President Nana Addo Dankwa Akufo-Addo has extended the audit period of KMPG into the revenue assurance contract between the Strategic Mobilisation Ghana Limited (SML) and the Ghana Revenue Authority (GRA).
The international audit firm was initially scheduled to present their findings in two weeks; however, a new date has been established by the Jubilee House.
In a press statement dated January 24, 2024, the Director of Communications at the Jubilee House, Eugene Arhin, said the period had been extended to February 24.
“The President of the Republic, Nana Addo Dankwa Akufo-Addo, has extended the period within which KPMG is to complete its audit on the transaction between the Ghana Revenue Authority (GRA) and Strategic Mobilisation Ghana Ltd (SML), from the initial date of Tuesday, 16th January 2024, to a new date of Friday, 23rd February 2024.”
It said the extension follows a request by the firm.
“This follows a request made by KPMG to the President requesting for an extension of the two-week period originally given the company to undertake the assignment.
KPMG is to submit its final report no later than Friday, 23rd February 2024.”
As part of the terms of reference, KPMG must conduct an audit to ascertain the rationale or needs assessment performed before the contract approval by GRA and assess how the arrangement aligns with specific needs.
Additionally, assess the appropriateness of the contracting methodology, verifying compliance with legal standards and industry best practices in the procurement process for the selection of SML.
KPMG must also evaluate the degree of alignment between current activities and the stipulated contract scope, identifying any deviations.
Furthermore, evaluate the value or benefit that SML has so far offered to the GRA through this engagement.
The audit firm must review the financial arrangements, including pricing structures, payment terms, and resolution of any financial compliance issues.
Finally, it must submit a comprehensive report on your findings on the above, together with appropriate recommendations.
The GRA has awarded three contracts to SML since 2019 to detect invoice fraud, fight under-declaration of fuel volumes and, by extension, taxes collected by the fuel marketers from consumers on behalf of the government and then an expansion to minerals exported by Ghana.
The contacts are reported to have been awarded through sole sourcing.
According to Media Foundation for West Africa (MFWA) who first brought this to the attention of the public, investigations revealed SML is not tackling any of the problems and malfeasance that was identified in causing leakages in the sector.
It also established that SML by the contract will be paid US$100 million by the government of Ghana for the “revenue assurance” it provides.
The GRA in a statement in December 2023 denied SML was being paid for no work done.
“The work of SML over the period has led to a significant increase in the figures reported in the downstream petroleum sector, from an average of 350 million litres per month in 2018 and 2019, to 450 million litres per month from 2020/2021.
“This represents over a thirty- three per cent (33%) increase in volume reporting and an average of an extra 100 million litres per month at a levy rate of GHS1.44p. The extra revenue variance gained for the two (2) years will exceed GHS3 billion. This performance is attributable mainly to the introduction of ICUMS and SML systems.”