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Report of the Auditor-General on the Accounts Of Our Vision To be one of the leading Supreme Audit Institutions in the world, delivering professional, excellent, and cost effective auditing 2016 services DISTRICT ASSEMBLIES REPUBLIC OF GHANA REPORT OF THE AUDITOR-GENERAL ON THE ACCOUNTS OF DISTRICT ASSEMBLIES FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2016 This report has been prepared under Section 11 of the Audit Service Act, 2000 for presentation to Parliament in accordance with Section 20 of the Act. Daniel Yaw Domelevo Auditor-General Ghana Audit Service 14 August 2017 This report can be found on the Ghana Audit Service website: www.ghaudit.org For further information about the Ghana Audit Service, please contact: The Director, Communication Unit Ghana Audit Service Headquarters Post Office Box MB 96, Accra. Tel: 0302 664928/29/20 Fax: 0302 662493/675496 E-mail: [email protected] Location: Ministries Block 'O' © Ghana Audit Service 2017 TRANSMITTAL LETTER Ref. No. AG./01/109/Vol.2/106 Office of the Auditor-General P. o Box M96 Accra Tel. No. (0302)662493 Fax: (0302)67775496 14 August 2017 Dear Rt. Honourable Speaker, REPORT OF THE AUDITOR-GENERAL ON THE ACCOUTNS OF DISTRICT ASSEMBLIES FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2016 I have the honour, in accordance with Article 187(5) of the Constitution to present my Report on the audit of the accounts of District Assemblies for the financial year ended 31 December 2016, to be laid before Parliament. 2. The Report is a consolidation of the significant findings and recommendations made during routine audits conducted under my direction, which have been formally conveyed in management letters and annual audit reports to the Assemblies. The findings herein contained are the unresolved significant issues after taking into consideration verified management responses. It is presented in three parts. Part I outlines our mandate, scope and objectives for the audit, while Part II provides an executive summary of the results of the audit and our recommendations. Part III deals with the details of the significant findings and recommendations. Report of the Auditor-General on the Accounts of Dist. Assemblies for the financial year ended 31 December 2016 i 3. The Report continues to highlight recurring irregularities which are caused by absence of sanctions against financial and administrative indiscipline, managerial ineffectiveness and low level of commitment by Coordinating Directors and Finance Officers towards enforcing the provisions of relevant legislation and administrative instructions. 4. I have begun putting in place the needed administrative structures to enforce my mandate to disallow and surcharge officials found to have engaged in irregularities or caused the loss of funds. I hope this would complement the efforts of the Head of Local Government Service and the Ministry of Local Government to deter the recurrence of the offences. 5. I gratefully acknowledge the cooperation and assistance provided by the Chief Executives of the Assemblies and their staff during the audits. I also acknowledge and commend my staff for their invaluable contributions towards the production of this report. Yours faithfully, DANIEL YAW DOMELEVO AUDTOR-GENRAL THE RT. HON. SPEAKER OFFICE OF PARLIAMENT PARLIAMENT HOUSE ACCRA Report of the Auditor-General on the Accounts of Dist. Assemblies for the financial year ended 31 December 2016 ii TABLE OF CONTENTS Paragraph Page(s) PART I Mandate, Scope and Audit Objectives 1-5 1-2 PART II Summary of Findings and Recommendations 6-26 3-10 PART III Details of Findings and Recommendations Ashanti Region 27-74 11-23 Brong Ahafo Region 75-125 23-37 Central Region 126-145 37-44 Eastern Region 146-176 44-55 Greater Accra Region 177-206 55-63 Northern Region 207-227 63-69 Upper East Region 228-249 69-76 Upper West Region 250-270 76-82 Volta Region 271-299 82-90 Western Region 300-330 90-100 Appendices: Submission of Annual Financial Statements A DDF and UDG Disbursements by MLGRD B Income Performance (2014-2016) C IGF Performance (2014-2016) D Operational Results E Assets and Liabilities (2014-2016) F Financial Irregularities G Report of the Auditor-General on the Accounts of Dist. Assemblies for the financial year ended 31 December 2016 iii ACRONYMS AFD - French Development Agency CIDA - Canadian International Development Agency DACF - District Assemblies Common Fund DCD - District Coordinating Director DDF - District Development Facility DANIDA - Danish Agency for International Development DP - Development Partner FAR _ Financial Administration Regulations FMDA - Financial Memoranda for District Assemblies GCR - General Counterfoil Receipt IGF - Internally Generated Funds LI - Legislative Instrument LGCSP - Local Government Capacity Support Programme GoG - Government