In the 2022 Auditor-General’s report, shocking financial irregularities totaling GH¢15.1 billion have been exposed in the operations of public boards, corporations, and other statutory institutions. This represents a significant reduction of 13.86 per cent (equivalent to GH¢2.4 billion) from the previous year’s figure of GH¢17.48 billion.
The irregularities identified in last year’s report comprised over GH¢15 billion that could be recovered, accounting for 99.69 per cent of the total, and an administrative infraction of GH¢47.28 million, representing 0.31 per cent. The unrecoverable portion consisted of procurement and other irregularities.
The Auditor-General emphasized the necessity for strict implementation of its recommendations to ensure financial discipline in managing public resources. Notably, the irregularities encompassed areas such as outstanding debts, loans, recoverable amounts, cash, payroll, procurement, tax, stores, and contracts.
It’s important to note that these irregularities have been a recurring issue in public boards and corporations since 2018, with a staggering total of GH¢53.87 billion recorded from 2018 to 2022. The numbers peaked at GH¢17.5 billion in 2021 before declining to GH¢15.1 billion in 2022.
Although 113 institutions were audited last year, slightly more than the 101 institutions audited in 2021, most irregularity categories witnessed a decrease. The administrative irregularities primarily involved procurement infractions and other procedural lapses in public financial management but did not imply a loss of funds.
The recoverable amount consisted of debts owed by inter-governmental agencies, overdue receivables, locked-up investments, unpaid taxes, unretired impress and advances, and loans given to employees of various institutions. On the other hand, administrative irregularities encompassed issues arising from procurement, overdue payables, and penalties due to delayed payments to suppliers.
For example, Ghana National Gas Limited Company was owed $741.93 million by various customers, with $515.20 million from Bui Power Authority, $215.78 million from Ghana National Petroleum Corporation (GNPC), and GH¢1.40 million from Northern Electricity Distribution Company (NEDCo).
The report attributed the irregularities to the absence of effective debt collection policies, lack of credit controls to recover debts, and management’s indifferent approach to loan recovery. Improper maintenance of debtor records, absence of debtors’ ageing analyses, lack of documentation for loan terms and conditions, failure to ensure loan repayments, and management’s non-compliance with rules and regulations were cited as contributing factors.
To address the issue, the Auditor-General recommended strict adherence to rules and regulations regarding debts management, the implementation of proper policies for managing loans and other receivables, and ensuring timely repayments to minimize bad debts.
Cash irregularities, amounting to GH¢23.51 million, were related to misapplications of funds, unauthorized payments, and board allowances granted to Council Members without ministerial approval. Of this sum, GH¢14.47 million resulted from unrecovered staff advances paid to Ghana Water Company Limited employees, attributed to poor oversight and nonexistent controls. Finance officers’ failure to maintain and file records properly also played a role in the cash irregularities.
The revelations from the Auditor-General’s report raise concerns about financial management practices in public institutions, urging authorities to take corrective measures to prevent future irregularities and safeguard public funds
Source: citinewsroom
