The Bulk Oil Storage and Transportation Company Limited (BOST) in 2019 overrun its budget by GH¢30,442,551 due to unplanned activities.
The amount represented 33.11 per cent in excess of the GH¢91,939,573 budgeted for 11 expenditure heads during the year under review.
Budget for staff cost was exceeded by GH¢5.5 million; operational expenses, GH¢6.2 million; operations and maintenance, GH¢7.8 million; Marine Insurance, GH¢1,824; fuel, GH¢7.5 million; rent and rates, GH¢29,400 and honorarium, GH¢266,398.
The others were interview and expenses, GH¢94,998; Directors Allowance, GH¢61,962; Foreign Travelling and Transport, GH¢221,494 and security services, GH¢2.6 million.
This was contained in the Report of the Auditor General on the Public Accounts of Ghana – Public Boards, Corporations and Other Statutory Institutions submitted to Parliament on June 30 this year.
According to the report, lack of due diligence in the disbursement of funds by the company accounted for the irregularity.
It noted that the Management misapplied the GH¢30.5 million on unplanned activities, a situation which could lead to delay in completion of other important planned projects.
The report said the actions by the Management was in breach of Regulation 78 of the Public Financial Management Regulations, 2019 (L.I. 2378) which provides that, a principal spending officer of covered entity is personally responsible for ensuring in respect of each payment of that covered entity, that there is a sufficient unspent amount of an appropriation for making the payment.
Management, it said, was directed to justify the misapplication and further advised to desist from such act and operate within budget.
In response, the Management said, it sought approval from the Board through the Finance Committee with justifications for these excesses for their consideration and explained that the staff cost was resulted mainly from renegotiated Collective Bargaining Agreement (CBA) with the workers union.
The Management further blamed low budget estimates, change in management plans, inability to obtain prices used for the budget among others, as some of the reasons for the budget overrun.
Going forward, the company proposed to undertake half year review of budget to ensure that actual expenditure was within revised budget.
BY CLAUDE NYARKO ADAMS