Stronger IIA Guyana Chapter needed – former President
… says real sectors’ non-performance affects financial sector
A stronger Guyana Chapter of the Institute of Internal Auditors (IIA-Guyana) is needed to better represent its members, according to Deodat Indar, the Chapter’s
former President and current President of the Georgetown Chambers of Commerce and Industry (GCCI). He made the recommendation at the opening of a two-day seminar and workshop for internal auditors.
The two-day workshop and seminar commenced on Wednesday at the Regency Suites Hotel and would see auditors being given crash courses in dealing with the evolving risks facing organisations, ethics and governance for auditors, financial auditing for internal auditors and inventory and stores management.
“Although there were successes, there are some clear failures. The Chapter still looks for a permanent home; I task the new Board to do what the past leaders did not do and fulfil this objective,” Indar said.
“A much stronger and visible Chapter is needed and when internal auditors are faced with push back in their own firms for doing their jobs, the IIA-Guyana must be the last bastion of defence to come to their aid and mediate and advocate for members of the profession,” he added.
Indar called upon the participants to examine the broader risk frameworks affecting their business and to come up with strategies to address those risks. He said the Committee of Sponsoring Organisations of the Treadway Commission (COSO) mandates internal auditors to audit strategies to determine the effectiveness of their companies.
“It makes no sense to have a strong robust internal system and you are suffering competitively and can face closure,” he said.
Meanwhile, current President of the IIA-Guyana, Goorwantie Devi Kaladeen, said the mission of the IIA is to provide dynamic leadership for the global profession of internal auditing through advocacy, research and education. She notes that the workshop is the first of three for the Guyana Chapter year, which started on June 1 and will end on May 31, 2018.
“At the local level, since the resuscitation of the Guyana Chapter in 2009, the Chapter has been holding seminars/workshops annually to enlighten our participants on the updated developments in the practice of the Internal Audit Profession, thereby becoming more efficient in their working environment,” she said.
The Guyana Chapter currently has 80 members, with seven being certified internal auditors, one certified Government-auditing professional and six accredited risk management assurance certification.
The IIA is a global professional association with over 185,000 members in more than 190 countries around the world. The Global Headquarters is located in Florida. The Global Board of Directors, 20 committees and more than 270 chapters and institutes serve IIA members at the volunteer level. This includes 139 chapters in the United States, 12 in Canada and one each in Aruba, The Bahamas, Barbados, Bermuda, Cayman Islands, Cura?ao, Guyana, Jamaica, Puerto Rico, Trinidad and Tobago and Turks and Caicos.
Real sectors’ non-performance
Despite recording a 2.2 per cent economic growth for the first half of 2017, Indar said he is concerned about the non-performance of the real sectors, which have drastic impacts on the financial sector.
The International Monetary Fund (IMF) staff report June 2017 for Guyana indicates that the non-performing loan ratio rose to 12.9 per cent of total loans at December 2016, up from 1.5 per cent at the end of 2015.
“If you check the non-performing loans and check the areas where they are suffering most, you will find agriculture, real estate, rice and mining are creating defaults in the system. Now banks have to provide for them and once they have to provide for them then they have to deduct it from their profits and it is tightening up things. The real sectors have to perform and if they don’t perform, then you will have problems in the financial sector and no Guyanese wants that,” he explained.
This, according to the GCCI President, represents a serious problem, which will result in banks starting to tighten lending, indicating bad news for the Private Sector and households. Indar explained that although the economy grew by 2.2 per cent for the first half of 2017, the breakdown is a bit worrying.
According to the Bank of Guyana, rice production grew by 31 per cent in 2016 due to rising acreage, sugar production wend down by 12.4 per cent while other crops grew by 2.5 per cent. In addition, forestry contracted by 18.2 per cent while the mining and quarry industry went down by four per cent.
These trends, according to the GCCI President, indicated that there are job losses owing to the non-performance of the major sectors. The workshop concludes today.