. Some arrears in mortgage repayments were not shown in the Arrears Report.
• The Corporation responded that the matter on arrears in mortgage repayments not shown in Arrears Report had been closely monitored by management. As a result, the monthly Arrears Report correctly reflects the position of mortgage arrears and this issue had been resolved in period ended 30 June 2011.
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