Auditor General Richard Quartey
A report by the Auditor-General on the financial operations of Ministries, Departments and Agencies (MDAs) for 2011 has revealed unhealthy cash management practices which resulted in the failure to pay revenue collected into the Consolidated Fund, tax irregularities and unauthorized payments, as well as non-availability of adequate records.
Such irregularities and indifference of MDAs overall cost the nation GH ?118,820,175.66, $246,744.24 and ?136,084.22 respectively, it mentioned.
Commenting on the development, Richard Quartey, the Auditor-General, noted that ?the cataloguing of financial irregularities in my report on MDAs and other agencies has become an annual ritual that seems to have no effect because affected MDAs are not seen to be taking any effective action to address the basic problems of lack of monitoring and supervision and non-adherence to legislation put n place to provide effective financial management of public resources.?
Whatever efforts have been made by MDAs in the past has not been effective enough to deal with the same issues of non-compliance and outright disregard for established order in the conduct of public financial business, he said.
?We noted also instances of inadequate controls over the administration of procurement, payroll and contracts,? the Auditor-General stated.
The breakdown showed that cash irregularities recorded for the period totaled GH ?33,972,751.25. This occurred through misappropriation of revenue/receipts, failure by accounting officers to properly acquit payment vouchers or produce them for inspection and validation and failure to recover funds from dishonoured cheques issued by businesses and individuals in settlement of their tax obligations.
Other sources included imprests not accounted for; unauthorized expenditure, non-availability of records on revenue collected and failure to present value books for inspection.
The incidence of cash irregularities was more pronounced in ministries such as the Justice and Attorney General (GH?16,375,045.05), Health (GH?12,089,459.63), Education (GH?2,621,482.63), MoFEP (GH?2,004,238.00), Employment and Social Welfare (GH?276,723.53), Youth & Sports (GH?237,864.70), Defence (GH?81,039.61 and other agencies (GH?84,758.12).
Various taxes due for payment to IRS/CEPS & VAT, all under the Ghana Revenue Authority (GRA), which remained uncollected during the period stood at GH ?52,807,322.72 and ?13,824.11 respectively.
?Most of the irregularities arose from poor supervision of schedule officers and failure to enforce tax laws and financial regulations as well as failure by management of MDAs to sanction offending staff.?
The Auditor-General said the irregularities relating to Stores and Procurement amounted to GH?780,027.67, adding that such activities related to purchases that were not taken on ledger charge, contract variations, payments for uncompleted works and fuel coupons that were not properly accounted for.
Furthermore, the report noted: ?Outstanding loans continue to be an issue because often loans are granted without specifying terms of recovery as responsible officials fail to monitor performance while beneficiaries also do not willfully ensure that the loans granted them are being recovered.
An amount of GH?3,442,296.60, out of the total, in respect of wrongful payment of vehicle insurance premium by Ministry of Health, ought to be recovered from the beneficiaries.?
Again, the report said payroll irregularities involved mostly unearned salaries paid to separated staff, as well as irregularities in pension payments and the failure to ensure timely deletion of the names of separated persons.
A total amount of GH?909,278.80 and $76,496.25 were recorded in the period under review.
?This is proving to be an area of significant loss of funds to Government and it is time to seek a more workable solution between MDAs and the Controller & Accountant General?s Department to delayed deletion of names of separated staff and pensioners.?
?Also management of some MDAs did not ensure deduction of rent that was due from the salaries of their staff. The amount involved was GH?191,077.17 and $20,058.50.?