September 28, 2022

The Caribbean Actuarial Association and the Institute of Chartered Accountants of Barbados collaborated to issue
an important article on the Barbados National Insurance Scheme. 

Take a Read

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(Note: This article was shared on IFAC's Knowledge Gateway )

ICAB's Lessons Learned from Public Financial Management Reform in Barbados

Lydia McCollin, Immediate Past President and member of the Public Sector Committee, ICAB 
August 31, 2022

As a professional accountancy organization (PAO), the Institute of Chartered Accountants of Barbados (ICAB) has,
for many years, collaborated with the Government of Barbados in its efforts to improve the country’s public financial management (PFM) system. While there have been a number of success stories resulting from that collaboration,
Barbados is on a continuous PFM reform journey with more work still to be done.

In recent weeks the Report of the Auditor General for 2021  identified a number of areas of concern with respect to accounting practices and financial reporting by the Treasury and some state-owned enterprises (SOEs). This report triggered much discussion and debate on PFM in Barbados and underscored the need for increased efficiency, accountability, and transparency in public financial reporting.

The heightened interest in PFM by the citizens of Barbados must be applauded. This public interest emphasizes why PFM is a strategic priority for ICAB, and why ICAB is committed to continuing to collaborate with the government to progress reforms.

How did ICAB get started on this journey of collaboration with the government on PFM reform?

In 2007, the Parliament of Barbados enacted the Financial Management and Audit Act , which adopted the accrual basis International Public Sector Accounting Standards (IPSAS) as the financial reporting standards for the Barbados public sector.

ICAB’s first major step in working with the government was serving on a steering committee for IPSAS implementation during the move from a cash-based to an accrual system of accounting. Through this engagement, ICAB recognized the need to deepen its focus on accounting and auditing issues in the public sector. Therefore in 2011, ICAB’s Council approved the creation of a Public Sector Committee as one of its standing committees, comprised of accountants in government and business and auditors.

The first chair of the Public Sector Committee was Mr. William Layne, an ICAB member and former Permanent Secretary of the Ministry of Finance. Under his chairmanship, the immediate priorities of the committee were to:  

(i)              Create relevant continuing professional development (CPD) for public sector accountants;

(ii)            Establish joint initiatives with government agencies; and

(iii)          Promote membership of ICAB to professional accountants in the public sector.

The Public Sector Committee worked with other committees to expand CPD offerings for public sector accountants beyond IPSAS, including seminars in internal controls and internal auditing, preventing corruption, enhancing accountability and the role of the auditor general, and pensions reform.

The work of ICAB’s Public Sector Committee caught the attention of colleagues in the Institute of Chartered Accountants of the Caribbean (ICAC). As the first PAO in the region to have such a committee in place, the chairman of ICAB’s Public Sector Committee was invited by ICAC to share with other Caribbean PAOs ICAB’s experience in working successfully with the public sector to promote good governance, accountability, implementation of IPSAS and other best practices.

The second major step was taken when the Public Sector Committee broadened its focus on PFM reforms to wider governance issues confronting the public sector. This was marked by an inaugural ICAB Public Sector Conference in 2018, co-hosted with CPA Canada and titled Public Financial Management (PFM) Reforms in Barbados – Challenges and Opportunities. The conference provided ICAB members access to international experts in matters relevant to the public sector, such as digital technology, governance, transformational leadership, PFM reforms and financial reporting. This conference now has a permanent place on ICAB’s calendar of events, with the next public sector conference scheduled on September 16, 2022. This will focus on the Public Procurement Act 2021, the Consolidation of Financial Statements under IPSAS and more.

The third major step occurred after the enactment of the Public Finance Management Act 2019 (PFM Act) , which replaced the Financial Management and Audit Act 2007. The new PFM Act is aimed at strengthening and improving PFM and includes new provisions related to the reform of SOEs, particularly in the areas of governance, finance, and reporting.

The ICAB president at that time, Lydia McCollin, along with the Public Sector Committee, held discussions with the Ministry of Finance to determine how ICAB could work with the government in this next important phase of PFM reforms. In November 2019, ICAB submitted a proposal to the Ministry of Finance outlining how ICAB—through its members, partnerships with professional qualifying bodies and other professional associations—could add value, provide guidance and assist the government in implementing its initiatives in the areas of corporate governance, financial accountability, reform of SOEs, training and certification for public sector finance officers, institutional strengthening of finance departments, and internal audit.

As a follow-up, ICAB also submitted to the Ministry of Finance a Corporate Governance Framework for SOEs and a paper on establishing audit committees at all SOEs for consideration and further discussion. Additionally, ICAB’s CPD schedule included training on accounting fundamentals and practice to increase efficiency and effectiveness in financial reporting in the public sector.

 

 

What lessons can be learned from the ICAB experience in supporting reforms in public financial management?

First, as a small PAO with limited resources, much can still be achieved by drawing on the time and talents of members through committees. The ICAB Public Sector Committee is one of the newer committees but its clear mandate and ICAB’s governance polices have facilitated its strong performance in support of PFM reforms and contribution to the professional development of ICAB members in the public sector.­­­

Second, while changes to laws, regulations and accounting policies are necessary for PFM reform, they are not sufficient to ensure success. Those high-level changes must be supported by clear interpretation and articulation of accounting policies by senior management, training and development for staff at all levels, changes in administrative procedures, and timeliness and accuracy in reporting at all levels.­­­

Thirdly, the ICAB’s experience has shown the importance of celebrating the reform’s successes, even while still struggling with the more difficult and slower aspects of reform. This can be an inspiration to the agencies and individuals who still have their “mountain to climb” with their own reforms.



