The Auditor General says 27 Ministries Department and Agencies (MDA) and 218 Metropolitan Municipal District Assemblies (MMDA) have exceeded their approved budget by GHS10.5 billion for the year 2021.
The overrun expenses of the 245 public entities were made on goods and services, other expenditures, compensation of employees, capital expenditures, social benefits and subsidies.
This, according to the Auditor General, contravenes the Appropriation Act, 2021 (Act 1069) which sets budget limits within which MDAs and MMDAs are required to keep their expenditure to prevent overrun of their appropriation and the revised budget if any.
In its annual audit report on the Public Accounts of Ghana for the year ended December 31, 2021, the Auditor General indicated that MDAs exceeded their budget by GHS10.32 billion while MMDA exceeded by GHS191.8 million.
It has therefore advised the Controller and Accountant General (CAG) to regularly monitor the actual expenditure of covered entities against their approved budget to check potential overruns.
“The recurring budget overruns do not ensure effective and efficient budgetary control,” the report highlighted.
According to the report, the management of CAG in its response stated that the failure of all covered entities to be fully integrated and deploy the Ghana Integrated Financial Management Information System (GIFMIS) meant that the Department of CAG collates and validates financial data processed outside the GIFMIS.
It further noted that it does not strictly enforce ex-anti budgetary control for the direct formalisation of all expenditures processed outside the GIFMIS due to ensuring all actual expenditures reported by the individual covered entities are fully accounted for in the national account.
As such, expenditure processed outside the GIFMIS is directly journalised on the GIFMIS system for inclusion in the accounts, management explained.
“To the extent that, these expenditures did not have the original budget on the GIFMIS, the effect could be the overrun being reported by audit, where actual expenditure is captured on the GIFMIS ex-post via journal without the corresponding budget.
“Also, this could be attributed to the actual expenditure incurred by the covered entity from cash balances brought forward from previous period in respect of the funds i.e., IGF, Donor Funds and Statutory Funds without their original budget.” the report read.