Mark Dodd – An audit of East Timor's public finances by Darwin-based accounting firm Deloitte Touche Tohmatsu has uncovered $189 million worth of discrepancies, raising serious concerns of financial mismanagement by the Gusmao government.

The international accounting firm gave a "qualified" sign-off to its August 31 report, which found massive underspends by government ministries and two unreconciled amounts totalling $73.2m and $116.7m respectively.

The findings involve missing tax receipts, inadequate working documents and records, inadequate records of salaries and government payments including pensions.

The report is an embarrassment to the UN and to Australia which has set "improving public financial management" as an aid priority to Dili.