Reservations on the Ministry of Finance and Planning's Disclosures in Ramallah

- From the texts of the State Audit and Administrative Control Bureau (SAACB) annual report for 2021 - reservations on Disclosure No. 10 and its annexes, regarding the Ministry of Finance and Planning's disclosures....about the public debt data, attached to the Final Account report of the State of Palestine, for the years 2018 and 2019...

- The total borrowing disclosed in Borrowing Disclosure No. 10, in the Final Account during the two years 2018 and 2019 amounted to 893,356,000 shekels, 3,175,059,000 shekels distributed as follows:

· Local borrowing during the two years 2018 and 2019 204,356,000 shekels, 1,858,911,000 shekels..

· External borrowing during the two years (2018 and 2019), in the amount of 679,318,000 shekels, 667,030,000 shekels respectively...

· The total public debt disclosed in the monthly reports attached to the Final Account as of 31-12-2018 and 2019...amounted to 11,726,600,000 shekels, 14,178,500,000 shekels, respectively...

· Local borrowing as of 31-12-2018 and 2019, in the amount of 5,034,000,000 shekels, 5,451,800,000 shekels respectively..

· External borrowing in the amount of 3,882,100,000 shekels in 2018, and 4,210,200,000 shekels in 2019..

· Balances of arrears as of 31-12-2018 and 2019: in the amount of 2,810,500,000 shekels, 4,516,500,000 shekels..respectively..

· (with the Bureau's reservation)..on the aforementioned disclosures, due to the reasons explained below, noting that most of these reservations... recur every year in the Bureau's reports for previous years..!:

· Reservations on the monthly public debt reports disclosed in the Final Accounts 2018 and 2019 (according to what the Ministry of Finance disclosed, it publishes monthly data on domestic and foreign public debt in the monthly reports which represent the status of domestic and external public debt on a monthly basis).

· Reservations on the monthly reports (December 2018 and 2019) attached to the consolidated Final Account for the years 2018 and 2019..

1- The Ministry of Finance did not disclose the source of the data, and the basis on which the reports contained in Disclosure No. 10 regarding public debt according to the monthly report for December 2018 and 2019, attached to the financial statements as disclosed in the Final Accounts, were prepared.

2- The Bureau was unable to audit the hospital balances disclosed within the monthly reports in the financial statements related to public debt for the years 2018 and 2019, due to the absence of a clear accounting policy for disclosing the payable (liability) balance for hospitals, and receivables at a specific date..and therefore inability to reconcile the balance to verify the accuracy of what appears in the public debt reports attached to the Final Account, in addition to not providing the Bureau with the working papers related to the calculation of hospitals’ receivables, and the mechanism for presenting them in the Final Account....for the years 2018 and 2019..which represents a limitation on the scope of the audit, in the ability to ensure the correctness of the amounts presented and their conformity with the confirmations received from the hospitals.!

3- The Ministry of Finance did not disclose debts due to some authorities and institutions in the Final Account for the years 2018 and 2019, and the following illustrates that:

- The Ministry of Finance did not disclose the indebtedness due to the Palestine Pension Authority within the amounts due to the Treasury, resulting from the failure to transfer amounts deducted from public employees and the government's contribution to the Authority's contributions and benefits system for the years 2018 and 2019...and the balance of this indebtedness reached 7,978,295,078 shekels..according to the external statutory auditor's report for the Palestine Pension Authority for the year 2017 (31-12-2017 last certified financial data)...and no settlement was reached regarding the said balance between the Palestine Pension Authority and the Ministry of Finance up to the date of the audit ...while the Bureau was not provided with the Authority's financial statements for 2018 and 2019...(the external auditor's report for the Pension Authority had not been issued by the audit date)..

- The amounts due to the Palestine Pension Authority resulting from the failure to transfer amounts deducted from members of the Security Forces and the government's contribution were not disclosed, as the Pension Authority does not have data on employees of the Palestine Security Forces, the deductions from their salaries, government contributions, and the amounts due to the Palestine Pension Authority for members of the Security Forces, and the transfer of employee data and their entitlements to the Pension Authority had not commenced, as provided for by the Pension Law, and no settlement was reached regarding the balance due to the Pension Authority...!

- The amount due from the Ministry of Finance to (Palestine Monetary Authority (PMA)) was not disclosed, which amounted at the end of 2018 to 2,130,287 Jordanian dinars equivalent to 11,305,859 shekels..and its value in 2019 was 2,130,287 Jordanian dinars equivalent to 10,386,214 shekels...!

- The amount due to the Palestine Investment Fund from the Ministry of Finance, amounting to 90,162,517 dollars equivalent to 339,263,520 shekels, was not disclosed, and on 31-12-2019 it amounted to 103,617,739 dollars equivalent to 358,175,438 shekels, according to the confirmations received by the Bureau from the Palestine Investment Fund (noting that the balance due to the Fund, recorded on the Bisan program at the Ministry of Finance, is 86,655,023 dollars = 326,065,521 shekels, and 102,279,561 dollars = 353,549,79 shekels in 2019..

- The amounts due to the General Petroleum Corporation for fuel supplying companies, amounting to 692,262,724 shekels at the end of 2018, and 737,106,712 shekels at the end of 2019, were not disclosed...according to the confirmations received from the supplying companies..

- The Ministry of Finance did not disclose the liability of the Palestine Deposit Insurance Corporation in terms of the unpaid amount of the Ministry of Finance's contribution to the Corporation's capital, amounting to 7,615,186 dollars = 28,654,422 shekels in 2018, and 7,615,186 dollars = 26,323,413 shekels...in addition to late payment fines due resulting from the Treasury's failure to pay the amount due to the Palestine Deposit Insurance Corporation, at a rate of 500 dollars for each day of delay, based on Article 29 of the Corporation Law for the period from 1-1-2015 to 31-12-2018..a delay of 1460 days, and accordingly the Ministry of Finance must pay an amount of 730,000 dollars = 2,746,844 shekels...and the fine for the period from 1-1-2015 to 31-12-2019, a delay of 1825 days, amounted to 912,500 dollars = 3,154,239 shekels..!