Africa-Press – Liberia. — Entity Failed to Remit over US$18K to GOL account, GAC’s findings Reveals
Audit Reports Uncover financial Irregularities at Liberia Land Authority A recent audit conducted by the General Auditing Commission (GAC) revealed discrepancies in the financial operations of the Liberia Land Authority (LLA).
A compliance audit of the financial operations of the LLA conducted by the GAC has revealed that the LLA failed to remit to government revenue, despite selling and leasing property belonging to the state.
The report highlighted that the LLA failed to remit government revenue despite generating significant income from property sales and leases.
The compliance audit covered the period from June 30, 2020, to August 31, 2023, and was done in alignment with the Auditor General’s mandate outlined in Section 2.1.3 of the GAC Act of 2014 and other applicable regulations.
For the fiscal year 2020/2021, the LLA reported a total revenue of US$179,299 from various sources, including administrator deeds, warranty deeds, land disputes, and lease agreements.
However, the audit found that the LLA management did not remit the government’s share of cash collections on accrued revenue, amounting to US$18,701.
The breakdown of the revenue sources and amount collected include: Administrator deed US$73,756; Warranty deed US$56,240; Land dispute US$14,150; Investigation US$,888, Mortgage deed US$8,565, Court deed saleUS$ 2,070 and lease agreements US$3,725.
Others include: court decree of lease US$1,670; Survey permit US$2,360; Search US$1,525 Curator deed US$980,
Certified deed US$550 and Public land sale deed US$310; Quit claim US$210; Executor US$240; Sheriff’s deed US$50; and Aboriginal deed US$10, totaling the US$179,299.
The audit revealed that LLA management did not remit central government’s share of cash collections on accrued revenue totaling US$18, 701 and L$280,450 could not be traced to reconcile entry’s bank statements.
Additionally, discrepancies were noted in bank reconciliations and tax remittances.
The report also pointed out several unauthorized payments made by the management to third parties, lack of evidence of a proper procurement process, and absence of financial statements submitted to relevant government offices.
“Management did not prepare bank reconciliations reports for all of its accounts resulting in variances of US$1,715,56 and L$235,977.73 between the entry’s Central Bank of Liberia (CBL), and its cash book records respectively” ,the report revealed.
The report also established that the Management made several payments totaling US$4,983 to third parties instead of the vendors, suppliers or their named legal representation.
“Management did not withhold and remit taxes on goods and services procured totaling US$11,027 and they procured goods and services totaling US$41,098.62 and L$685,659.20 without evidence of an approved procurement plan,” the report revealed.
According to the report, there was no evidence of a procurement process conducted nor was there minutes and attendance records evidence that a functional procurement committee exists.
The report also established that Management made several payments totaling US$4,983 in the name of employees of LLA rather than the vendors, services providers, direct beneficiaries or their legally authorized representatives.
“Management did not adopt an operational financial administrative manual, strategies and operational plans, human resources manual, fixed assets management policy and petty cash.,” the report highlights.
The report also revealed that, “Management did not prepare quarterly and annual financial statements for onward submission to the Offices of the Auditor General and Comptroller and Accountant General.
“Management did not maintain detailed accounting journals and ledgers,” the report added.
In its response to the audit, management stated the process of reconciling its financial transactions were ongoing when the LLA’s Comptroller was changed. Hence the management has subscribed to the EcoBank system to view and verify all payment from bank statements before an official receipt is issued.
“We observed that the above amounts were not traceable to our bank statement during which communication was sent to the bank responsible (Global Bank) requesting a joint reconciliation,” the management said. “Management has drafted a financial manual that was in the process of being validated for use by the entity. As of now, the financial manual has been finalized and approved by the LLA board of Commissioners and is being used to govern the effective and efficient financial operations of the entity.”
This, they observe, was due to the inattentiveness of the financial division headed by the former Comptroller to prepare financial statements..
“We have taken note of your observation concerning non preparation of monthly bank reports and will do as required by the public financial management act,” the management said
Management’s response highlighted efforts to address the issues raised, such as drafting a financial manual and implementing improved financial oversight measures.
Meanwhile, the GAC made a series of recommendations to the LLA including the immediate deposit of unremitted government revenue into the consolidated account, withholding and remitting goods and services taxes, establishing a functional procurement committee, and ensuring proper documentation and approval of monthly bank reconciliations.
Moving forward the GAC recommends that management should account for the unremitted Government of Liberia (GoL) share of revenue amounting to US$4,035,147.58. Additionally, management must immediately facilitate the deposit of this unremitted amount into the consolidated account..
It further recommends that management should provide substantive justification for not withholding and remitting goods and services taxes (GTS) going forward management should withhold GST on all revenue. And ensure the procurement committee is made functional.
“The LLA management should provide an explanation with supporting documents for the variances,” the GAC noted. “Management should ensure that monthly bank reconciliation for all its bank accounts during the fiscal period are appropriately prepared, reviewed and approved by staff with the requisite qualifications and competence.
“Monthly bank Reconciliation report should be adequately documented and filed to facilitate future review,” the GAC’s recommendations noted.
These recommendations, the GAC noted, aim to address the identified financial irregularities and improve financial accountability at the LLA.
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