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Presentation of the
Auditor-General’s Report on the Public
Accounts of Ghana (Consolidated
Fund) to the Annual MDBS Joint Review
Meeting
OVERVIEW
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Introduction
Mandate
Standards
Main Findings of 2009 audit of the CF
Way Forward
Challenges
Conclusion
INTRODUCTION
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Article 187(2) of the Constitution requires the AuditorGeneral to audit the whole of the public sector
including the local government administrations, the
courts, universities, public boards, corporations and all
other public institutions operating or funded with
public funds.
The Central Government accounts is made up of:
Public Accounts (Consolidated Fund)
 MDAs Accounts
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INTRODUCTION
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This presentation relates to the Consolidated Fund
or the Public Accounts for 2009.
The purpose of the presentation is to highlight the
main findings of the audit of the Public Accounts for
2009 within the context of the Public Financial
Management (PFM) framework.
MANDATE
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The mandate of the Auditor-General requires that
within six months after the end of the financial year
he should report on the public accounts of Ghana
to Parliament; and in that report draw attention to
any irregularities in the accounts audited, and to
any other matter which in his opinion ought to be
brought to the notice of Parliament.
The Auditor-General therefore provides assurance
to the citizens, and other investors in Government
that public monies collected or received from them
are fully accounted for and used judiciously towards
the attainment of stated goals and objectives.
MANDATE
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The submission of the Auditor-General’s Report on
the Public Accounts of Ghana to Parliament on the
due date prescribed by the Constitution constitutes
a trigger for the release of funds by the donors to
Government.
Sections 13 & 15 of the Audit Service Act, 2000
(Act 584) require, among other things, that the
Auditor-General should ensure that the public
accounts have been properly kept and to give an
audit opinion on the financial statements of the
Consolidated Fund.
STANDARDS
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The Act requires that INTOSAI Standards and
methodologies should be used in the conduct of the
audit.
These standards require among other things that the
audit is planned and performed so as to obtain all
the information and explanations which are
considered necessary in order to provide the
auditor with sufficient evidence to give reasonable
assurance that the financial statements are free
from material misstatements, whether caused by
fraud or other irregularity or error.
STANDARDS
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To enable this to be achieved the standards require
that the SAI should have the necessary resources
which should be determined independently of the
audited entity.
MAIN FINDINGS
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1.Revenue & Other Receipts for 2009
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Total receipts in the Public Accounts amounted to GH¢9.64
billion, an excess of GH¢78.9 million over previous year’s
actual. Included in this, is a budget support of GH¢688.6
million from the Multi Donor Budget Support Partners made
up of GH¢339.7 million loans and GH¢348.9 million grants.
The total receipt of GH¢9.64 billion exceeded the
budgeted amount of GH¢9.35 billion, a marginal increase
of GH¢288.9 million.
2.Total Expenditure for 2009
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Total expenditure for 2009 amounted to GH₵9.36
billion
and
expenditure
exceeded
by
the
GH₵3.97
previous
billion.
The
years
total
expenditure of GH₵9.36 billion exceeded the
budgeted amount of GH¢9.28 billion also by a
marginal amount of GH¢82.02 million. During
2009, total receipts therefore exceeded total
expenditure by GH₵285 million.
3. Un-reconciled Bank Balances
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As previously reported, we noted that major GoG
Accounts Cashbook balances including Social Impact
Mitigation Levy, Petroleum Levy, NHIL, MoFEP
Divestiture, Special Collections and Civil Servants
17.5% SSF Accounts, with a total figure of GH¢85.7
million was not reconciled with their related bank
statements during the year under review.
Considering the significant nature of the accounts
involved, we reiterated our previous recommendation
that a proper investigation be carried out to ascertain
the actual balances of the respective accounts.
4. Inconsistencies in the records between
CAGD and MDAs
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The financial statement of the Consolidated Fund were
characterised by over statements and under statements
resulting from poor record keeping and lack of
information flow among key agencies.
17 MDAs that were sampled for audit revealed
significant differences between the amount disclosed as
expenditure in the Public Accounts and the related
supporting documents at the MDAs.
To minimise the risk of errors and omissions, we
recommended strong collaboration between CAGD and
the MDAs to provide assurance on the accuracy of
accounting information relating to the Public Accounts.
5. Non-preparation of Financial Statements by
MDAs
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The FAA requires MDAs to prepare monthly and
annual financial statements and to submit them to
the Controller and Accountant General, Minister of
Finance and the Auditor-General. However, lack of
capacity on the part of the MDAs have prevented
them from complying with the law.
6. MDAs Non-certification of Salary
Payment Vouchers
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Out of 17 MDAs visited, the Heads of only two (2)
namely, the Public Services Commission and Ministry
of Education, examined and certified the accuracy
of their monthly salary vouchers administered on
their behalf by CAGD.
