NSW Treasury forced to correct $1 billion error after leaving debt off the books

NSW’s money men left a $1 billion debt off their books, but were forced by auditors to correct the error, raising questions about the state’s finances.

The NSW government left a billion-dollar debt off its books and was forced by auditors to correct the error, a new report says.

The Treasury department agreed to borrow $1 billion from the state‘s financial authority TCorp between May and June last year, but asked that the settlement be deferred until July 1.

Even though TCorp raised the funds by June 30 and reported the loan by that date, Treasury had not yet recognised the debt, leading the two agencies’ accounts to become inconsistent.

The misstatement was one of the key issues raised by the NSW Auditor-General in a new report on Treasury’s 2020-2021 accounts.

July 1 was the start of the next financial year and recording the loan on that date would mean the debt wouldn’t show up on the books until a year later, opposition treasury spokesman Daniel Mookhey said.
“It (looks like) a naked ploy to disguise the rapid build-up of NSW debt,” he said.

“It raises serious questions about whether the government was truthful about the state of its books.”

A Treasury spokesman said the department was working closely with Auditor-General Margaret Crawford‘s office on issues raised by her in recent months.

The government’s money people were previously slammed for shoddy accounting relating to a public rail corporation which resulted in an “extreme risk finding” by Ms Crawford.
“As previously noted, Treasury secretary Dr Paul Grimes has instigated an independent assessment of the department’s processes in relation to the preparation of the 2021 state financial statements,” the Treasury spokesman said.
In her earlier report, Ms Crawford accused Treasury of providing “late, unsophisticated, and inaccurate (financial) forecasts” and withholding information.
Ms Crawford said she was only able to sign off on the state’s finances after the government plugged a $5.2 billion hole in the accounts of the rail corporation, known as the Transport Asset Holding Entity.

Originally published as NSW Treasury forced to correct $1 billion error after leaving debt off the books

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