MDAs, MMDAs not complying with regulations — Report

Page 17, June 29, 2009
Story: Emmanuel Adu-Gyamerah & Daniel Nkrumah

THE Finance Committee of Parliament has noted in a report that Ministries Departments and Agencies (MDAs) and Municipal, Metropolitan and District Assemblies (MMDAs) were not complying with statutory regulations and government directives in the preparation of audit reports.
In its report on the Internal Audit Agency for 2006, the committee said the non-compliance was found mainly in the non-maintenance and update of asset register, non-preparations of bank reconciliation statements, inadequate controls over value books and unauthorised use of internally generated funds.
The committee also noted that 42 institutions, covering 58 per cent, had no Audit Report Implementation Committees (ARICs) in place with mandate to consider and implement audit reports.
“The Agency, therefore, needs further collaboration with the Auditor-General’s office to facilitate the process and to ensure that MDAs and MMDAs set up their Audit Implementation Committees,” the report said.
According to the report, the committee observed that out of the 121 internal audit report received, only 25 met the quality standards of the Agency’s expectation in terms of form and content.
It added that the remaining 96 fell short in terms of improper development of audit findings, non-inclusion of management responses and poor follow-up of previous audit recommendations.
The committee also noted in the report that out of a total budgeted expenditure of 13,103,508,948.00 cedis approved by Parliament, 12,457,823,047.00 cedis was released to the Agency and the actual expenditure amounted to 11,309,035,551.00 cedis resulting in a variance of 1,148,787,496.00 cedis.
“The variance of 1,148,787,496.00 cedis was used to support the work plan for the year 2007,” the report added.
The committee also noted that the Agency had been moving from one rented office to another and recommended that the Agency should be provided with the needed funding to put up an office accommodation.
The report also made reference to the “vast difference” between the total revenue for the year under review, which was 12,457,823,048.00 cedis and total expenditure including depreciation of 8,357,911,244.00 resulting in excess of revenue over expenditure of 4,099,911,804.00 cedis.
It added that it was explained by the Director-General that the excess of revenue over expenditure for the year was due to the annual accrual concept used by the Agency to prepare its accounts.