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24.06.2013 Business & Finance

Bank of Ghana cited for several infractions in the 2011 Auditor General's report

By myjoyonline
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The Auditor General has noted with concern, a number of violations by the Bank of Ghana in the pursuit of its mandate for the year ended December 2010. These are contained in the latest Auditor General's Report for the year ended December 2011.

The Auditor General indicts the Central Bank of unduly allowing government's borrowings to exceed by almost 2 times, the limit imposed by the Bank of Ghana Act. This includes mainly loans and long term government securities and promissory notes which totaled almost 2.2 billion Ghana cedis. With the limit of about 826 million Ghana cedis, a difference of almost 1.4 billion cedis was recorded.

The Central bank is also blamed for allowing government to withdraw in excess of 83 million Ghana cedis from the Controller and Accountant General's Special Accounts at the bank for receiving HIPC funds and withdrawing for development projects.

The Bank of Ghana is also cited for granting short term loans and overdrafts to government without charging the interest due - leading to an outstanding amount of almost 460 million Ghana cedis in the year under review.

The Auditor General is also accusing the Central bank of granting loans without valid contracts - citing in particular, a US$50 million facility it granted GCB without renewing the agreement when it expired. According to the report, the Memorandum of Understanding was to expire in six weeks from 1st February, 2009 but as at 31st December, 2010, an outstanding balance of the cedi equivalent of the US$ 50 million remained unsettled. The report added that no new agreement was established with GCB to extend the terms of the agreement which expired on March 31, 2010.

The Auditor General in general made recommendations for the Bank of Ghana to comply with the specific provisions in the law regarding the respective transactions.

Story by Ghana / Joy Business / Emmanuel Agyei

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