Govt Publishes Misleading Third Quarter Financial Statements: Net Assets Would Be Zero If It Properly Reflected$2.4 Billion Of Liabilities In The Statement Of Financial Position

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By Alric Lindsay

According to the Cayman Islands Government’s third quarter unaudited financial statements published on November 8, 2024, the Government’s statement of financial position reflects total net assets of $2.3 billion as of September 30, 2024. However, this number would be reduced to zero if the post-retirement healthcare obligation was recorded there.

Evidence of this is stated plainly on page 15 of the September 30, 2024 results. This says:

Post-Retirement Health Care Cost

The estimated post-retirement healthcare obligation (at 31 December 2023) was a net $2.4 billion liability.

The actuarial valuation of the post-retirement healthcare obligation at 30 December 2023 is pending review by Cabinet and has not been recognised in the Statement of Financial Position or in the Statement of Financial Performance for Core Government.

While a freedom of information request was submitted to obtain reasons for the continued misstatement of the statement of financial position and an appeal was made to the office of the Ombudsman, no reasons have yet been provided for the non-recording of the $2.4 billion post-retirement healthcare obligation on the statement of financial position.

For members of the public following this issue, proper recording of the $2.4 billion post-retirement healthcare obligation would also impact what the Government states as surplus on its financials. Such surplus would be reduced by approximately $100 million per year.

The Office of the Auditor General has also raised a concern regarding the foregoing, however, the issue remains.

To learn more about the points raised by the Office of the Auditor General and discussions in the Public Accounts Committee on this matter, please see the previous story below.