MONROVIA – The General Audit Commission (GAC) has uncovered major financial irregularities in the operations of the Liberia Water and Sewer Corporation. The report covers fiscal years from July 1, 2018 to June 30, 2021.
The audit report was submitted to the National Legislative Assembly on December 30, 2021. The report noted significant non-compliance with stated laws and regulations, policies and procedures, including irregularities in financial statements, failure to execution of bank reconciliation, generated invoices not collected, debit balances, disparity of daily receipts and bank deposits, irregularities in fixed assets, among others.
GAC observed that LWSC management did not take responsibility for its financial statements by signing or approving the statements in accordance with the Public Financial Management Act 2009 as restated in 2019. Accounts reported in the entity’s trial balance were unrelated to the account balances reported in the unsigned financial statements.
The GAC report noted that the LWSC maintains 22 (twenty-two) bank accounts but has been performing bank reconciliations for six months, thus leaving most of its accounts unreconciled.
According to the report, the GAC sought confirmation from several of LWSC’s major commercial clients regarding the accounts receivable balances reported by management, but the commercial clients did not confirm balances amounting to USD 872,917.44.
Daily cash receipts from the sale of water and sewerage services reported according to the LWSC daily cash receipts records prepared by the entity’s cashiers at its central office have not been reconciled to the figures reported by deposits banking. In most cases, the GAC report noted that the amounts deposited in LWSC’s bank accounts were less than the amount collected according to the cashier’s records.
Daily cash receipts from the sale of water and sewerage services generated at LWSC local offices in Buchanan, Grand Bassa County and Kakata, Magibi County were not substantiated by deposit slips and payment receipts, according to the report. According to the report, there was no documentation indicating that the reported amounts of US$17,503.56 and Liberian $915,710 collected by the Kakata substation had been deposited in a local bank account.
The GAC observed during the audit that of the twenty-four vehicles disposed of by LWSC management, seven (7) vehicles were disposed of without evidence of prior General Service Agency approval. Management asserts in its response to the GAC that the 7 vehicles were divested by the Deputy General Manager for Administration and that the proceeds were not reported to management.
In addition, the report states that a total of 125 (one hundred and twenty-five) fixed assets, including vehicles, motorcycles, desktop computers, laptops, generators and televisions, could not be checked during the physical inspection of the assets.
The report further stated that LWSC management had made payments for several items within the National Tender Threshold without evidence of tender documents, evaluation reports, contracts and delivery notes for goods and services provided in violation of Liberia’s public procurement laws.
The GAC further stated that employee social security contributions in the amount of US$372,015.49 were not paid to the Nation Social Security and Welfare Corporation. NASSCORP. According to the GAC, employees risk not receiving their pension benefits upon retirement if their benefits remain unpaid.
The report states that key policy documents such as Fixed Assets Management Policy, Human Resources Management Policy Administrative and Financial Manuals developed to govern the financial and technical operations of LWSC were not approved by the Board administration.
The report concluded that due to the importance of the issue addressed in the report, LWSC’s revenue generation, expenditures and internal control system are not in compliance with applicable laws and regulations of Liberia and policies. of the LWSC.
The President of the Republic of Liberia, George Manneh Weah, has requested the General Audit Commission to conduct an audit of the Liberia Water and Sewer Corporation (LWSC) on June 10, 2021.