The 2023 Pacific Games audit report will be handed to Solomon Islands Police for investigation.
Solomon Islands auditor-general David Teika Dennis told Honiara-based Solomon Business Magazine (SBM) that findings from the special audit into the Games would be sent for further investigation.
Dennis revealed the National Hosting Authority (NHA), the government body responsible for organising and delivering the 2023 Pacific Games in Honiara, did not adhere to the requirements of the Public Financial Management Act 2013 (PFMA 2013).
According to the audit findings, the NHA also did not adhere to the prescribed financial management processes when expending public funds for the hosting of the 17th Pacific Games.
“The Court ruling makes it clear that Special Funds, as public money, unless explicitly required otherwise by Parliament, must comply with the Public Financial Management Act,” Dennis said.
“It follows from this ruling that all accountable officers of special funds, including for the Sports Solomon Fund, must have a valid warrant to be able to lawfully incur expenditure.
“I will be referring these matters for further investigation,” he said.
The Games were held in Honiara in November and December 2023 and were the first Pacific Games hosted by Solomon Islands.
However, a number of serious weaknesses in procurement and financial management processes surrounding the Games were identified in the special audit report.
These inlcuded findings that most contractors did not provide adequate financial information to support an assessment of their financial capacity, while contracts allowed between 30 and 50 percent of the contract value to be paid upon signing, before goods, services or works had been delivered.
The report said these weaknesses increased the risks of delivery failure, financial loss, regulatory non-compliance and abuse, plus weakening safeguards designed to prevent shell entities, related parties, inexperienced suppliers or unsuitable suppliers from benefiting from public expenditure.
One of the biggest cases identified in the report was the controversial procurement of toilet paper for the 2023 Pacific Games.
It was one of the five contracts where competitive bidding was bypassed.
Dennis said the procurement for the supply and delivery of toilet paper initially involved a contract amount of SB$6.18 million (NZ$1.2m), despite being linked to an overall budget of only SB$300,000 (NZ$58,000).
The contract was later reduced to SB$1.89m (NZ$370,000), but the revised amount was still significantly above the available budget.
“Without approved budgets and clear cost estimates, the Authority could not show that spending was planned, affordable, justified or value for money,” Dennis said.
“This creates conditions where inflated prices, excessive variations, unnecessary spending or preferential treatment may not be detected. I will be referring these matters for further investigation.”
The five contracts in question totalled SB$29.61m (NZ$5.8m) and that included catering services at SINU Panatina and Kukum; Septic waste removal and servicing; Catering services at St Joseph Tenaru; U-Drainage improvement; and the supply and delivery of toilet paper.
He said the report would be referred to the police for further investigation and further action if need be.
