The Court of Auditors has refused to approve the 2023 and 2024 management accounts of the Madeira Social Security Institute (ISSM), extending the situation to five consecutive financial years. The Institute’s accounts for 2020, 2021 and 2022 were also denied approval.
In its decision concerning the 2024 accounts, the Madeira Regional Section of the Court of Auditors concluded that the limitations identified during the audit made it impossible to verify whether the financial statements provided a “true and fair view” of the Institute’s financial position.
The Court’s decision does not necessarily mean that all the figures in the accounts are incorrect. Rather, auditors were unable to obtain sufficient reliable evidence to confirm their accuracy and completeness.
Among the problems identified were weaknesses and limitations in computer systems and internal controls. These prevented auditors from fully reconciling amounts relating to contributors, beneficiaries and other outstanding receivables.
For the 2024 financial year, the statutory auditor was unable to obtain reasonable assurance regarding €63.662 million recorded under these categories.
Although the audit acknowledged that improvements had been made to some internal procedures, it continued to identify shortcomings in the financial information provided. These included the absence of an actuarial study calculating the Institute’s future pension liabilities and the omission of some information required under the accounting standards governing public administrations.
The Court reached the same conclusion regarding the ISSM’s 2023 accounts. It found that the auditor’s disclaimer of opinion meant that the reliability of the Institute’s reported financial and economic position could not be confirmed.
A similar problem was identified in the 2022 accounts. In a report approved on the 1st of February 2024, the Court said its examination had not established that the financial statements presented a true and fair representation of the Institute’s financial position.
The Court had previously refused to approve the ISSM accounts for 2020 and 2021, citing comparable concerns.
The Institute challenged some of the latest findings, arguing that several of the limitations arose from information systems managed nationally rather than directly by the regional organisation.
However, the Court concluded that the ISSM’s explanations did not resolve the limitations identified by the statutory auditor. As a result, it declined to approve the accounts, continuing a pattern that now covers the five financial years from 2020 to 2024.
Samantha Gannon
info at madeira-weekly.com
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