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'Irregularities'
in Finance
reorganisation
By CRISPIN HULL
The Department of Finance
made an unlawful restrospec
tive direction arising out ot
the ministerial and de
partmental shuffle of May ,
according to a report of the
Auditor-General tabled in
Parliament yesterday.
The Auditor-General, Mr K. F.
Brigden, also found irregularities
in several other directions arising
out of the same events.
The department, whose min
ister is Senator Dame Margaret
Guilfoyle, was responsible for ap
portioning money to existing an
new departments after the aboli
tion of several departments.
The report said that on May 17
the department directed a
transfer of money made available
under Appropriation Act (No l)
to several departments for a de
fined period, but it failed to
divide up the money between the
departments concerned.
On May 24 the department
issued a direction which
"purported to rescind" the earlier
direction. It was a new order
about money made available un
der Appropriation Acts No 1 and
No 2 for a set period and divided
the money between departments.
On May 27 the department
made a direction about money
under Act No 3, but failed to
state the period of the appropria
ted July 19 it made a direction
in relation to "available moneys
appropriated by Appropriation
Acts 1981-82". The date July 19
obviously attracted the Auditor
General's attention - it was in
the new financial year.
He raised the question with the
department on August 4, and
suggested it seek the advice of the
Attorney-General's Department.
On August 31 Attorney
Gcneral's advised the direction
was invalid as "the Audit Act
conferred no powers to issue such
retrospective directions".
Ironically, the Department ot
Finance never needed to embar
rass itself by making the direc
tion. Attorney-General s advised
that at the date of the direction
there was no more money avail
able under the Appropriation
Acts named in the direction.
The department said it had
found no case where expenditure
for a given purpose exceeded the
amount approved by Parliament.
It was considering recommending
amendments to the Audit Act to
overcome difficulties imposed by
departmental shuffles.
Yesterday's report, "upon the
financial statements prepared by
the Minister for Finance , is dif
ferent from the Auditor
General's annual report, which
was tabled last month.
Mr Brigden gave a stern reply
to some statutory authorities
which had squealed about the
amount of his auditing fees,
which increased substantially in
the past year. .
"The most vigorous complai
nants in the last year have been
the Australian Dairy Corpo
ration, the Australian Overseas
Projects Corporation and the
ACT Electricity Authority," he
said.
These bodies had said they
were required by law to act on a
commercial basis. In the private
sector auditing went by tender
and the tender price was paid.
Increases were not tolerated
without significant reason, they
had said. One of them had re
fused to pay the increase.
Mr Brigden said statutory bod
ies were publicly answerable and
he had "an important function as
a provider of information essen
tial in ensuring accountability of
government-owned enterprises".
"I shall be asking the ministers
to which the authorities report for
assistance in recovery of outstan
ding audit fees," he said.
Mr Brigden frowned upon
some private-sector practices.
"I do not think that present,
and developing, relationships be
tween auditors and the boards of
some private-sector companies
are as they should be, and cer
tainly they should not be im
ported into the public sector," he
said.
On computers, he said dif
ficulties were being experienced
with the recruitment, training
and retention of auditors to deal
with increasingly complex sys
tems. The extent of computerisa
tion and the growing diversity of
computing equipment was also
causing problems.
He reported also on aspects of
the Department of Foreign Af
fairs and the Department of Pri
mary Industry. The Australia
New Zealand Foundation trust
account had been overdrawn by
$6,829 in breach of the Audit
Act. Investments paid out of the
Wheat Research Trust Account
exceeded the available balance in
the account by up to 52 million
for about five months in the fi
nancial year "attributable
basically to the Department of
Primary Industry's failure to
maintain an effective control over
trust accounts". He criticised the
Department of Finance's ledger
system for making this possible.
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