Bridge project issue for B.C. auditor general
British Columbia's auditor general says the province has not been following its commitment to stick to the gold-standard of accounting principles.
Finance legislation requires the government to follow generally accepted accounting principles, but the auditor general has found this did not happen in the case of the Port Mann Bridge.
John Doyle also warns that with new accounting regulations on the way, B.C.'s deficit could grow because of the way rate-regulated entities such as B.C. Hydro may have to be accounted for.
Doyle noted in his report released Thursday that if the new regulations were already in place, it would have meant an extra $400 million on B.C.'s deficit for 2010-2011.
"If government had not been permitted by current accounting standards to defer certain expenses, government's annual deficit would have been approximately $400 million higher this year," Doyle said.
Finance Minister Kevin Falcon announced in July the province had ended fiscal 2010 with a $309-million deficit compared to the $1.7-billion deficit forecast in the budget. Falcon was not available for comment on the auditor general's report Thursday.
Doyle said that in the case of the Port Mann Bridge, the government improperly classified the Transportation Investment Corporation, which is responsible for building and managing the project.
However, in a response included with the report, the government disagreed.
The statement said that because the corporation will support its operation from toll revenue collected from users, not from government subsidies, its operations should not be included in the province's summary financial statements.
"We believe that the Transportation Investment Corporation is best disclosed as a government business enterprise," the government said.
The new 10-lane bridge has been controversial, and critics have said the government has failed to budget for it.
Doyle also said gaming grants should be disclosed on financial statements according to the purpose of the grant rather than being classified in the "other" category. That would properly reflect the intended use of the grant, Doyle said.
The report also contains recommendations from the financial statement audits of more than 150 government organizations.
- A previous version of this story wrongly said the government's deficit should have been reported as $400 million higher.Sep 29, 2011 10:50 PM PT