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Auditor General finds 25 financial irregularities at Cape Coast varsity

…As total infractions hit GHC5.46bn at end of 2019

The Auditor General has discovered that 25 instances of financial irregularity took place at the University of Cape Coast and its various colleges and subsidiaries as at the end of 31st December, 2019. 

Corruption Watch’s tabulation of the amount of individual irregularities shows that the infractions involve a total of GHC88,289,417.16. In addition, the amount constitutes 49.09% of irregularities recorded for institutions under the ministry of education. 

According to the Auditor General, “…the Vice Chancellor, Professor Ghartey Ampiah entered into a 10 year Build, Own, Operate and Transfer Agreement with KLEOS UK Ltd for the provision of information and communication technology (ICT) services at a cost of $300,000.00 per year totalling $3,000,000.00 for the contract period without seeking approval from the University Council, the Minister of Education and Public Procurement before committing the University to such financial obligation.” 

The “contract signed by the Vice Chancellor was only witnessed by the Director of ICT services Dr. Regina Gyampoh-Vidogah. Consequently, the Auditor General recommended that “the Vice Chancellor should submit the Build, Own, Operate and Transfer Agreement (BOOT) with KLEOS UK Ltd to the University Council, Minister of Education and Public Procurement Authority for approval, failing which the sanctions in section 92 (1) of the Public Procurement Act shall be applied.”

These findings are contained in the 2019 Auditor General report on accounts of public boards, corporations and statutory institutions. 

The report also discloses that Mr. Kwame Fenyi, a Senior Administrative Assistant of the University’s Accra Office and Mr. Francis Arthur of UCC Enterprises did not account for total revenue of GH¢55,557.60 collected between June 2017 and April 2018. 

Consequently, “We recommended that the total amount of GH¢55,557.60 should be recovered from Mr Kwame Fenyi and Mr. Francis Arthur and paid to the University’s account for our verification.”

In keeping with the tenets of fairness, Corruption Watch made unsuccessful attempts to reach authorities of the University of Cape Coast to react to these findings. 

It must however be noted that the Auditor General, in putting together its report, afforded all institutions the opportunity to respond to the issues raised.

Overview

The 2019 Auditor General report on accounts of public boards, corporations and statutory institutions shows that financial accountability in public institutions is declining after brief gains in 2018. According to this Auditor General report, the amount of irregularities discovered in the 2019 audit was 81.8% above the 2018 figures. 

The 1134-page report details the state of fiscal accountability, including structures and mechanisms as at 31st December, 2019. 

The Auditor General reports that the total irregularities stood at GH¢5,468,398,431 as at 31 December 2019. This figure is a dramatic GHC2,461,139,507 (or 81.8%) jump from the 2018 total irregularities figure of GH¢3,007,258,924.  The Auditor General explains that the surge of GH¢3,058,438,311,169 can mainly be attributed to outstanding debtors/loans/recoverable component of the total irregularities in 2019. Indeed, Outstanding Debtors/Loans Recoverable constitutes GHC4,859,727,984 (88.87) of total irregularities discovered in 2019. 

The Auditor General defines Outstanding Debts/Loans Recoverable as trade debtors, staff debtors and outstanding loans.

The other types of irregularities reported by the Auditor General are cash irregularities, payroll irregularities, procurement irregularities, tax irregularities, stores irregularities and contract irregularities. From the Auditor General’s report, these six other forms of irregularities amount to GHC608, 670,447, representing 11.13%. 

Nonetheless, the levels of payroll irregularities, procurement irregularities, tax irregularities, and stores irregularities shot up dramatically over 2018 figures. On the other hand, the level of cash irregularities declined sharply from 2018 levels whereas contract irregularities declined marginally from the 2018 level as shown in the table below.

The table above shows the Comparative Analysis of Irregularities from 2015-2019 (figures rounded to the nearest cedi). Source: Report of the Auditor General on the Public Accounts of Ghana – Public Boards, Corporations and Other Statutory Institutions for the year ended 31 December 2019.

The report also groups the irregularities under sector ministries, indicating the amounts involved. Some of these amounts are in dollar, euro and pound sterling denominations. The Auditor General, in arriving at the general totals converted other currencies into Cedis at the prevailing exchange rate of GHC5.68 to the US$1 as at 31 December2019; prevailing exchange rate of GHC6.37 to the €1 as at 31 December; and prevailing exchange rate of GHC7.46 to £1 as at 31 December 2019.

After converting the transactional foreign currencies indicated for the various specific ministries, Corruption Watch discovered that the following five ministries recorded the highest amount of irregularities.

