Auditor General Modou Ceesay has presented his audit report on the different accounts of the Gambia Government showing serious violation of financial rules.
The presentation was held before the Finance and Public Accounts Committee of the National Assembly. The purpose of the audit is to look into how the public funds were managed in the year 2020. The audit report was for the 2020 accounts of the Government.
“The financial statement of the Government of The Gambia did not present fairly the financial position of the Government of The Gambia as of 31st December 2020,” he said.
The Auditor General said there were receipts detached from the receipt books but the amounts collected could not be established. He added that he could not confirm whether those monies were accounted for.
“This suggests a deliberate attempt with an intention to defraud Government revenue,” he said.
The Auditor General said the Department of Geology did not have a cash book to record the GTRs they issue out and collections made for licenses, penalties and royalties for both sand mining operations and stone quarries in 2020.
“The transparency and accountability of funds becomes difficult to determine as there are no underlying financial records to track financial information,” he said.
He said he discovered that cancelled cheques totalling One Million, Nine Hundred and Twenty-One Thousand, Two Hundred and Fifteen Dalasi Fifty-Eight Butut were encashed (converted into money) in 2020.
“I noted that the Accountant General failed to quantify losses in public monies in the financial statement,” the Auditor General said.
The Auditor General said he discovered the difference of One Billion Two Hundred and Eighty-Five Million Four Hundred and Sixty-One Thousand, One Hundred and Four Dalasi, Twenty-Five Butut between the extended trial balance and the account receivable on the statement of financial position resulting in an overstatement of current assets.
“I also noted a difference of One Hundred and Thirty-Six Million, Five Hundred and Three Thousand One Hundred and Eighty-Three Dalasi, Thirty-Six Butut negative between the extended trial balance and two accounts on the statement of financial position being the accounts payable and statement of deposits resulting in an understatement of liabilities,” the auditor said.
The audit boss said he also uncovered a difference of Eighty-Eight Million One Hundred and Ninety-Seven Thousand Six Hundred and Ninety-One Dalasi Fifty-Eight Butut negative between the extended trial balance and cash and cash equivalent under the statement of financial position resulting in an understatement of current assets.
“I noted 3 account lines totalling Seventy-Eight Million, Four Hundred and Ninety-Eight Thousand Six Hundred and Fifty-One Dalasi, Sixty-Five Butut. Other taxes amounting to Fifty-Two Million, Five Hundred and Sixty-Eight Thousand, Eight Hundred and Ninety Dalasi, Eight Butut that were not mapped to any disclosure items in the extended trial balance resulting to an understatement of the financial statement,” he said.
The auditor said he discovered a difference between the general ledger balance and the cash book balance amounting to Ten Million and Eighty-Six Thousand Eight, Hundred and Seventy-Seven Dalasi, Sixty-One Butut resulting in an understatement of cash and cash equivalent balance which is not disclosed in the financial statement.
“I also noted a difference of Six Billion, Eight Hundred and Sixty-Seven Million, Sixty-Eight Thousand, Three Hundred and Forty Dalasi between the balance of cash disclosed in the statement of financial position and the balance as per the statement of cash receipts and payments,” he said.
He maintained that there was an inconsistency in the amount of revenue and expenditure disclosed in the statement of revenue and expenditure and the statement of detailed revenue and expenditure amounting to Two Billion, Seven Hundred and Two Million, Four Hundred and Seventy-Three Thousand Five Hundred and Ninety Dalasi Ninety-Nine Butut and Two Billion Two and Seventy-Five Million, Six Hundred and Thirty-Five Thousand, Three Hundred and Ten Dalasi Twenty-Eight Butut negative respectively.
“I noted transit account balance amounting to One Billion and Six Million, Four Hundred and Ninety-Three Thousand, Four Hundred and Eighty-Two Dalasi were not cleared as at year-end [2020] and as a result, the designated account in which final entry should be made are understated,” he said.
He said he realised that the foreign currency account balance was not translated using the Central Bank of The Gambia rates leading to an understatement of Four Hundred and Ninety-Thousand Dalasi, Three Hundred and Fifty-One Butut in the cash balance.
He further explained that he noted differences amounting to Three Million, Nine Hundred and Twenty-Three Thousand, Three Hundred and Sixty-Eight Dalasi Fifty Butut between amounts transferred to the bank and figures derived from revenue records resulting in unaccounted revenue.
He stated that he noted misclassifications totalling One Hundred and Eight Million, Four Hundred and Fifty-Two Thousand, Six Hundred and Fifty-Three Dalasi, Sixty-One Butut in respect of loan repayments – principal and interest.
The Auditor General said domestic revenue comprises tax and non-tax revenue amounting to Thirteen Billion, Six Hundred and Ninety-Three Million, Eight Hundred and Fifty-One Thousand and Three Hundred Dalasi. He explained that non-tax revenue was collected by 11 different ministries and departments while tax revenue was collected by the Gambia Revenue Authority (GRA), and monthly collection reports are sent to the Accountant General’s Department.
