This was recommended in the committee’s consolidated report on the performance audit report of Gamtel on service delivery and GCAA on budget management by the National Audit Office (NAO) laid by the chairperson of PEC, Hon. Lamin J. Sanneh,
Laying the report, Hon. Sanneh stated the auditors observed that GCAA’s budget revealed inconsistencies in the way they provide explanations for changes in budget lines.
“GCAA’s budgets for the years 2020 and 2021 tried to provide explanations for changes in overall totals. The budgets for 2019 and 2022 lacked detailed insights into why budget allocations significantly changed.”
“The absence of explanatory notes identifying and explaining significant changes in specific cost items makes it difficult to understand the reasons behind budget changes,” the report observed.
“Without proper explanations, informed decision-making becomes difficult, and transparency in budget management is compromised. The board’s failure to understand the underlying needs for financing activities may result in budget adjustment requests that affect funding activity implementation.”
The audit report revealed that GCAA has a good system in aligning work plans to strategy in most areas. “However, the strategic objectives relating to finances are largely ignored in the work plans. This could be responsible for ineffectiveness in cost controls within GCAA as no cost target measures were set.
“The institution has not effectively executed its budgets. Management was not focusing on understanding the specific factors contributing to budget deviations and therefore, not taking corrective actions. GCAA has actively involved its departments in the budgeting process. The lack of rigorous reviews of estimates developed by these departments may have contributed to unrealistic budgets. Overall budgets do not have sufficient clarity regarding significant changes in budget allocations. This hinders effective budget oversight. Without proper explanations, decision makers (e.g. the board) may simply change budgets without adequate information.”
The PEC chair added that while the assumptions underlying the budget preparations did not raise any significant concerns, there were notable shortcomings related to cost estimates.
“Estimates were internally developed by user departments. According to the Auditors, these estimates were developed after communication with suppliers of goods and services.
“The departments submit the budget proposals to the Budget Committee for evaluation. Budget proposals lack supporting documentation, such as quotations, invoices, or other reliable evidence, which should serve as basis for their approval.
“The absence of such detailed information in the budgeting process poses risk of incorrect budgets that cannot be controlled. Budgets developed without reliance on accurate and valid estimates tend to become outdated and lose relevance over time. This situation may explain the significant variances experienced by GCAA for the period under review.”
