State–owned Caribbean New Media Group Ltd (CNMG) has hired a debt collector to retrieve monies, totalling $6 million, owed by Government ministries and other agencies.CNMG's interim chief executive officer (CEO), Ken Ali, said that yesterday in Parliament during a meeting with the Public Accounts Enterprise Committee, chaired by Opposition Senator Fitzgerald Hinds, on the financial statements of CNMG for 2008.Ali was accompanied by accountant Arhlene Young.He was responding to a question by Senator Fazal Karim on whether the company had concerns about solvency.
Karim asked: "Is there is a concern for solvency?'Ali replied: "We have a serious issue with respect to our age receivables which is now in the region of $6 million."We just hired a firm of debt collectors to deal with that so that is an issue before us."But to answer your question about whether there is an issue of solvency, maybe less now, than possibly 2008."Ali added there were indications of a turnaround within the company since then.Asked to list the major outstanding payables, Young said she did not have a list and "we don't have anything brought forward from 2008 that is outstanding."
Regarding receivables, Young said: "We have stuff dating back to 2007."When asked to list those, Ali replied: "We have a number of Government ministries owing us."Young added there also were several agencies.She said the problem was finding the supporting documents for "some of these older things."A fumbling Young was then assisted by Ali who said CNMG had problems locating documents to state sales were confirmed and "were legal sales."
CNMG was formed in 2005 but became fully operational on June 1 2007.Ali, a former journalist, who was appointed interim CEO by the People's Partnership Government, was unable to answer several questions by committee members, saying his appointment was fairly recent but promised to furnish members with proper documentation.He said when he joined CNMG he found there were many instances of verbal bookings for the placement of advertisements.
That prompted Minister in the Ministry of National Security Subhas Panday to ask: "This is a company incorporated by law and you are taking verbal bookings?"Ali replied: "Yes, Sir."Reading from an audited document prepared by the firm. KPMG, Karim said several major issues were identified in a management letter.
He listed them as:
• No systems in place to allow for the checking, viewing and authorising of journals;
• the need for proper controls to be implemented to ensure the safekeeping of all supporting documents, including original invoices;
• the company does not have a fixed assets capitalisation policy which articulates the criteria for the recognition of depreciable fixed assets for maintenance of the fixed assets; and,
• no procedures in place to trigger a systems check to ensure the insurance coverage of assets is increased as additions are made.
Karim asked: "Who was minding this store?"