Monrovia – Representatives of the National Investment Commission (NIC) appearing before the Public Account Committee (PAC) of the National Legislature Monday fumbled over questions relating to allegations of misappropriation of some US$686,985.47 in 2010/2011 and US$719,796.00 in 2011/2012 as contained in the General Auditing Commission Report (GAC).
The Committee chaired by Representative Thomas Fallah (District # 7 Montserrado County) called a public hearing to give officials of the NIC the opportunity to clarify allegations of financial misappropriations during the 2010-2013 fiscal years.
In a copy of the of the report submitted to FrontPage Africa, the GAC said the Chairman, Executive Director and Comptroller of NIC could not provide vouchers, general ledgers and financial statements to support expenditure amounting US$686,985.47 (2010/2011) and US$719,796.00 (2011/2012).
According to the GAC, the NIC’s failure to provide financial records to support the expenditure made during the fiscal years increased the risk of fraud, waste and abuse of public funds.
“It was the responsibility of the NIC management to preserve its assets and the records of its transactions by either backing up data or storing pertinent transaction records off sit to mitigate the risk of loss,” the report indicated.
The GAC also indicated that the NIC’s management exposed government’s assets to risk by its failure to take steps that could have prevented damage to government properties.
“The Management of NIC failed to secure government properties and transaction records entrusted to it, therefore the management should be held accountable,” the report stated.
The report further stated that the NIC maintained seven bank accounts with three banking institutions with no evidence that the finance department conducted monthly bank reconciliation on the accounts.
“Failure to prepare bank reconciliation could lead to untimely detection of errors, omissions or undetected loss and could result to the misstatement of the financial statements,” the GAC report said.
The management of NIC requested lease holders to deposit lease payments totaling US$129,550.00 directly to NIC MIP’s account at the Liberia Bank for Development & Investment (LBDI).
There was also no evidence that NIC sought approval from the Minister of Finance to deposit lease payment in the account at LBDI, the GAC noted.
The report showed that the management of the Investment Commission did not provide for US$73,850 of lease payments, made overtime payment of US$4,304.37 without justification.
The report further stated that the NIC failed to comply with the Public Procurement Concession Commission (PPCC) in the purchase of air tickets.
No evidence of approval of trip made by the Executive Director, incidental allowance payments not accounted for, absence of documentation such as boarding passes to validate the travel which were contrary to the Travel Ordinance and the PPCC Act, according to the GAC, could lead to irregular and over spending.
The report further discovered that NIC employees served as consultants while in the employ of NIC, which violates of the PPC Act.
The NIC management did not provide evidence of the payment of consultancies contract net of taxes payment of fees for services to existing NIC employees may lead to conflict of interest and undermines accountability and transparency.
An employee of NIC, Prince N. Karpeh, received payments amounting to US$4,580 on behalf of a consultant, Diasmer P. Bloe without authorization from the consultant that payment should have been made to Karpeh.
In addition to the litany of incompliances, the GAC report indicated that the NIC management did not follow the PPCC process in the procurement of fuel amounting to US$68,454.93 for the period 2012/2013.
Payments, according to the GAC, were made to vendors who were not registered dealers of fuel.
There was no evidence that Crosswords, Bashir Business Center and Cactus Motor were engaged in the supply of fuel as registered dealers.
The report also stated that there was no evidence that the NIC management developed strategic and operational plans. Management could not explain an objective basis on which resources were allocated for the achievement of the organization’s objectives, the GAC report claim.
The failure to produce strategic and operational plans could lead to NIC misdirecting its resources and not prioritizing resources to areas that may best achieve the entity’s objectives.
There was no evidence the NIC Management had put in place a disaster recovery plan to help recover transaction data and information to ensure business continuity.
“The failure to establish a disaster recovery plan may result in the complete loss of transaction data and information in the aftermath of disaster
“There was no evidence NIC had put in place a risk assessment process for identifying, analyzing and evaluating organizational risks.
Also, there was no evidence that the organization has a risk management policy to mitigate internal and external risks that could severally impact the achievement of the institution’s objectives.
“The absence of a risk assessment process could lead to NIC Management not being aware of potential risks that exist within its business operations.
There was no evidence that the IA is sufficiently independent.
The IA reports to the head of entity and not an audit committee, and its functions are not entirely separated from the entity.
“Failure to strengthen the institution’s internal audit function could limit the scope of the unit’s activities; increase the risk of management interference in the work of internal audit, thereby compromising the reliability and integrity of financial and operational information,” the report said.