The Berbice Bridge Company Incorporated (BBCI) has signaled its intention to institute an almost 400 percent increase in tolls for various classes of vehicles, freight and boats. Yet, its financial statements for 2018 remain unknown. This salient fact was recently pointed out by Chartered Accountant, John Seeram.
According to Chairman of the Guyana Chapter of the Institute of Internal Auditors (IIA-Guyana), BCCI’s move to increase the tolls was hinged on the fact that it has up to $6 billion in debts including dividends to shareholders, and accumulated losses in excess of $2.8 billion. Further, BCCI said that private sector entities have contributed $5.1 billion/US$24 million and the overall cost, which includes the approach roads, was about US$40 million.
In this regard, Seeram said, “I have seen private sector entities publishing their Audited Financial Statements with Accompanying Notes in the news media. Presently, there has been no publication of the BBCI’s Audited Financial Statements to support the ‘numbers’ the Chairman of BBCI (Dr. Surendra Persaud) has been mentioning. What a disaster! Tolls are to be increased at the most alarming rate, yet no one knows how they were determined. May I state that best practices globally will adopt gradual toll increases, for example, 20 to 30 percent in year one, 15 to 20 percent in year two, etc.”
The Chartered Accountant continued, “The citizens of Guyana need to be updated by the Chair and the Board of BBCI of its financial position, its operations, and its cash flows at 30 June 2018. In order to justify the massive increase in tolls, it should disclose its latest audited Financial Statements and its Interim Financial Statements to 30 June 2018. The Financial Statements I am referring to are the Statement of Financial Position, the Comprehensive Income Statement, the Statement of Equity, the Statement of Cash Flows, and the Accompanying Notes to support those four Statements.”
Seeram added, “I am not saying that the numbers are not true. But they have to be extracted from the Financial Statements, hence let’s see them. Further, no mention was made of a time period and the audited period for the numbers disclosed.”
Once this is done, the Chartered Accountant said that financial analysts will be in a position to determine through key performance indicators, BBCI’s true financial position, its operations whether profitable or not, and its cash inflows and outflows for the period under consideration. In justifying a toll increase,
Seeram said that one has to determine and evaluate BBCI’s returns on equity and on assets, its net operating margin of income or loss, its debt to equity relationship, its long-term debt to total capitalization, to mention only a few. Further, on shareholders’ equity, Seeram questioned if there are preferred stockholders, if any dividends were paid, and if so, how much to date.
In closing, Seeram said that the time has come for BCCI to be transparent.