A two-year gap in the accounts of a Government quango has been criticised by a watchdog committee scrutinising the running of Bermuda?s public offices. And bafflement has been expressed as to why an accountancy firm that was performing so badly it was deemed unworthy of having its contract renewed in 2003 has been allowed to continue doing the accounts on a month-by-month basis for the National Drug Commission.

The commission?s ?antiquated? accounting system and inadequate records have compounded the problems, the cross-party Public Accounts Committee has learned.

In 2003 the NDC was a year behind with its accounts, as of today the accounts for 2003, 2004 and 2005 are yet to be done and forwarded for checking by the Auditor General. A call has been made for a restructuring and updating of the commission?s accounting records and processes and for all accountants hired to be qualified to an appropriate standard of competence. Those are the recommendations of the PAC after it inspected the National Drug Commission.

As long ago as 2004 the Auditor General called for the Health Ministry to ensure the maintaining of proper accounting records at the quango and keeping financial reporting up to date.

Yet the PAC has found the problems continue to exist.

?An accountancy firm was contracted to do the accounting work and had performed badly. That firm?s contract with the NDC had expired in 2003 but they were still working on the NDC accounts on a month-to-month consulting basis.

The NDC accounts are now some two years behind. We question why any firm would continue to be contracted to provide accounting services when it had performed poorly,? notes the PAC in its report, which has been presented to Parliament. The firm that has been allowed to continue doing the commission?s accounts, despite not having its contract renewed, is said to be ?capable as far as basic bookkeeping work is concerned, but professional standard accounting work was a problem,? according to the Health Ministry?s consultant controller who was interviewed by the PAC during its investigation.

Auditor General Larry Dennis expressed concern about the apparent lack of accounting records and information that was being given to the accountancy firm, the adequacy of the accounting systems and management controls and the professional standards of the accountants used by some managers with Government and its quangos. The NDC is soon to be integrated within the Health Ministry. The watchdog PAC has recommended: ?That the accounting structure of the NDC be given the resources to update the outstanding accounts, that accounting records be brought up to date and the requisite information be submitted to the Auditor General for completion of all outstanding audits.?

And also that: ?Consultants and other professionals, who are retained to bring accounts and accounting functions up to date, be appropriately qualified.?