DELAYS in reconciliation of the bank accounts of the revenue collection agency have seen potential Government revenue for fiscal year 2020/21 not properly brought to account, according to the findings of the Auditor General Department’s (AuGD’s) examination of Tax Administration Jamaica’s (TAJ’s) books for the period.

“TAJ was not consistently performing the required monthly reconciliation of its bank accounts in accordance with the financial instructions. We noted that TAJ took as much as 191 days and 148 days, respectively, to prepare and review the bank reconciliation statements for the nine banks’ accounts that were in operation,” the AuGD said in a report on its examination of Government’s accounts across the public sector up to March 31, 2021. The 152-page report was tabled in the House of Representatives on Tuesday.

According to the report, which also contains an assessment of the AuGD’s performance for December 2020 to November 2021, a review of the TAJ’s last bank reconciliation statements showed erroneous debits and credits totalling $13 billion and $39.8 million for 2020/21.

Auditor General Pamela Monroe Ellis said the TAJ had advised that the delay in the preparation of the bank reconciliation statements was mainly due to high staff turnover in the bank reconciliation unit and that all bank reconciliation statements would have been brought up to date by October 31, 2021. The TAJ has also promised to reclassify staff positions to improve retention. Subsequent to the audit, the TAJ advised that it has commenced direct communication with bank management to resolve the erroneous amounts on the statements and implemented a new method of processing direct bank debit, which requires the taxpayer to provide information such as their tax registration number so that the TAJ can link individuals to payment.

The agency says it has also contracted a consultant to review the operations of the revenue accounts unit and the administration of online payment systems, given the increasing shift to those types of transactions. It also advised that a committee has been formed to oversee the progress of the strategies that are being used employed to address the issue of unidentified deposits and erroneous debits.

The TAJ has also breached established accounting practice and procedures, the auditors said, by failing to record deposit vouchers to the government financial management system in a timely manner.

Monroe Elis says failure to have in place an effective monitoring system for deposit accounts could result in misuse of funds, and overdrawn and fraudulent activities. The TAJ took between 32 and 56 days to record transactions in 2019/20, and as much as 88 days in 2020/21. The agency said it would have updated deposit accounts by the end of December 2021, noting that a transition period to move from a manual deposit, to electronic ledger system.