SOEs to suffer severe sanctions for untimely financial reporting – VEEP

financial reporting

State-Owned Enterprises which fail to meet the required deadline stated in the law when presenting their financial reporting will receive severe sanctions, Vice President Dr. Mahamudu Bawumia has stated.

According to Dr. Bawumia, the state of reporting has significantly improved from what it was before to now; hence, the various entities cannot continue untimely presentation of their financial reports – stating that the use of digital technology should make reporting much easier and seamless going forward.

“We had entities which had not presented audited accounts over a long period. There are still several non-complying entities when it comes to financial reporting. I would like to also state that relative to timely financial reporting, the honeymoon is long over and severe sanctions will follow from now onward for those who fail to meet required deadlines as specified in the law,” he noted.

Dr. Bawumia raised this concern in his address at the Public Enterprises League Table (PELT) awards through a recorded video.

Commenting on losses that are made by some of the state agencies, Dr. Bawumia said it is not right that entities which have been entrusted with key state assets declare losses so tax revenue meant for critical services is diverted to support them.

Talking about steps taken by the Public Enterprise Ministry, the Vice President said he has been informed by the Minister of Public Enterprises that a State Ownership Policy (SOP), Performance Management Framework (PMF) and a Code of Corporate Governance (CCG) for specified entities have been developed in conjunction with the Ministry of Finance, Public Services Commission and State Interest and Governance Authority (SIGA) for Cabinet’s consideration.

With the performance agreements signed between entities and SIGA, Dr. Bawumia indicated that he expects to see a vibrant and profitable specified entities sector in the country going forward.

“It is the intention of government that some state-owned enterprises be listed on the Ghana Stock Exchange. This is to give Ghanaians the opportunity to participate in their activities.

“It will also open the companies up to greater transparency and the tenets of good corporate governance. Besides the above, the listing will make available to the companies additional capital for investment and growth without resorting to government for capital injections,” he said.

The PELT Awards

The Public Enterprises League Table (PELT), according to the minister responsible for Public Enterprises, Joseph Cudjoe, is a tool to engender competition and will rank the performance of entities in respect of their attaining targets set and agreed in the annual performance contract they sign with SIGA.

It is designed to be a technical ranking system on several dimensions – ranging from financials, efficiency and productivity, management improvement and innovation. He mentioned that it is envisaged to promote innovation in management of the public enterprises. It is expected to trigger a derived motivation on the part of boards and CEOs to want to do better solving problems of the public enterprises’ high indebtedness, loss-making, inefficiencies, low innovation, lack of research and development.

The maiden edition of the PELT awards was organised under the theme ‘Improving Sector Business Outcomes’, and honoured about twelve state-owned enterprises that put out outstanding performances which met the criteria laid down.

Mr. Cudjoe urged the SOEs to allow PELT to keep reminding them about issues of profitability, payment of dividends, timely reporting, efficiency in service delivery and many others which remain challenges for the sector to solve.

Award Winners

Most Innovative SOE – Volta River Authority

Most Innovative Regulator – Gaming Commission of Ghana

Most Compliant SOE – Ghana National Petroleum

Most Compliant Regulator – Environmental Protection Agency

Most Financially Sustainable Regulator – Foods and Drugs Authority

Most Efficient Regulator – Water Resources Commission

Best Inter-Trading Specified Entity – Food and Drugs Authority

Most Digital Specified Entity – Driver and Vehicle Licencing Authority

State Company of the Year – TDC Development Company Limited

Regulator of the Year – Driver and Vehicle Licencing Authority

Overall Specified Entity of the Year 2020 – TDC Development Company Limited

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