 

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The Auditor's General's Report - Urgent Action Required by Government

July 15, 2022

The underlying theme in the Auditor General’s Report – 2021 appears to be a lack of good governance. This is of serious concern as a lack of good governance can derail any attempt that Barbados has towards sustainable development. If this goes unaddressed, Barbados will continue to need the intervention of external agencies and may never fully be able to reduce unemployment or have its social programs and policies achieve their intended objectives.

By way of background, under the Public Finance Management Act 2019-1 (the Act), one of the roles of the Barbados Audit Office is to conduct an audit of Government’s financial statements. This office is headed by the Auditor General. The Act states clearly the criteria for reporting including such rules as dates for financials to be presented and standards to be followed. Yet, according to the Auditor General, he received accounts late and some agencies did not follow the applicable reporting standards. Notably, the Auditor General stated that “These financial statements would therefore be misleading to a user.”.

The Auditor General is to be commended for bringing these matters to the fore and this work will be of no benefit to the people of Barbados unless swift action is taken by Government to implement the recommendations contained in the report. While other agencies have publicly commented on the report, there has been a notable silence on the part of Government in responding to any of the many issues raised to date.

One of the hallmarks of good governance is the ability to make informed decisions based on the availability of timely and accurate information. This requires adequate and effective internal processes and controls to be in place. The implementation of basic controls in a deliberate and consistent manner would be a good first step to create good governance.

Government has a responsibility to the people of Barbados to be able to demonstrate that it safeguards the assets to which it has been entrusted and that it operates transparently. Best Practices dictate the existence of adequate supporting documentation and a clear audit trail surrounding transactions.

With additional pressures being put on Government to provide support to the most vulnerable in the wake of COVID-19 and the Russian-Ukraine war, it is vital that Government manages its finances in the most prudent manner to always create sustainable development. We believe that Government needs to have a detailed collaborative review with the relevant Ministries, Departments and Agencies to address the issues raised in the report. The Institute of Chartered Accountants of Barbados (ICAB) commends Government on the recent appointment of Mr. Oliver Jordan as the Special Advisor for the Reform and Restructuring of State-Owned Enterprises. It is hoped that positive change will result from this including bringing the many long outstanding audits up to date.

ICAB hopes that Government will quickly take further actions to resolve the various issues raised in the Auditor General’s Report, in particular those that have been raised in successive reports. In this regard, ICAB continues to stand ready to be of assistance to the Government in whichever way necessary and to put into practice the slogan of the 2004 Barbados National Sustainability Development Policy “Doing the right things by doing things right”

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New Council 2022 – 2023 of ICAB

June 10, 2022

The Institute of Chartered Accountants of Barbados (“ICAB” or “the Institute”) held its 48th Annual General Meeting (AGM) on Thursday June 9, 2022. The AGM was held using an electronic platform with online voting.

ICAB is pleased to announce that at a meeting of the Council held after the AGM, Ms. Darshani Workman was re-elected President for 2022-2023.

Ms. Workman who is Finance Manager of Deloitte and Touche Barbados, is a Fellow of ICAB and is a Fellow of the Association of Chartered Certified Accountants (ACCA). She was appointed to Council for the first time in 2017, and is currently a member of the Legislation Committee. Ms. Workman has also been a volunteer with Optimist International since 2009 and has served on its Audit and Finance Committee in 2018-2020.

Upon her re-appointment Ms. Workman expressed her thanks to her fellow Council Members for their support and congratulated the newly elected Council members of Council and the members of the Executive Committee. During her tenure as President, Ms. Workman will focus on setting out the strategic plan for the next 3 years focusing on financial sustainability, member engagement, policy advocacy, communications, regulation in the public interest, continuing professional development, and information management and security.

Ms. Workman also plans to have the Institute explore ways to foster financial literacy within the public as any improvement in financial literacy will have a positive and profound impact on people and their ability to provide for their future.

At the meeting of Council, Ms. Tracy Marshall was elected as Vice-President, Mr. Damien Skeete as Secretary, and Mr. Sirpaul Jaikaran as Treasurer. Former President Ms. Lydia McCollin is the Immediate Past President. Ms. Marshall is an Assurance Partner at EY Barbados, Mr. Skeete is an Audit Partner at Skeete, Best & Co., Mr. Jaikaran is an Assurance Partner at PwC East Caribbean, and Ms. McCollin is Managing Director and Lead Consultant of LRM Consulting Services Inc.

ICAB is led by a 15-member Council whose other members are Shirlyne Alexander, Lisa A.C. Alleyne, Ricaido Jennings, Christina John, Fiona Jones, Marilyn Husbands, Roger Kirton, Khalil Patel, Wendell Scantlebury, and Wendy Sealy. ICAB’s programmes are run by a 5-member Secretariat, led by its Executive Director, Kathy-Ann Hewitt.

ICAB is the professional membership organisation representing approximately 1,080 Chartered Accountants in Barbados along with approximately 800 students pursuing professional accounting qualifications. ICAB is the regulator and standard setter for accounting and auditing in Barbados. It is a body corporate created by the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974 (Cap 369A) on November 1, 2974. ICAB is committed to global best practices and to continuously enhancing the reputation of the profession and the reputation of Barbados through effective leadership in key areas including regulation, advocacy, member services, and active engagement in matters of national interest.