VIDEO: OPA Denies Vice Speaker’s Request for Audit Draft, and Denies Senator’s Claim She Called It “Election Year Auditing”

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Guam – Guam Public Auditor Doris Flores-Brooks has denied Vice Speaker B.J. Cruz’s FOIA request for a copy of the initial draft of the Government of Guam Financial Statements for FY 2013. 

In her response, the Public Auditor explains why by writing that “the irresponsible use of draft documents … could be used to mislead the public.”

The Vice Speaker believes that original draft shows that GovGuam suffered a more than $20-million dollar deficit in 2013, and not the $2-million dollar surplus shown in the final report, a document that the Senator charges is full of  “many misrepresentations and flaws.”

In a brief 1 page response posted on the OPA website, Flores-Brooks writes “as Public Auditor I deny the charges you made in your letter and assure you that the Office of Public Accountability has acted ethically and in accordance with the accounting standards you cited in your letter.”

READ the Public Auditor’s response to Senator Cruz’s FOIA request HERE 

Among the “charges” Flores-Brooks denies which Cruz made in his Thursday FOIA letter,  is that Flores-Brooks told him during a July 17th meeting that the GovGuam Financial audit had been the subject of  “‘political manipulation.'” And the Senator calls on the OPA to publicly acknowledge what he says she said in private to him.

“While you had made these assertions to my face,” writes Senator Cruz, “you have been unwilling to recognize them publicly.”

The Vice Speaker goes on to write that Flores-Brooks’ “failure to openly address the flaws you acknowledged to me in private undermines the integrity of your office, the very concept of an independent audit , and the basic belief that our government’s financial statements should not further a lie.”

READ Vice Speaker Cruz’s letter to Public Auditor Flores-Brooks HERE

Specifically, the Vice Speaker points to a generally accepted accounting rule which states that “revenues are considered to be available when they are collected within the current period,  or soon enough thereafter, to pay liabilities of the current period. For this purpose, GovGuam considers most revenues …  to be available if they are collected within 90 days of the end of the current fiscal period .”

Yet, the Senator says, during a July 10th review of the GovGuam Financial audit, Deloitte & Touche recognized as 2013 revenue “$22,869,385 in additional “Section 30 Funds” even though at least $15 million of that amount was still uncollected as of July 14 of this year.

A violation, the Senator points out, of that 90-day rule. These “Section 30 fund revenues were recognized and recorded over two hundred sixty ( 260 ) days after the close of FY 2013.” And he charges that Flores-Brooks acknowledged that Deloitte’s decision to recognize these Section 30 funds, nearly 6 months beyond the 90-day rule, “fundamentally altered” the audit.

“As you explained to me,” writes Senator Cruz, “because Deloitte permitted the recognition of additional Section 30 revenues after the initial draft version of the final audit report was provided to you, the cumulative deficit disappeared and a cumulative surplus was created an example of what you called  ‘election year auditing’.”

Included in the documents released by the Senator is a letter from Deloitte Partner, Dan Fitzgerald, who acknowledged in his July 29th letter to DOA Director Benita Manglona and Public Auditor Flores-Brooks that  “the $15 million was … inappropriately recognized as revenues.”

 

 

In her response, the Public Auditor explains that “the irresponsible use of public documents … can be used to mislead the public.”