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While ASTCA’s net worth dips, $1 million positive cash flow generated

ASTCA headquarters in Tafuna
TeleCommunications Authority’s FY 2019 independent financial audit

Pago Pago, AMERICAN SAMOA — At the end of fiscal year 2019, the American Samoa TeleCommunications Authority’s “total net position” decreased to $6.08 million compared to $8.56 million at the close of FY 2018, according to the government owned telecom FY 2019 independent financial audit by Oregon-based Aldrich CPAs + Advisors LLP.

“The change in net position of ASTCA is largely due to the adjustments made concerning the elimination” of the ASG Employees Retirement Fund (ASGERF) Lease Back agreement which was existent in 2018, according to the audit report, which also points out the net position at the beginning of FY 2019 totaled $13.84 million.

Furthermore during FY 2019, the government owned American Samoa Economic Development Authority (ASEDA) refinanced ASTCA’s lease back arrangement and thus the capital lease accounting entries were reversed as part of the accounting process.

Additionally, other improvements in the net positions are due to capital infrastructure works entered into during FY 2019, which largely includes technical projects, LTE wireless platform and billing system projects.

The report notes that total operating revenues for FY 2019 was just over $18.15 million compared to more than $18.74 million in FY 2018. “Overall operating revenues declined by 3%,” it says.  

 For operating expenses, it totaled $20.49 million (versus $23.86 million in FY 2018) - including $11.35 million in operations and maintenance expenses; $3.90 million for depreciation and amortization; and $642,000 in write-offs for uncollectible accounts receivable.

The “operating loss” decreased from $5.11 million in FY 2018 to more than $2.33 million in FY 2019, according to the report.

It also said that cash flow during the fiscal year resulted in a new increase in cash flow. In comparison to 2018, a net positive cash flow of $1 million was generated from operating activities, “demonstrating a positive improvement in the business operation.”

The auditors also stats that payments for capital activities were funded through additional funds received from ASG and refinancing of ASGERF loans as demonstrated by the increase in net-cash from financial activities.

It’s noted in the report, that during 2019, ASTCA received support from ASG and other related governmental agencies of approximately $25.3 million to fund capital investment projects and cover current obligations. Subsequently to year-end, ASTC received support of $1.5 million for payment of lease obligations.

“ASTCA is dependent upon the on-going support from ASG — in the form of debt financing to fund current and future projects,” it says.

(See Samoa News edition Aug. 27th for financial highlights, which include the Hawaiki submarine cable. Samoa News will report in a future edition on long-term debts for ASTCA).