Name of MinistryTotal amount of financial irregularity (GHC)Type of irregularity found
Ministry of Employment and Labour Relations4,570,175,080.00Outstanding Debtors/ Loans Recoverable; Cash irregularities; payroll irregularities; Procurement irregularities
Ministry of Energy473,570,814.00Outstanding Debtors/ Loans Recoverable; Cash irregularities; payroll irregularities; Tax irregularities; Stores irregularities
Ministry of Education179,849,227.52Outstanding Debtors/ Loans Recoverable; Cash irregularities; payroll irregularities; Procurement irregularities; Tax irregularities; Stores irregularities; Contract irregularities
Ministry of Trade and Industry111,704,863.78Outstanding Debtors/ Loans Recoverable; Cash irregularities; payroll irregularities; Procurement irregularities; Tax irregularities
Ministry of Works & Housing60,751,544.00Outstanding Debtors/ Loans Recoverable; payroll irregularities; Procurement irregularities; 
Top five sector ministries according to amount of financial irregularity. Compiled by Corruption Watch.

Ministry of Education beats all 

A notable development is that the Ministry of Education ticks the box for every single financial irregularity classified by the Auditor General. 

The public boards, corporations and statutory institutions under the Ministry of Education were found to have engaged in all the categories of financial irregularities classified by the Auditor General. The total amount for these irregularities is GHC179,849,227.52, representing 3.29% of the overall irregularities. 

The 2019 Auditor General report on accounts of public boards, corporations and statutory institutions indicts education sector institutions such as the University of Cape Coast, National Board for Professional and Technician Examinations (NABPTEX), National Accreditation Board, National Council for Tertiary Education, University of Professional Studies Accra (UPSA), Ghana Institute of Journalism and Kwame Nkrumah University of Science and Technology.

Spotlight on UCC 

Other findings of the Auditor General against the University of Cape Coast and its subsidiaries include a discovery that the College of Distance Education granted advances amounting to GH¢21,298,853.44 without any agreement whatsoever to four (4) contractors for the execution of various projects but recovered only GH¢6,345,578.70, leaving a difference of GH¢14,953,274.74 unrecovered as at 31/12/18. The advances were granted since 2013 and 2016 financial years from Internally Generated Fund of the University. 

As a result, “We recommended that Management should recover the total outstanding advance of GH¢14,953,274.74 from the affected contractors with interest using Bank of Ghana interest rate, failing which the total amount of GH¢14,953,274.74 should be recovered from the officers who authorised the payment,” the report indicated. 

Moreover, the Auditor General found that “the University paid an amount of GH¢113,116.56 to Top Express Freight Handling Ltd to clear 3600 MIFIs and 8000 U Sim Chip from KLM Airlines for Bolte Communication Limited a private company. We however noted that after the clearance, Bolte Communication Limited took delivery of the goods from the University Stores on 20/8/18 preventing the University access to the MIFIs and the U Sim Chips for use. We recommended that the total amount of GH¢113,116.56 should be recovered from Bolte Communication Limited with interest, failing which the total amount of GH¢113,116.56 should be recovered from the Vice Chancellor, Professor Ghartey Ampiah with interest.”

In addition, the Auditor General states that “Contrary to Regulation 39(2)(c) & (d) of the Financial Administration Regulations 2004 (L.I. 1802) our vouching disclosed that the University made a part payment of GH¢451,530.00 to KLEOS Technology for information and communication services without justification. We recommended that KLEOS Technology, the Council and the University Director of ICT services Dr. Regina Gyampoh-Vidogah should provide evidence that 20,000 students and officers of the University did use the KLEOS services, the basis of the invoice and payment of GH¢451,530.00 to KLEOS Technology, failing which all payments to KLEOS Technology should stop and the amount of GH¢451,530.00 ($100,000.00) recovered from KLEOS Technology, the Council, and the Director of ICT services Dr. Regina Gyampoh-Vidogah,” the report stated.

There is more. The Auditor General further says that “Contrary to Section 16.1 of the Conditions of Service for Senior Members of Public Universities of Ghana, 2011, we noted that the University granted study leave with pay amounting to GH¢1,868,638.72 to eight (8) staff members but the officers did not return to serve the University as required. We recommended that Management should pursue the affected officers and their guarantors to refund the total amount of GH¢1,868,638.72 to the University.”

Report by Frederick Asiamah, Journalist, Corruption Watch

Email: f.asiamah@cw-ghana.org

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