To strengthen controls and improve on the integrity
of payroll data, we recommended that CAG should
ensure that Heads of MDAs strictly adhere to
Regulation 304 of the FAR, 2004.
7. Inadequate accounting of Foreign
Missions’ Special Collections
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Transfers made by the Ghana Mission in London
(GML) into the Dollar Account, Euro Account and the
Pound Sterling Account totalling US$4.3 million,
€3.6 million and £958,608.75 respectively were
not supported with monthly returns.
We recommended that the CAG should enhance his
supervisory review procedures over the activities of
the Head of Treasury at the GML, and should
ensure that all Special Collections transfers are
supported with adequate returns.
8. Inadequate record keeping of GoG
Equity Investments
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Contrary to regulation 146(2) of the FAR, 2004
which requires disclosure of GoG investment in the
Public Accounts, we noted some material
inaccuracies
in the disclosure of some GoG
investments in the Public Accounts.
We recommended that CAG should improve upon
his record keeping on investment and strengthen his
collaboration with MoFEP to ensure that all financial
records and adjustments relating to GoG
investments are updated.
9. Delays in the transfer of Indirect
Tax and Non-Tax Revenue
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We noted long delays in the transfer of indirect Tax
and Non-Tax Revenue (NTR) lodgements from
various transit accounts into the Consolidated Fund.
We also noted that, no reconciliations were
performed by MDAs to agree their NTR records
with the relevant bank statements.
We recommended strong oversight by MoFEP in
ensuring that the banks submit regular statements to
the relevant MDAs. MoFEP should also ensure that
all MDAs reconcile returns with the relevant bank
statements before submission to MoFEP and CAGD.
10.Delays in the transfer of Indirect
Tax and Non-Tax Revenue cont’d
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We also recommended that MoFEP should compel
the banks to provide the necessary facilities as
stated in the agreement to ensure the effective
monitoring of NTR collections.
Additionally, we recommended that MoFEP should
enforce the penalty clause where it is established
that there have been delays in lodgements into the
Consolidated Fund.
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11.Poor Management of Public
Loans
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Management of Public loans continued to pose
problems to CAGD and MoFEP resulting in a
doubtful debt amounting to GH¢669.3 million.
CAG should seek the assistance of MoFEP to
reconcile the public loan balances with the
beneficiary institutions.
12.Non-payment of GoG Guaranteed
Loans
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Out of a total ECGD loan of £112.5 million
guaranteed by government between 1990 and
1996 for 21 private companies, only one company
had fully paid up leaving a balance of £86.9
million outstanding as at the end of December
2009
MoFEP should institute appropriate legal measures
to recover the outstanding loan from the companies
in default.
THE WAY FORWARD
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There should be coordination between Bank of
Ghana and the CAGD in maintaining bank accounts.
CAG should maintain cash books for all the bank
accounts and carry out periodic reconciliation and
use this as a basis to prepare the Consolidated
Fund financial statements.
MDAs should be strengthened to prepare their
accounts as required by law.
There should be rationalisation of bank accounts to
allow for easy reconciliation.
CHALLENGES
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Expenses of the Audit Service for the audit of the entire
Consolidated Fund and all other public funds (GET Fund,
Road Fund, District Assemblies, etc) listed under Article
187(2) of the Constitution are required by the Constitution
to be paid from only the Consolidated Fund. These
expenses are, by the Constitution, charged on the
Consolidated Fund and should not normally be reviewed
and reduced by the Executive before presentation to
Parliament. Budgetary reductions over the past years
have not permitted the Office of the Auditor-General to
obtain sufficient funds to adequately cover its
constitutional mandate.
CHALLENGES
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Lack of appropriate and timely action on the
Auditor-General’s findings and recommendations
endorsed by Parliament poses a serious challenge
to the office.
CONCLUSION
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The Office of the Auditor-General has been
formally informed that a number of steps have
been taken to address the weaknesses identified in
the 2009 report.
These would be followed up and reported on
appropriately. It is most likely that the effect of
these measures would be reflected in the 2011
financial statement.
CONCLUSION
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We are going to work with Parliament and the
Executive to address the constraints of the Service.
As a SAI we shall continue to work closely with all
relevant Governmental agencies in order to
improve financial management systems in the public
sector.
ACKNOWLEDGEMENT
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We thank the MoFEP and CAGD for their continued
cooperation in the discharge of our Constitutional
mandate.
We also thank the DPs, Parliament and Civil society
for their continuous support for the ideals of good
governance.
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THANK YOU FOR YOUR
ATTENTION
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Access audit web site for the full details of the
report.