Auditor General Larry Dennis has criticised a ?serious lack of accountability? among Government-controlled organisations.

From the 14 Government-controlled organisations, known as quangos, operating in March 2005, Mr. Dennis reports that just seven had issued audited financial statements for that year by January 2006.

?That represents a serious lack of accountability,? he said in his annual report, released yesterday. He raised detailed concerns about audits completed for 2004-2005 by Bermuda College, Bermuda Hospitals Board, Bermuda Housing Corporation, the Board of Trustees of the Golf Courses, CedarBridge Academy and the former National Drug Commission.

Late financial reporting among schools and Parish Councils also came in for flak.cleared some of its backlog by completing its 2003 financial statements this January. Mr. Dennis said the delay was caused by ?major uncertainties? caused by a poorly-worded agreement under which the former Stonington Beach Hotel was leased to a private operator ? a deal that caused major political controversy when details of it later emerged.

Mr. Dennis said he was worried the college had an ?inappropriate? investment policy for certain donated funds. In response, the college said its investment policy was being revised.

The financial watchdog acknowledged progress made by in tackling many accounting and control issues raised in past audits. However, he urged the board to continue to address weaknesses in its patient billings systems.

?The board also needs an improved fraud prevention and detection policy and computer back-up arrangements,? the annual report states.

Hospital management stated in the report that billing was now the responsibility of the clinical records department, which was hiring staff to perform this task. It also agreed that the fraud policy needed revising and that a new whistleblower policy had been drafted but approval was still needed.

He said the ? which was shrouded in a scandal that led to worker Terrence Smith getting convicted of defrauding the Corporation of more than $1.2 million ? had made strides in addressing previously reported accounting and control weaknesses.

But he said accounting efficiency was still hampered by an outdated and unreliable computer system and server. Uncertainties needed resolving about the value and ownership of certain capital assets, he added, and these arose after the ?complete breakdown? in the Corporation?s management controls in 2002.

The Corporation said that the computer system should have been replaced ten years ago and new systems were being looked at. And it said that documentation on assets was a long-term problem that could not be addressed quickly because of complexities involved and resources currently available.is four years in arrears, although the report states that the 2002 audit is substantially complete and indications were that records for the following three years were ?much improved?.

Accountancy control of capital assets were still weak, the report stated, and concerns were raised about how annual operating losses at the Ruth Seaton James Auditorium were ?draining? the Academy?s cash resources.

In reply, CedarBridge said that a count of capital assets was planned for 2005/6 and that a study on alternative funding arrangements for the venue was nearing completion.

The watchdog hailed the for bringing its reporting up to date, filing three years of financial statements from the three years ending March 2004.

The Auditor General, however, raised ?deep concern? about the financial affairs of the former , whose remit is now covered by the Ministry of National Drug Control.

?Serious accountability arrears, inadequate records and controls, late provision of information and lack of co-operation with the audit process have combined to cast serious doubt on the integrity of the audit environment,? remarked Mr. Dennis. Long-running complaints about accounts continue, with the watchdog calling the situation a ?mess? and casting doubt on the effectiveness of a Government push to speed up the process.

?By January 2006, not one parish council had managed to issue audited financial statements for the year ended March 2005,? the report states.

?Only three of the nine parish councils had issued statements for the year ended March 2004.

?And all this despite the Department of Health and Family Services employing an international firm of chartered accountants to provide accounting services to the councils and prepare their financial statements.?

In 2002, the Auditor General asked whether parish councils still served a useful community purpose. Mr. Dennis, noting evidence of poor attendance at PC meetings in his latest report, added yesterday: ?In my view, most parish councils are working to their irrelevance.?

Recently released figures reported in showed that that Government paid $287,000 to KPMG for preparing Parish Council accounts. Mr. Dennis also reserved criticism for schools and said that by the end of January, St. George?s Preparatory was the only aided school to issue accounts for the last financial year.

Sandys Secondary Middle School, Berkeley Institute and Whitney Educational Trust were one, two and three years respectively behind with their books, the report stated.