Urip Hudiono, Jakarta – The Supreme Audit Agency (BPK) has slapped a disclaimer on the government's 2005 annual budget accounts, citing continuing glaring problems as regards transparency and accountability in the management of the state finances last year.

It means the agency has for six consecutive years slapped a disclaimer on the government's annual budget accounts.

A lack of access to audit tax revenues, the continued existence of obscure government bank accounts, and irregularities in transferring state assets and liabilities were particular reasons for the disclaimer, the BPK said in its audit of the 2005 budget accounts, which it submitted to a House of Representatives plenary session Tuesday. The agency also noted ongoing weaknesses in the government's own internal audit system, and several incidences of non-compliance with financial accounting procedures.

The audit was carried out on Rp 851.9 trillion (US$92.6 billion) worth of state assets, Rp 1,349 trillion of liabilities, Rp 497.1 trillion of equity, Rp 403.3 trillion of revenues, Rp 427.1 trillion of expenditure, and Rp 20.7 trillion of deficit financing.

The disclaimer comes despite the government having implemented a new balance sheet accounting system, and could affect the credibility of President Susilo Bambang Yudhoyono's administration in implementing its better-governance agenda.

"It looks like little has changed since the New Order era," BPK chief Anwar Nasution told reporters after submitting the audit results, referring to the country's three decades of infamously corrupt bureaucracy under former President Soeharto.

"The government still has a lot to do so as to improve budget transparency and accountability, and to follow up on our audit findings and suggestions."

Since 2000, the BPK has always given a disclaimer to the government's accounts, including to the 2004 budget accounts, which were the first to follow the improved accounting system established by the State Finances Law (No. 17/2003). The BPK and the House had mostly served as little more than rubber stamps during the New Order era.

Last year's budget was the first to be both drafted and managed by Yudhoyono's administration. The 2004 budget was drafted by former President Megawati Soekarnoputri's administration.

Anwar said that the BPK's main objection to the 2005 budget accounts, which had led to the disclaimer, was the fact that the agency had been prevented by the General Tax Arrangements and Procedures Law from thoroughly auditing Rp 347 trillion in tax revenues and Rp 29.22 trillion in uncollected tax revenues.

The BPK also found a total of 1,303 savings and deposit accounts holding some Rp 8.54 trillion held under the private names of government officials, rather than the names of their institutions, with the purpose of many of the accounts being questionable.

Further on, the agency noted weaknesses in the government's internal audit system arising from the existing patchwork of accounting systems, most of which were incompatible with one another. All of this resulted in the inadequate reporting of, among other things, government investments worth Rp 393.1 trillion in state firms, Rp 130.2 trillion in Bank Indonesia, and Rp 60.3 trillion in the regions.

There was also incomplete reporting of disbursements and allocations worth Rp 11.4 trillion for foreign debt payments, Rp 4.25 trillion for subsidies, and Rp 446 billion for unrealized project spending.

Although the BPK's disclaimer has no concrete legal consequence for the government, it nevertheless constitutes something of an embarrassment.

Finance Minister Sri Mulyani Indrawati said in the budget accounts, however, that the government was continuously working on ways to improve the management of the state finances.