From the Office of the Auditor General

Governance in the Cayman Islands Government – Describing the Framework

EXECUTIVE SUMMARY

Governance of a public sector entity is critical to its ability to operate effectively and to achieve results. As part of our programme of audit work we have undertaken a broad ranging audit of how the governance framework has operated across the Cayman Islands Government. However before audit work can be done to determine how well the governance framework is operating, it must be understood how it works.

The purpose of this report is to describe the governance framework of the Cayman Islands Government. It describes the governance framework as reflected in the Constitution, the Public Management and Finance Law (PMFL) and the Public Service Management Law (PSML) without commenting on its effectiveness, relevance and appropriateness.

This report provides the basis for the other audit  work we have carried out to determine the extent to which management policies, practices and procedures have been developed and implemented to fulfill the intent of the framework. In other words are all legislated responsibilities being followed and is the accountability framework operating as intended?

Following on from this report  we have issued three other reports which examine the: operational effectiveness of governance in core government; operational effectiveness of governance related to the relationship core government has with Statutory Authorities and Government Companies (SAGCs); and a survey of the state of governance in SAGCs.

The first report focuses on core government and has sought to determine whether the core government governance framework is being applied in practice and whether it meets good governance principles for public organizations as appropriate for the Cayman Islands.

The other two reports relate to Statutory Authorities and Government  Companies. The first looks to determine whether statutory authorities and government companies are meeting the constitutional and legislative requirements for accountability to core government and whether these arrangements meet good governance standards, as appropriate for the Cayman Islands. The second focuses on the governance frameworks within statutory authorities and government companies and used a self­ assessment approach to determine the extent to which their governance frameworks meet good governance standards and support the achievement of their strategic goals and objectives, and the fulfillment of their legislative mandate.

I hope that the description of the governance framework contained in this report, and the findings from the other three reports on how the framework is operating in practice, will be useful to members of the Legislative Assembly and enable the Government to drive forward ongoing improvements in how its undertakes its activities and manages resources.

SUMMARY

232. In describing the governance framework around the administration of public resources in the Cayman Islands Government, I found that there is clear roadmap for the officials involved to carry out their roles and responsibilities. Like most legislative frameworks, there is a clear need for government policy and procedures to be put in place to ensure that the principals and objectives of the governance framework are met.

233. It is my hope that the description of the governance framework will assist Members of the Legislative Assembly and the public to better understand how public resources are to be managed and when making changes to the framework, what impact those changes might have on the objectives and principles envisioned in its creation.

234. Further reports on the governance of public resources in the Cayman Islands Government will focus on the implementation and management of the governance framework.

See Appendix 1, 2 & 3.