By ANDRE BAGOO Saturday, May 10 2008

GOVERNMENT will continue to support the activities of the State-owned Taurus Services Limited, even though it has raked up a net loss of $183 million for the year 2007 and has had its viability as a going concern questioned by an independent auditor’s report.

According to a Pricewaterhouse Coopers report, dated March 27, 2008, and laid in Parliament yesterday, the company incurred a net loss of $183 million for the year as well as a loss of $195 million in 2006. Additionally, as of September 30, 2007, the company’s liabilities exceeded its total assets by $1.6 billion.

“These conditions indicate the existence of a material uncertainty which may cast significant doubt about the company’s ability to continue as a going concern,” the Pricewaterhouse report concluded.

The latest figures show an apparent loss-making trend for the beleaguered debt collection company which was formed for the acquisition and recovery of some of the assets of the Workers’ Bank (1989) Limited — now a part of First Citizen’s Bank, as well as other assets subsequently acquired through collections, sales of security and other means.

In 1999, the company, based on Duncan Street, Port-of-Spain, incured a loss of $118 million. In 1998, the loss was $80 million. By 2004, the company was yet to repay $32 million it owed to the Agricultural Development Bank from a $61 million promissory note.

According to the report, the company has had to absorb $566 million in public sector loans which were transferred to it by the Government.

The company is also owed $174 million stemming from a loan it advanced to the Ministry of Finance “for partial financing of the purchase of shares in the rights issue by BWIA.” This loan was made repayable by December 2005.

In piloting the Finance (Supplementary Appropriation) Act 2007 in Parliament on January 18, Karen Nunez-Tesheira, the Minister of Finance, outlined the need to not have state companies drain public funds.

“In the case of BWIA, the Government was faced with an intractable problem of having to support an inefficient, overstaffed and unprofitable airline. It was...incumbent on the Government to stop the hemorrhage of state resources.”

“The Government has always acted responsibly and has also demonstrated a capacity to confront and deal with state companies that have presented a drain on scarce state resources,” she noted.

“Inflationary factors have impacted on costs and there were unavoidable increases in rent due to relocation, guard services, central and other operating expenses and account related costs (such as) attorney fees,” the March 26 Taurus Directors’ report notes.