Ghana has lost an amount of GH?75 million in bank charges from poor treasury managemnet, the Auditor-General?s 2011 report on the country?s public accounts released August 14, 2012 has revealed.

According to the report, the Treasury Main Account had been overdrawn by GH?527,234,555 as at the end of the year 2011, whereas the Collections Accounts had a credit balance of GH?806,285,449.

?During the period under review, I observed that the Treasury Main Account had been overdrawn by GH?527,234,555 as at the end of the year, whereas the Collections Accounts had credit balance of GH?806,285,449,? Auditor General Richard Q. Quartey wrote in the report sent to the Speaker of Parliament Rt. Hon. Mrs Justice Bamford Addo.

The report stated that the Controller and Accountant?s General Department (CAGD) has a responsibility of ensuring that by means of an advice to the Bank of Ghana (BoG), balances from the subsidiary accounts, such as the Collections and Rationalisation Accounts, are promptly transferred into the Treasury Main bank accounts to maintain those Accounts at zero balance.

But the Auditor General said failure by the ?CAGD to transfer the credit balances from both the Collections and the Rationalisation Accounts into the Treasury Main Account resulted in the payment of interest charges totalling GH?75 million on the amount overdrawn from the Treasury Main Account.?

Effective treasury management requires the maximization of Government of Ghana?s (GoG) liquidity position through the avoidance of unnecessary borrowing and interest costs to the Consolidated Fund, it noted.

In response to the loss, the Controller and Accountant?s General (CAG) stated that ?as part of the implementation of the Treasury Single Account, an electronic facility has been made available on real time basis for both CAGD and BoG that would determine the overdrawn position on which interest would be charged.

The CAG continues ?The facility provides one with the opportunity of viewing a consolidated cash position of all GoG bank accounts with BoG.

However, arrangements for the use of the result of the consolidated cash position between the Finance Ministry and BoG is in progress, the CAG indicated.

?When finalised, interest would be charged on the overall net position as against interest on the overdrawn position on the Treasury Main Account,? the audit report quoted the CAG.

To reduce interest charges on the Treasury Main Account, the Auditor General urged the CAGD to ensure the timely electronic clearing of cash balances from its portfolio of subsidiary accounts so that idle funds are fully utilised before borrowing from BoG.

Mr Quartey recommended that the CAGD should request the BoG to clarify the basis on which the total interest charges of GH?75 million against the Treasury Main Account was determined.

By Ekow Quandzie

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