The auditor boss said he held discussions with officials at the Accountant General’s Department and GRA to understand the internal controls regarding revenue collection, reviewed the Public Finance Act and other relevant laws and regulations that govern revenue collections at various ministries, departments and agencies, reviewed the revenue receipts to confirmed the entries in the details and obtained the cash book, bank statement and deposit slips to establish whether revenue collected were appropriately and fully accounted for, reviewed the bank statements to confirm all revenues collected were remitted to the respective government bank accounts, performed reconciliation between GRA revenue reports against revenue returns sent to Accountant General’s Department.
He disclosed that the serial numbers of the GTRs and the IFMIS receipts were not indicated in the bank deposit slips at the time of depositing revenue collected by the Ministry of Justice and the Department of Geology.
“This casts doubt as to whether the revenue collected amounting to Seven Million, Two Hundred and Seventy-Nine Thousand One Hundred and Ninety-Four Dalasi for the Department of Geology and Forty-Three Thousand for the Ministry of Justice was lodged to the relevant bank account,” he said.
The Auditor General said he noted revenue amounting to Two Million, Nine Hundred and Ninety-One Thousand, Nine Hundred and Fifty-Seven Dalasi, Eighty-Five Butut at the Department of Geology and the Department of Fisheries that were made without adequate supporting documents.
“The absence of these documents cast doubt in the legitimacy of the license certificates issued and revenue collected thereafter,” he said.
The Auditor General noted that there was a failure to deposit revenue on time contrary to the provisions of the Financial Regulations.
“I noted revenue collected totalling Seven Million, One Hundred and Fifty-Two Thousand, Two Hundred and Eight Dalasi, Thirty-Seven Butut from various ministries and departments were not timely deposited to the bank,” he said.
He stated that it is indicative of the internal control weakness over revenue management, which could lead to fraud and other irregularities if not addressed.
The Auditor General said the Government of The Gambia has shares or equity participation in some of the development banks, which allows the Government to access loans and other membership privileges. He stated that the Ministry of Finance has attached a staff in each of those banks to monitor Government interest. He said the banks include the African Development Bank, Islamic Development Bank, ECOWAS Bank for Investment and Development and BSIC Group.
Auditor General Ceesay said there was inadequate disclosure of financial instruments.
“I noted that the Government of The Gambia has made several payments in 2016, 2017, 2018 and 2020 through shared acquisition, and equity participation at various development banks as a result of its membership. The financial statement only disclosed amounts paid towards Government Equity Participation in these banks [and] investment held by the Government during the current year as detailed. However, there were no further disclosures and explanations to enhance the understanding of other equity participation such as the type of investment, the number of shares subscribed, contributions made and received as well as arrears resulting in these subscriptions since inception to date leading to inadequate disclosures,” he said.
He said he requested explanations but none were provided. As a result, he stated that he could not confirm the classifications and completeness of the disclosures made in the financial statement.
The Auditor General said compliance auditing is the independent assessment of whether a given subject matter is in compliance with the applicable authorities identified as criteria.
He said the Accountant General failed to submit the financial statements to him in time as dictated in the laws.
He disclosed that some expenditures were made that were not approved by the Accountant General. He said section 151 subsection 3 of the Constitution states that no money shall be withdrawn from the Consolidated Fund or any other public fund of The Gambia unless it has been approved by the Auditor General or a member of the National Audit Office designated by him or her.
“I noted that the 2020 warrant for expenditure was approved by the Minister of Finance contrary to the dictates of the above section of the Constitution,” he said.
He said the Government failed to quantify and disclose losses of public monies. He referenced the Public Finance Act. He said there was a fire incident at the Ministry of Fisheries reported and there was an investigation, but the extent of the loss was not established and disclosed in the statement of losses of public monies.
He said the Gambia Government signed two loan agreements but did not present the minutes of the meetings for those loans for audit review. He stated that the loans were 8 Million Euros for the Gambia Renewable Energy Component signed on 24 December 2020 and phase 2 of the Rehabilitation and Development of the Banjul International Airport on 24 February 2020 for 12 Million Dollars.
He said there were unretired impress. He explained that the impress holder is obliged to explain how the impress was spent.
“I noted unretired impress totalling One Million, Nine Hundred and Ninety-Four Thousand, Nine Hundred and Fifty Dalasi from impress holders as they failed to present original receipts and in some instances, no receipts were produced to retire the expenses incurred,” he said.
He said some Government officials, contrary to the Public Finance Act and the GPPA Act, have been collecting invoices from suppliers before receiving the request for quotation.
“This is indicative that government officials have acted in violation of the Public Finance Act and the GPPA Act by entering into commitments or contracts and receiving invoices before receiving requests for quotation,” he said.
He said the GPPA Act mandates the procuring organisations to maintain procurement and preserve documentation of procurement proceedings. He explained that this is for both inspection and audit purposes.
“I noted that 20 payment vouchers and 32 payments on capital expenditure amounting to Twenty-Seven Million, Three Hundred and Sixty-Thousand, Three Hundred and Twenty-Four Dalasi, Ten Butut and One Billion, Five Hundred and Seventeen Million Three Hundred and Twenty-Nine Thousand, Eight Hundred and Eighty-Two Dalasi, Forty-Two Butut respectively were without the required supporting document,” he said.
He stressed that the Ministry of Finance did not give him the Borrowing Plan of the Government for the year even after requesting for it.
