The Guam Ancestral Lands Commission received an unmodified, or clean, audit opinion for its fiscal year 2023 financial statements, according to an audit released Feb. 10 by the Guam Office of Public Accountability (OPA.) While the opinion found the financial statements fairly presented, auditors issued a management letter citing a deficiency in internal controls related to segregation of duties.
GALC closed FY 2023 with a net change in fund balance of $1.1 million, a 7% increase from the prior year, bringing total fund balance to $16.6 million, up from $15.5 million in FY 2022. Total revenues increased by $167,000 to $1.6 million, driven by higher base rent and investment income, partially offset by reduced appropriations under the FY 2023 Budget Act. Expenditures decreased by $33,000 to $518,000 due to lower costs for fringe benefits, contractual services and supplies.
Despite the improved financial position, the audit from indepenedent auditors Ernst and Young LLP highlighted ongoing operational challenges tied to limited staffing and funding. The Landowner’s Recovery Fund remains unfunded, preventing implementation of intended programs, while amendments to the Survey, Infrastructure and Development Fund have not been utilized due to unclear legislative language. GALC also did not return any property during FY 2023, leaving the total acreage returned unchanged at 2,643.12 acres, and landowners have yet to be compensated under the Land Bank program.
The audit also detailed GALC’s lease management structure with the Guam Economic Development Authority, which retains a portion of lease revenues for management services. In FY 2023, GEDA withheld $149,000 in rent, and GALC recorded a $54,000 liability related to lease receivables. Auditors warned that limited segregation of duties in financial reporting increases the risk of undetected errors or misappropriation, recommending closer management review of bank reconciliations. More information is available through the Office of Public Accountability.