of Ghana IGF - Internally Generated Funds MLGRD - Ministry of Local Government and Rural Development MMA - Metropolitan and Municipal Assemblies MMDA - Metropolitan, Municipal and District Assemblies RCC - Regional Coordinating Councils UDG - Urban Development Grant Report of the Auditor-General on the Accounts of Dist. Assemblies for the financial year ended 31 December 2016 iv REPORT OF THE AUDITOR-GENERAL ON THE ACCOUTNS OF DISTRICT ASSEMBLIES FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2016 PART I MANDATE, SCOPE AND AUDIT OBJECTIVES Introduction In accordance with Articles 187(2) and 253 of the Constitution as well as Section 121 of the Local Government Act, (Act 462), the Audit Service has audited the accounts of the 216 Metropolitan, Municipal and District Assemblies for the financial year ended 31 December 2016. Thirty-nine (39) Assemblies were unable to submit their financial statements by the statutory deadline of 28 February 2017. We however conducted audits on their accounting records and operations of all the 216 Assemblies. 2. Our findings and recommendations from the audits of the Assemblies were discussed with the key personnel involved and communicated in individual management letters and annual audit reports for their comments and necessary action. Responses received, where deemed appropriate, have been included in this Report. Scope and audit objectives 3. The audits were guided by Section 13 of the Audit Service Act, 2000 (Act584) and the auditing standards of the International Organisation of Supreme Audit Institutions (INTOSAI). Section 13 of Act 584 requires me to examine, as I deem necessary, the public and other government accounts including District Assemblies and to ascertain whether in my opinion: The accounts have been properly kept; Report of the Auditor-General on the Accounts of Dist. Assemblies for the financial year ended 31 December 2016 1 All public monies collected have been fully accounted for and the applicable rules, regulations and procedures are sufficient to provide effective check on the assessment, collection and proper allocation or revenue; Monies have been spent for the purposes for which they were appropriated and expenditures made as authorized; Essential records are maintained and the applicable rules and procedures are sufficient to safeguard and control the Assemblies’ assets; and Programmes and activities of the Assemblies have been undertaken with due regard to economy, efficiency and effectiveness in relation the the resources utilised and results achieved. 4. The audits also ascertained the extent of compliance, among others, with the Public Financial Management Act, 2016 (Act 921), Financial Administration Regulations of 2004, the Financial Memoranda for District Assemblies, 2004, Public Procurement Act and other relevant regulations, 5. We have provided in this Report, extracts from the financial statements for the period 2014 to 2016 for purposes of comparing the year-on-year performance of the Assemblies and to provide an appraisal of Assemblies which consistently default in submitting their financial statements for audit validation and were therefore excluded in the previous reports. The extracts include income, expenditure, operational results, assets and liabilities of the Assemblies. Report of the Auditor-General on the Accounts of Dist. Assemblies for the financial year ended 31 December 2016 2 PART II EXECUTIVE SUMMARY Submission of annual accounts 6. One hundred and seventy-eight Assemblies submitted their 2016 financial statements for audit validation by 28 February 2017 as required by Section 80(1) of the Public Financial Management (PFM) Act, 2016 (ACT 921). We could not validate the financial statements of Amenfi East Assembly as their accounting records were with the Economic and Organised Crime Office. 7. The financial statements of the remaining 177 presented fairly, the financial positions of the Assemblies as at 31 December 2016 and the results of their operations for that year. The performance of the Assemblies in preparation and submission of financial statements for audit validation over the 2014 to 2016 is presented below. Year Total No. of No. of Assemblies No. of % of defaulting Assemblies with audited defaulting Assemblies financial statements Assemblies 2014 216 192 24 11.1 2015 216 201 15 6.9 2016 216 177 39 18.1 8. All the 15 Assemblies in arrears as at 31 March 2016 submitted their 2015 financial statements before 31 December 2016 with the exception of Kwahu Affram Plains North which was in default for 2015 and 2016 financial years. The 39 defaulting Assemblies are indicated at Appendices A1 to 10. Sources of Income 9. The total income received by the 177 Assemblies in 2016 was GH¢1,276,293,415.80 from five main sources namely the District Assemblies Common
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