Nicosia, Cyprus. The audit office said delays in submitting and auditing public financial statements have left thousands of reports pending, including nine dating to the 1990s. In a report issued on Thursday, it called for faster completion to support transparency and accountability.
Pending statements from the 1990s
The audit office said nine financial statements concerning the activities of state organisations in the 1990s remain pending for audit. The report said four of the statements are from school boards and five are from other organisations, covering the period between 1995 and 1999.
Backlog from 1999 to 2023
The report said that between 1999 and 2023, exactly 6,734 financial statements remain pending for audit. It said the majority concern village councils, with large minorities also concerning municipalities and school boards.
Obligations and timeliness
“The submission of financial statements to the auditor general is a fundamental obligation of public sector entities and aims to ensure transparency, accountability and solid financial management,” the audit office said. It added that the audit of these financial statements should be completed as soon as possible so the auditor general’s opinion is timely and relevant, enabling competent entities to take relevant measures.
Use of private auditors and reported weaknesses
The audit office said that since 2014 it has been empowered to assign the auditing of those financial statements to private auditors, while retaining the option to conduct additional or other audits at its discretion. It said that essentially between 2014 and 2025, it acted as a coordinating and contracting authority through procedures assigning audits of public entities’ financial statements to private auditors, with the exception of institutions directly tied to local government.
The report said analysis showed substantial weaknesses in the overall effort, leading to the accumulation of a large number of unaudited financial statements.
Status of pending cases
Of the more than 6,000 statements pending audit, the report said 81% were assigned to private auditors but have not yet been audited. It added that in 14% of cases state institutions have not submitted a financial statement, while in the remaining 5% the reports have not yet been assigned to private auditors.
What steps should public institutions take to ensure financial statements are submitted and audited on time?