Report on Virgin Islands Corporation, Fiscal Year 1962
B-114822: Published: May 17, 1963. Publicly Released: May 17, 1963.
- Full Report:
The General Accounting Office has made an audit of the Virgin Islands Corporation for the fiscal year ended June 30, 1962, pursuant to the Government Corporation Control Act (31 U.S.C. 841). Our audit included a review of applicable legislation, a review of management controls, reviews of selected activities, and an examination of financial statements. Our examination of the financial statements was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and other such auditing procedures as we considered necessary in view of the internal controls afforded by the accounting system. The audit was conducted at St. Croix and St. Thomas, Virgin Islands.
The Virgin Islands Corporation is a wholly owned Government Corporation, created by the Virgin Islands Corporation Act of June 30, 1949 (48 U.S.C. 1407), as successor to the Virgin Islands Company incorporated in 1934. The Corporation's principal office is located on the island of St. Croix in the Virgin Islands of the United States. The Corporation is chartered through June 30, 1969, unless sooner dissolved by act of the Congress. Pursuant to the act, the President of the United States designated the Secretary of the Interior as his representative to exercise general direction over the corporation. The growing of sugar cane, the manufacturing of raw sugar, and the generation and distribution of electric power continued to be the Corporation's major revenue-producing activities during the fiscal year 1962. In addition, the Corporation commenced deliveries of potable water to the Government of the Virgin Islands from salt water distillation facilities designed to produce 275,000 gallons a day. The corporation manages certain Navy-owned properties on the island of St. Thomas and was also engaged in non-revenue producing activities designed to promote, through economic development, the general welfare of the inhabitants of the Virgin Islands. The management of the Corporation is vested in a 7-member Board of Directors. Activities of the Corporation provided employment for about 1,200 employees during the peak season. These employees included about 600 British West Indian workers mostly engaged for cutting cane during the harvesting season. The number of appointed personnel at June 30, 1962, was 180, compared with 155 at June 30, 1961. During fiscal year 1962, the Corporation sustained a net loss of $446,000 from revenue-producing activities, compared with a net loss of $145,000 incurred in the previous fiscal year. The higher net loss for fiscal year 1962 is attributable to the Corporation's sugar operations which resulted in a loss of $434,000 in fiscal year 1962, compared with a loss of $47,000 in the preceding fiscal year. Net income of $24,000 was realized in fiscal year 1962 from the Corporation's power operations, compared with a net loss of $91,000 for fiscal year 1961. During fiscal year 1962, the Corporation placed higher power rates into effect and improved its power-billing procedures. The Corporation's power costs for fiscal year 1962 include extraordinary charges of $125,000 to replace the crankshaft of a diesel generating unit and $155,000 for interest charges on the Federal investment in power facilities.