CEDA gets good independent audit findings
The Commonwealth Economic Development Authority has received a good audit from an independent auditor on its internal control over financial reporting.
The Burger Comer & Associates recently informed the CEDA board of directors that during their audit they did not identify any deficiencies in internal control that they consider to be material weaknesses.
The independent auditor, however, said material weaknesses or significant deficiencies may exist that were not identified.
The Office of Public Auditor hired Burger Comer & Associates to conduct an audit on CEDA’s statement of net position as of Sept. 30, 2021 and the related statements of revenues, expenses and changes in net position and of cash flows for the year then ended and the related notes to the financial statements. OPA released the audit report on Wednesday.
Burger Comer found that CEDA’s financial statements present fairly the respective financial position of the CEDA as of Sept. 30, 2021 and the respective changes in net position and cash flows for the year then ended in accordance with accounting principles generally accepted in the USA.
Burger Comer & Associates said the results of their tests of CEDA’s compliance with certain provisions of laws, regulations, contracts, and grant agreements, disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
The auditor said there are no unresolved findings from prior year audits of CEDA.
Burger Comer noted that CEDA discloses the economic uncertainties that have arisen as a result of the COVID-19 pandemic declared by the World Health Organization.
The auditor said their opinion “is not modified with respect to this matter.”
CEDA said it is affected by the negative economic forces at play globally as well as locally.
CEDA said the CNMI’s economic resiliency was also tested when it was able to recover quickly from two major natural disasters.
The agency noted that the effect of the ongoing trade war between the U.S. and China and the global impact of the pandemic in health, economy and tourism has not spared the CNMI which brought the Commonwealth’s economic activity to a near stand-still as countries around the world imposed tight restrictions on movement to contain the spread of the virus.
CEDA’s biggest challenge in the past was funding its operations from earnings generated from its loan portfolios and investments, and that management addressed this problem through a combination of revenue enhancements and diversifications and expenditure reductions.
According to CEDA, as of Sept. 30, 2021 and 2020, its Development Corporation Division’s net loans receivable was $7.77 million and $7.22 million, respectively.
As of Sept. 30, 2021 and 2020, CEDA received total dividend payments of $9.72 million and $8.10 million from the Commonwealth Utilities Corp.
In August 2016, CEDA and CUC entered into a settlement agreement directing CUC to assign the payment it receives from the Public School System settlement agreement and to pay the remaining difference of $478,798 to CEDA.
CEDA said CUC further agrees to make quarterly dividend payments of $270,000 to CEDA beginning on Oct. 1, 2016.
As of Sept. 30, 2021 and 2020, CEDA had $810,366 and $860,569, respectively, of net investment in capital assets. This represents a net decrease of $50,203 or 6% during fiscal year 2021 and of $269,717 or 3% during fiscal year 2020.
As of Sept. 30, 2021, CEDA’s total assets was $44.65 million and total liabilities was $7.25 million, or for a total net position of $37.39 million.
As of Sept. 30, 2020, CEDA total assets was $43.88 million and total liabilities was $6.61 million, or for a total of net position of $37.27 million.
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