The Audit Service has exposed weak oversight control in financial borrowing at the University of Ghana (UG).
According to the service, the nation’s premier learning institution was saddled with a total amount of GH? 259,912,377.69 in loans and bonds as at the end of 2017.
The Service made the revelation in its report on special audit it carried out on selected state institutions in 2018.
According to the report dated March 31, 2019, “the University does not have a borrowing strategy, which would outline roles and responsibilities in the arrangements of borrowing, determination of borrowing needs, clear mechanism of servicing loans, and provision of timely report on utilization of the facility to the FGPC.”
It added that the anticipation of budget deficits to warrant financial borrowing were not shown in the annual budgets of the University of Ghana and that there was no evidence of how UG mitigates the effect of borrowing denominated in foreign currency.
Untimely Payment of Utility Bills
The report indicates that UG was indebted to the tune of GH? 96,282, 723.19 for the consumption of electricity and water as at the end of 2017.
It said utility payments was skewed towards GoG releases under Goods and Service vote, even though a higher provision for the payment of utilities was provided under the Internally Generated Funds (IGF) than GoG subventions for Goods and Service over the period of the audit.
Avoidable Judgment Debt
The report signed by the Auditor-General, Daniel Yaw Domelevo, further indicates that the University refused to meet a rightful request for supplementary payments of ex-gratia benefits of GH? 1,512,191.13 of the staff who retired in 2010 and 2011.
This eventually led to an award of Judgment Debt of GH? 4,534,255.56 by the Accra High Court.
GH? 100 Bank Accounts
“UG operates multiple bank accounts with a number of them remaining dormant and with less than GH? 100.00 as the bank balance,” it said.
“We urged Management to reduce the number of multiple bank accounts and adopt a centralization approach to improve efficiency in the management of bank accounts as well as ensure that disbursement process are met in a timely manner,” according to the report prepared under Section 16 of the Audit Service Act, 2000 for presentation Section 20 of the Act.
No Record On Spending
The report also reveals absence of transaction records to support expenditure at the University of Ghana, disclosing that the University advanced an amount of GH? 74,070.70 to a Project Manager, Dr. Thomas N.N. Nortey on 10/042017 for the construction of a poultry research house.
However, it said, there were no documents on such procurement records, award of contract, and bills of quantities to substantiate the constructional works.
According to the report, the UG “does not have underlying assets to generate investment income to continue the payment of ex-gratia on retirement of employees as stipulated in the various staff conditions.”
It said “again, the total amount of ex-gratia payments is not part of the compensation employees’ budget submitted to GoG (Government of Ghana) under the current subvention arrangement.
The Service, the report said, therefore recommended that management of UG should develop funding strategies with the aim of fully funding the ex-gratia payments by creating an asset base to generate investment income instead of the current “pay as you go” model.
It indicated that “management agreed with the finding and stated that the University will make budgetary allocation of a minimum of one million Ghana Cedis into an investment account from next academic year to build a fund for the payment of ex-gratia.”
BY Melvin TarlueRead Full Story