The 2021 Auditor General’s Report has revealed that the Board of the Bulk Oil Storage and Transport Company (BOST) had no policy guidelines on how its financial resources should be invested.

However, it did an investment with some financial institutions leading to the lock-up of funds to the tune of ¢19.66 million.

The report, therefore, recommended that the Board should develop a policy document to guide future investment decisions of the company.

“We noted after a review of the Board’s policy documents that, the Board has no policy guidelines on how BOST’s financial resources should be invested but did an investment with some financial institutions leading to lock up of funds to the tune of ¢19.665 million We recommended that the Board should develop a policy document to guide future investment decisions of the company”.

“We noted that three companies, Unity Enginmac Co. Precious Engineering and Dass-B Electricals bided for the award of contract for the installation of LED bulbs and streetlights for BOST of which Enginmac Co. was recommended by the evaluation team for the award of the contract to the tune of GH¢178,252. We noted further that, Unity Enginmac Co. Ltd and the two other alternative tenderers namely Precious Engineering and Dass-B Electricals who participated in the procurement were all owned by one person. We recommended that the contractor be invited to explain the ownership of the companies and tender documents submitted and admonish the evaluation team to do proper due diligence in the selection process as this lapse was identified in the previous year’s audit and cautioned”, it added.

BOST continues to pay avoidable judgment debts

The report also further identified that BOST continues to pay avoidable judgment debts in the forms of cost and interest amounting to ¢9.1 million and a little above $3 million to three contractors for breach of contract and undue delays in the payment of legitimate contract sums.

The report, therefore, recommended that management apply appropriate sanctions on all officers whose negligence have occasioned the loss.

"Additionally, we urged Management to heed to all contract terms and indulge in negotiations rather than lawsuit in resolving disagreements".

Contrary to Public Financial Management Act, the Auditor General’s report also noted that, BOST did not obtain VAT invoices and receipts for payments totaling a little above ¢726 thousand cedis made to suppliers and service providers for the period under review.

“Contrary to Public Financial Management Act/Regulations, we noted that, BOST did not obtain VAT invoices/receipts for payments totaling ¢726,376.33 with a VAT component of ¢127,115.86 made to suppliers and service providers for the period under review. We requested management to obtain the requisite VAT invoices/receipts covering the payments totalling GH¢726,376.33 by 31 March, 2022 failing which the VAT component of GH¢127,115.86 should be recovered from the authorising and approving officials and paid same to the Commissioner General, Ghana Revenue Authority and submit the evidence for verification.”

The report also noted that the management of BOST after awarding six different contracts to contractors undertook various forms of additional works or variation, which were avoidable and relatively excessive with respect to the cost or value.

Analysis of these variations ranges from 20.23% to 93.17% increment based on the total initial contract sum of ¢33.542 million with a total change order or variation and additional cost of ¢29.981 million and increased the overall contract sum to ¢63.523 million.

The report concluded that out of the six contracts varied, two were awaiting approval from the appropriate approving authority. to the works department to augment their efforts and bring about efficiency and value for money in the award of contracts or to employ the service of QS as may deem fit.