S.W.A. incurred $11.3 million debts in 2013
The total debts that the Samoa Water Authority incurred for the financial year ended June 30, 2013 totaled $11.3 million, which was an increase from $9.6m recorded in the previous year.
The provision for doubtful debts also increased from $3.35 million to $4.85 million in 2013, which is a 44 per cent increase.
This is according to the Audit Office Report to Parliament for financial year 2015. The auditor’s report pointed out that the over-90-days balance is approximately $6.48 million and this balance is an increase above the balance of the previous year of $4.8 million.
“The increase in the over-90-days balance is a deteriorating statistic for the accounts receivable,” the auditor’s report stated.
The Authority indicated in its response to the concerns that it takes an average of 467 days to recover debtor accounts, and added that their revenue collection efficiency (R.C.E.) has improved compared to previous years.
“In previous years, R.C.E. was around 80 per cent and below. In 2012-2013, it was 91 per cent yet in 2012 - 78 per cent and continues to improve in July 2013 - 105 per cent and August 2013 at 94 per cent.”
The Authority also stated that it provides on a yearly basis $1.5 million to $2 million for accounts that are considered doubtful.
“This yearly additional provision will also cover any increase in accounts receivables as noted above. We prefer this method, instead of booking it all in one year, as it will have a significant effect on that year's results.
“In general, the increase in receivables can be related firstly to the monthly generation of bills commencing 2009-2010, compared to prior quarterly and secondly wastewater in 2011-2012. Work in Progress costs of $12.6 million differ from Finance Cost of $15.64 million,” the auditor’s report added.
The audit report further stated that no assets were written off following the aftermath of Cyclone Evan in December 2012.
“A note has been inserted into the financial statement as subsequent events after balance date. S.W.A. explained that only temporary repairs were done in the financial year 2012-2013 and was categorised as a $3.8 million loss.
“The $8.8 million damage was the estimate of permanent works to replace the damaged infrastructure which will be implemented 2013-2014 upon arrival of materials,” added the report.