Irregularities at public boards cost the nation GH¢12.8

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The Auditor-General’s report for the year ending December 2021 on Public Boards has discovered the total irregularities recorded increased by 135%.

The percentage represents GH¢7,387,774,195 rise from GH¢5,468,334,006 in 2019 total irregularities figure to GH¢12,856,172,626 in 2020.

This was occasioned mainly by a surge of GH¢5,207,442,576 or 107% in outstanding debtors/loans/recoverable components of the total irregularities for the period ending 31 December 2020.

According to the report, the total irregularities figure of GH¢718,085,208 for 2016 increased to GH¢12,002,880,339 in 2017.

The irregularities declined by GH¢8,995,621,415 in 2018 to GH¢3,007,258,924.

However, the total irregularities increased by 81.8% from the 2018 figure of GH¢3,007,258,924 to GH¢5,468,398,431 in 2019.

”During the period ending 31 December 2020 the total irregularities recorded a 135% or GH¢7,387,774,195 rise from GH¢5,468,334,006 in 2019 total irregularities figure to GH¢12,856,172,626 in 2020. This was occasioned mainly by a surge of GH¢5,207,442,576 or 107% in outstanding debtors/loans/recoverable component of the total irregularities for the period ending 31 December 2020, the report said.

Outstanding Debts/ Loans Recoverable – GH¢10,067,170,560

The report said the irregularities represent trade debtors, staff debtors and outstanding loans. Included in this figure is an amount of GH¢5,487,969,144.11 due from customers for power supplies in

respect of Forex Power Sales, Local Power Sales, Mines Power Sales, Other Local Power Sales, Government MDA’s Power Sales, and other Power Related Recoverables as of 31 December 2019.

Also, the absence of effective debt collection policies, non-existence of credit controls to recover the debts and Management’s indifferent posture towards loan recovery contributed significantly to these anomalous conditions,” the report stated.

Aside from these irregularities, improper maintenance of records on debtors, the absence of debtors’ ageing analyses, non-documentation of agreements stipulating the terms and conditions of loans, failure to ensure that loans are repaid and Management’s non-compliance with rules and regulations accounted for these irregularities.

The report recommended that the Management of Public Boards, Corporations and other Statutory Institutions should strictly adhere to rules and regulations with regards to debts management. They should also put in place proper policies for the management of loans and other receivables as well as ensuring that loans and debts are repaid on due dates to avoid or minimise the occurrence of bad debts.

Tax Irregularities amounted to GH¢29,201,677, the report added.

The Tax irregularities related to failure to pay statutory tax deductions on due dates, and non-deduction of applicable taxes.

They are also related to transacting business with non-VAT registered persons or entities. Out of the total tax irregularities of GH¢29,201,677, an amount of GH¢12,449,542 is attributed to Architectural and Engineering Services Limited (AESL) for unremitted P.A.Y.E and VAT deducted. 16. I recommended that the Finance Officers should strictly adhere to the tax laws to ensure that all tax revenues are promptly collected and paid to the applicable revenue agencies.

On procurement irregularities, the report said it cost the nation GH¢846,134,269.

”These irregularities occurred as a result of Managements’ non-compliance with the provisions of the Public Procurement Act 2003, (Act 663). Out of the total irregularities, US$39,000,000.00 (GH¢224,647,800) represented award of contract without following due processes by Management of Bulk Oil Storage and Transportation Company Limited (BOST).”

The report recommended that the Managements of the various Institutions should undertake procurement transactions strictly in accordance with the provisions of the Public Procurement Act as amended.

For example, Ghana Post was unable to recover an amount of GH¢1,511,431.83 as outstanding debt owed to the Company for Bulk Mail and EMS services respectively. We urged Management to be proactive in the recovery of debt owed to the Company in order to boost its revenue and enhance its operations.

Below is the link to the full report:

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