Disallowed expenditure: Auditor-General recovers GH¢12.7bn

The Office of the Auditor-General has recovered GH¢12.7 billion out of GH¢38.9 billion disallowed expenditures flagged in audit reports between 2020 and 2023.  

This represents 32 per cent of the amount flagged by the Auditor-General to be disallowed and recovered for the period of the special audit exercise.

The Auditor-General’s Report indicated that the GH¢12.7 billion of the disallowed expenditure for the period was recovered from public boards (GH¢10.79 billion); ministries, departments and agencies (GH¢1.86 billion); technical universities (GH¢35 million); internally generated funds (GH¢13.8 million); pre-university institutions (GH¢9.09 million), and the District Assemblies Common Fund (GH¢7 million).

The Greater Accra Region recorded the highest amount of recoveries of GH¢12.46 billion, representing 98 per cent of all the recoveries, with the Bono East Region recording the least recoveries of 0.01 per cent.

In a special audit report as of December 31, 2024, submitted to Parliament, the Auditor-General, Johnson Akuamoah Asiedu, disclosed that the recoveries were made following recommendations in his office’s annual reports.

The report, titled: “Special Audit Report on the Recoveries made from Disallowed Expenditure in the Auditor-General’s Reports from 2020 to 2023 and Payroll Savings as at 31 December 2024”, was mandated under Section 16 of the Audit Service Act, 2000 (Act 584).

Payroll savings

The report also revealed an additional GH¢86.8 million in payroll savings from 2022 to 2024, while recoveries of unearned pay amounted to GH¢7.21 million, bringing the total payroll audit gains to GH¢94.07 million.

The transmission letter addressed to the Speaker of Parliament, Alban Kingsford Sumana Bagbin, categorised the recoveries by year, type of irregularity and region.

Part I provided a summary, Part II detailed the disallowed expenditure recoveries, while Part III covered payroll savings as of December 31, 2024.  

Collaboration for recovery

Mr Asiedu stated that his office was working with the Ministry of Finance and other stakeholders to ensure that recovered funds were promptly paid into the Auditor-General’s Recoveries Account.

“This will not only provide timely funds for the government but also ensure financial discipline in state institutions,” he stated.  

Appreciation for Parliament

The Auditor-General commended Parliament and its Public Accounts Committee (PAC) for their support, attributing the successful recoveries partly to the committee’s oversight work.  
“The work of the PAC significantly contributed to the recovery of these amounts,” he emphasised.  

The report reaffirmed the Auditor-General’s commitment to safeguarding public funds and ensuring accountability in government expenditure.

Breakdown of recoveries

For 2020, the Auditor-General’s Office recovered GH¢6.84 billion out of GH¢11.378 billion, leaving GH¢4.53 billion in pursuit, while in 2021, GH¢1.14 billion of disallowed expenditure was recovered from a total recoverable amount of GH¢5.15 billion, leaving GH¢4.014 billion yet to be recovered.

In 2022, out of a recoverable amount of GH¢16.98 billion, the Auditor-General’s Office recovered GH¢4.02 billion, with GH¢12.95 billion recoverable disallowances being pursued, while GH¢702.27 million has been recovered in 2023 out of the GH¢5.46 billion recoverable expenditure, leaving GH¢4.76 billion being pursued.

In total, the Office of the Auditor-General is going after GH¢26.27 billion disallowed expenditure that occurred within the period under review.

Irregularities

For recoveries based on indebtedness, loans and advances irregularities, the Auditor-General recovered GH¢9.94 billion for the period, representing 78.22 per cent of the recoveries.

GH¢1.24 billion (9.81 per cent) was based on cash irregularities, GH¢1.49 billion (11.78 per cent) was for tax irregularities; GH¢11.88 million (0.09 per cent) was based on rent irregularities; GH¢10.79 million (0.08 per cent) was for payroll irregularities, while GH¢1.96 million of the recoveries was based on assets, stores and procurement irregularities.

Context

In the context of the Auditor-General of Ghana's report, disallowance refers to the act of rejecting or refusing to approve certain expenditures that violate the law.

This typically involves unearned salaries or allowances paid to public officers or individuals. 

When the Auditor-General identifies such irregular expenditures, he can disallow them and recommend recovery of the amounts involved.

As a distinction from surcharge, disallowance involves recommending recovery of irregular expenditures without necessarily imposing penalties.