House Speaker Rafael S. Demapan (R-Saipan) said he still sees the positive side of the report presented by two independent contractors employed by the U.S. Department of the Interior-Office of Insular Affairs that gave the CNMI’s financial health a poor 2 rating.
Graduate School USA International Institute program manager Stephen Latimer and Crawford & Associates president Frank Crawford presented the Performeter Report to help the Legislature understand the CNMI’s financial health.
The U.S. Department of the Interior every year sponsors the report where those tasked to make the study and summary must develop financial management analysis of each government from the five territories.
The CNMI report, however, is based on data from 2014 where the Commonwealth, along with other Pacific Island nations, were still reeling from the after effects of the global financial crisis. The rating is expected to improve a little for 2015 even with the Internet outage and Typhoon Soudelor, which happened in succession in the third quarter of last year, affecting the result.
Demapan said despite the report being done in 2014, it would still help them and the administration to track the economic and financial status of the CNMI, and plan ahead for the future.
“It is still a good indicator with some figures remain a good indicator on our financial health. We’re going to wait for the 2015 report and use that data to see how can we further address and track the CNMI’s economic activity,” Demapan told Saipan Tribune.
Demapan said the retirement settlement being transferred to the government is one of the indicators why the CNMI scored low and added that the 2016 data would clearly show that the CNMI economy is on an upswing. “The OIA makes sure they have this status report and it will be a guide for us.”
“They [Latimer and Crawford] will have a better indication and us a more positive result once the 2016 results comes out. Anyway, the report is almost the same with the other territories. The report is not only for the CNMI but also for all territories.
American Samoa, Guam, Puerto Rico, and the U.S. Virgin Islands are the other U.S. territories.
Demapan said compiling and summarizing a one-year report is a difficult task that’s why he understands why they don’t have the latest numbers.
“Accounting is hard and very complex. It will really require you to have additional time to make sure you come up with the correct ant exact numbers. Yes, it is delayed but it is worth waiting,” Demapan said.
Crawford said they also gave the presentation to Gov. Ralph DLG Torres and the rest of his administration. “The presentation is for them to understand the financial health even though you’re not an accountant to figure it out. What we do is take the financial reports from the audit report and we basically say, ‘from the scale of 1 to 10, are we a 10 with excellent financial health or 1 with poor financial health.’”
Latimer said they developed the tool to assist governments of the five territories in assessing their financial health. “They just wanted to get an idea. It is difficult to go through the pages and papers of these financial statements.”
“They wanted to get ideas since there’s a lot of economic development happening right now. The cranes can be seen in the sky and restaurants are full, with that a lot of revenue, what are they going to do with it. Expand or settle their prior obligations and liabilities?”