A computer server crashed just before the 2015 general election wiping out all the Community Based Environment and Protection and Enhancement Programme’s (CEPEP) records for 2010 to 2015. Hundreds of files also went missing, a container was found outside of an office with destroyed files in it and a previous auditor refuses to return CEPEP’s documents.
This situation faced CEPEP management who took office in 2016 and affected their ability to produce audited financial statements, Parliament’s Public Accounts (Enterprises) Committee (PAEC) heard yesterday.
Some of it was described as sabotage by PAEC members Keith Scotland and Amrita Deonarine when CEPEP officials appeared before them to discuss the state company’s financial statements.
Scotland, as well as Permanent Secretary in the Local Government Ministry Desdra Bascombe and deputy Permanent Secretary in the Finance Ministry Charran Narine, all said CEPEP should take legal action against its previous auditor, named as Hardy’s and Associates.
PAEC chairman Wade Mark had earlier chastised CEPEP officials for non -submission of audited financial statements for 2014- 21. CEO Keith Eddy, noting the 2015 server crash, said all financial information from 2010- 2015 was lost and it took two and a half years to obtain data to rebuild the systems.
Eddy said there were also problems with the previous auditor who refused to return CEPEP’s documents. He said it took additional time to bring in a new auditor but statements from 2015 to current are being completed.
Mark, declaring the situation was “indefensible, inexcusable and intolerable,” claimed CEPEP, which spent $1.5 billion from 2015 to 2021, had “gone rogue”. But Eddy didn’t agree, citing the hardships encountered.
CEPEP senior financial officer Gary Stoddard said all financial accounts up to 2021 have been completed and reports to the Local Government and Finance Ministries are being submitted.
“So all current reporting is up to date,” he said, pointing out that information about the server crash had been sent to the PAEC before.
Eddy added that if CEPEP had gotten back its documents from the last auditor, the situation would have been resolved.
“The only thing we haven’t done is report them to ICATT,” he said
Bascombe recommended legal action against the auditor as the only way to recover CEPEP’s data. She said the server crash occurred just before the 2015 general election when CEPEP was under the Housing Ministry.
Narine, who said the Finance Ministry was aware of CEPEP’s problems including the server crash, agreed that legal action might be warranted.
Scotland said the accounts are CEPEP’s property and the company needs to be more “bullish” with an errant auditor.
Eddy said he would take Scotland’s advice: “I agree that those working papers do belong to CEPEP, it’s not the auditor’s. We’ll still go after it to ensure we have those working papers so we can always have checks and balances in place.”
PAEC member Renuka Sagaramsingh-Sooklal said the documents were confidential and expressed concern about what a “rogue auditor” might do with the information
In response to a question from Deonarine about why no other hard copy records were available, Eddy said CEPEP’s new management met the server crash.
“Nobody knew what happened, you’d have to ask those who were there to say,” he said.
CEPEP senior internal auditor Alicia Austin interjected: “I went in and looked for a lot of old documents to aid in rebuilding when we realised what had happened and a lot of documents were missing, hundreds of documents.”
Eddy added: “Also, we found a container on the outside where things were just destroyed. It was a hazard. We just don’t know, we can’t account to tell you what would have happened to that information.”
Deonarine told him: “Mr CEO, based on what you’re saying here, this is making me think this was pure sabotage.”
Eddy said the documents that were destroyed were from 2012-2015.
Scotland said the “ghost” situation was unacceptable and had hamstrung CEPEP’s ability to produce accounts. He said the PAEC needed to resolve the matter .
Scotland asked what was done to prosecute the sabotage. Eddy said it wasn’t reported to the Fraud Squad, only to the line ministry.
“We must get to the bottom of this. When you see documents in a drum that raises a red flag,” said Scotland who added that the previous auditor should also account for CEPEP’s documents and return them.
“It’s not theirs. We need an enquiry on this,” he said.
Mark said the PAEC would ask the Auditor General to do a forensic probe. He also said before action is taken the PAEC would have ask the previous auditor to appear before them. However, Scotland pointed out that the auditor might refuse so CEPEP should first act within a fortnight.
Eddy said CEPEP, as well as the new auditors, wrote the previous auditor but got no response. The previous auditor had also refused to appear before a Parliamentary committee.