Public mismanagement is squared with a word

Ecuadornews:

The accounts of the public sector do not match and the gap reaches 118 million dollars. An item has been detected, under the name “difference”, with which the Non-Financial Public Sector reconciles the shortfall in the effective flow. For the Comptroller’s Office it is an accounting anomaly, indicated in a report that reviews the accounts until December 2015, approved in July 2017.

In other words, accounts square in accounting when zero comes out by subtracting expenditures and cash in income, summarizes Francisco Swett, former finance minister. In this case, there are 118 million dollars whose fate is unknown that prevent the reconciliation of accounts.

The Comptroller’s report breaks this amount down and attributes it to each person responsible. The public companies are 93.9 million dollars, $ 24.2 million to the Decentralized Autonomous Governments and $ 679,000 to the General Government. 

This annotation is added to the irregularities detected and identified by the control entity in another report that was presented last week and that, apart from raising the debt figure above the constitutional limit, reveals the legal maneuvers that the previous Government undertook to adapt the regulation to your economic needs. The gap of 118 million dollars is, in the opinion of the analyst of Pulso Economico, David Castellanos, a figure “quite high” for which there is no accounting support.

That is, there is no support that explains how these public resources have been spent. Therefore, the Office of the Comptroller General states in its report that “the public entities that make up the Non-Financial Public Sector, in the registry of its operations, did not correctly apply the accrual principle”, committed “errors in the process of standardization of accounts in the statement of cash flow “, contrary to the” governmental accounting regulations “.

According to Castellanos, reconciling the box with this “difference” is what is known as “square machete,” a practice “not appropriate considering that it is public resources.” For this reason, it is regulated for State entities to apply the accrual principle, which, in simple language, is equivalent to recording and justifying the expense incurred at the time it occurs.

This mismatch “reflects the difficulties, restrictions and unreliability of the accounting of the entities that make up the non-financial public sector and, especially, of public companies, which currently reflect large losses that are covered by transfers from the State budget and that, they constitute an important factor of the public deficit “, points Jaime Carrera, director of the Observatory of Fiscal Policy. The same ex-Minister of Finance, Carlos de la Torre, when he was still in office, attributed the lack of reliability to the reason why the aggregate debt figure has not yet been published. “We are encountering surprises.

We have to go and search every data, make sure that the registry is complete, incorporate the floating debt that was not registered, we have to be sure of what its commitments are, how many are … “, said the former minister to the digital portal of Magazine Management.

Report 

Exam 

The analysis of the Comptroller General of the State refers to the accounts of the Non-Financial Public Sector as of December 31, 2015.

Approved 

The report is approved on July 7, 2017 and signed by the Director of Audit of Sectional Development and Social Security, 

Content 

The 140-page document presents a breakdown of the figures in the financial statements (income, expenses, investments …) of the public sector companies. (I)

Source: http://www.expreso.ec/economia/empresas-sectorpublico-deudas-contraloria-HK2084801