Monrovia — The Ministry of Finance and Development Planning (MFDP) made domestic debt payments totaling US$139,413,238.54 during the fiscal years 2017 to 2021 without the necessary supporting documentation, including payment vouchers and other relevant documents to authenticate the transactions, according to a report by the General Auditing Commission (GAC).
The GAC stated, "During the audit, the Auditor General observed that Management made payments against several claims recorded in the CAG domestic debt payment schedule (presented by Management) amounting to US$139,413,238.54 for the fiscal years 2017/2018 to 2020/2021 and the special budget year (July 1 to Dec. 31, 2021) without the necessary supporting documentation such as payment vouchers and other relevant documents to authenticate the transactions."
The compliance audit of Liberia's domestic debts through the MFDP covered the period from January 1, 1980, to December 31, 2021.
Most of these years were marked by significant turmoil in Liberia. From 1980 to 1985, the country was governed by a military junta led by the late Samuel Kanyon Doe, who seized power in a coup d'état on April 12, 1980. From 1986 to 1990, Doe served as a civilian president, although he was accused of ruling with an iron fist. The years that followed were characterized by back-to-back civil wars, which lasted from 1990 to 2003.
According to the GAC, there were no payment records available from 1980 to 2016/2017 for the periods under audit.
In its breakdown of payments, the GAC revealed that the MFDP paid US$472,264.58 during fiscal year 2017/2018, US$1,734,493.23 in 2018/2019, and US$28,599,461.24 in 2019/2020.
Speaking at a hearing conducted by the Joint Public Accounts & Expenditure Committee of the Legislature on Monday, Dehpue Y. Zuo, Deputy Minister for Economic Management at the MFDP, disclosed that Liberia's total debt currently stands at US$2.6 billion, of which US$1 billion is domestic debt.
During the hearing, the GAC, represented by Deputy Auditor General Wesley Nanka and his team, reported that the total payments for domestic debt did not reconcile with the total payments recorded in the domestic debt database (CS-DRMS/DASHBOARD), leading to an unreconciled variance of US$33,905,121.34.
Additionally, the GAC noted that actual domestic debt payments exceeded budgeted allocations by US$33,359,948 for some of the years under audit. The GAC further stated that it could not perform a reconciliation between budgeted and actual domestic debt payments for the periods from 1980 to 2006/2007 due to the lack of relevant documents for those periods.
Unreconciled Payment Schedule with Debt Service Bank Statement
The GAC also observed a variance of US$50,963,652.97 and L$5,191,147,397.85 between the CAG domestic debt payment schedule/Vendor Analysis Detail Report (presented by Management) and the bank statements received for the fiscal period 2020/2021 and the special budget year (July 1 to December 31, 2021). Moreover, bank statements for previous periods were not made available during the audit, preventing the GAC from reconciling bank statements with payments recorded in the debt ledger for previous periods.
Further, the GAC obtained several domestic debt payment vouchers amounting to US$29,239,139.21 and L$200,200,000.00 for the fiscal years 2018/2019 to 2020/2021, which were subsequently provided by Management but could not be traced to the CAG domestic debt payment schedule (Vendor Analysis Detail Report). The GAC noted that it could not validate the existence of these payments due to the non-provision of bank statements for the periods of the payments.
"Our review of the GOL Debt Service Account provided by the MFDP as the domestic debt payment account revealed that the bank statements contain a number of significant transactions relating to other payments, including payroll and foreign debt payments, amounting to US$53,863,852.47 and L$1,515,837,480.37," the GAC added.
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The GAC also reported that no evidence of payment records from 1980 to 2016/2017 was found for the periods under audit.
Regulatory Compliance
Regulation P.9 (2) of the Public Financial Management (PFM) Act of 2009, as amended and restated in 2019, states: "Payments, except for statutory transfers and debt service, shall be supported by invoices, bills, and other documents in addition to the payment vouchers."
Additionally, Regulation P.12 of the PFM Act of 2009, as amended and restated in 2019, stipulates: "Where the officer signing the payment voucher cannot himself check that the services, goods, or works for which payment is being made have been received, he shall ensure that the voucher is supported by original copies of supporting documents such as contracts, local purchase orders, goods received notes, and a certificate or other endorsement such as an annotated rubber stamp signed by an officer who can attest to the correctness of the fact."
