In Akan folklore, hypocrisy is profoundly expressed in the conduct of a bird called kokone kone which habitually goes upstream to muddy the stream only to quickly dash downstream to ask who caused the mess.
It beats my imagination how various levels of traditional and political authority pretend to be unaware of who the real culprits are in the wanton devastation that is being visited on our lands and other natural resources. Occasionally, some inconsequential operatives in the galamsey space are apprehended to give the false impression of a commitment to deal with the canker.
The real barons of the illegal gold mining, some sheltering safely under political umbrellas are left to carry on with their nefarious activities, often even protected by other organs of state, in the full glare of hapless but genuinely concerned citizens. Eventually, the rest of the populace collectively pay through high water bills forced through our noses because the Ghana Water Company Limited’s operational costs increase from the high levels of chemicals needed to purify the awfully polluted water for safe for human consumption. Not even the warning that we may soon import drinking water appeals to the conscience of those in authority.
Growing up in a rural area, no one needed to convince me of the power wielded by traditional authorities. The mere thought of being reported to a sub-chief or Odikro of the remotest hamlet was enough to send some chill into the spine of an errant citizen. The chill becomes even more severe when one was threatened with a summons before a higher authority along the traditional power echelon.
Yet, here we are with the custodians themselves who have sworn to uphold and defend the resources bequeathed to us all now denying any power to confront the menace amidst the possible complicity of some of them. They will rather remorselessly descend heavily on anyone who dares to even imagine their probable complicity in the havoc to the environment.
My Akim friends have long boasted of “Akyemkwaa a wonom Birim”, emphasizing their pride of belonging to a cherished tradition. Unfortunately, none in his right mind can now safely drink from the famous Birim River due to excessive contamination from illegal gold mining. Hypocrisy and corruption have enjoyed a happy marriage at our expense!
Sadly, the devastation has been man-made and did not start from yesterday. The blame game between the NPP and NDC does nothing to assuage my anger as I watch the milky – looking but utterly poisonous water body as I drive through Anyinam towards Kumasi. Rivers Pra and Offin have all become heavily polluted.
Demonstration against the ancestors?
Frantically looking for solutions to the scourge of illegal mining, a wild thought ran through my mind. How about organizing a demonstration against the ancestors for ignoring the desecration of the pristine environment they left for us? “Yen ara y’asase ni, indeed!”
Where have they been all this while when even sacred forests and river bodies, and now even cocoa farms have been ravaged in our inordinate search for quick monies? We have consistently poured libation with the choicest of schnapps, and other expensive drinks calling on them to help us in times of danger. As far as I recall, they have never rejected these first offerings nor questioned how we came by them.
Do they not have a reciprocal obligation to rise to smite all the people in high and low places for this charade of protecting what has been bequeathed to us? Or we should organize a demonstration against them, seeing that this appears the safest means to attract attention now?
Ghana Cocobod too?
Over the past few weeks, I came across the grim story of Ghana Cocobod engulfed in debt and liquidity crises and almost threw my arms in despair, seeing that the national treasure is under threat.
In the rural areas where I was raised, selling koko (porridge) is the preserve of women. In these environs there is a deep-seated perception that a woman who sells this highly patronized food product and makes a loss is incapable of any entrepreneurial endeavour. When she fails in that enterprise she should not thereafter be entrusted with capital for any other venture.
Extrapolating that perception to Ghana Cocobod which has the privilege of being the sole buyer of cocoa produce and the luxury of licensing other buyers places the institution in a comfortable position that they simply cannot operate at a loss.
To read that this firm is embroiled in a financial distress to the tune of a debt of over 10 billion cedis confounds one’s imagination. This is an institution that has been at the forefront of Ghana’s economy. It has long been pampered by the state, given a monopoly of purchasing cocoa; empowered to determine what percentage of international proceeds from cocoa exports to give hapless farmers.
In recent times, they have had the luxury of the state guaranteeing upfront syndicated loans for cocoa purchases. With such enabling environment without competition, Ghana Cocobod, has no business with illiquidity or financial crises of any magnitude just like my rural koko seller.
Other private firms have been operating under extremely unfavourable economic conditions and have largely survived. It therefore comes as a huge surprise that this over pampered child should be allowed to dissipate national resources in such wanton manner that poor cocoa farmers have to wait for so long to obtain payment for cocoa sold to the Produce Buying Company and other agents.
Certainly, the Auditor General owes us a duty to determine how this colossal debt was accumulated and how to retrieve from whichever wrong hands that caused this mess. We simply cannot countenance such blatant infractions of accountability at a time when the average cocoa farmer is earnestly hoping for an upward review of prices in the face of astronomical increase in the prices of various inputs for cocoa cultivation.
Cocoa cultivation is under serious threat of diminishing output if care is not taken. Among the key factors militating against the industry is the dearth of labour on cocoa farms as the youth increasing migrate away from the rural to urban areas in search of non-existent jobs.
The weather over the last five years has been equally inclement. Cocoa seedlings from nurseries transplanted over the period have been scorched consecutively during the extreme harmattan conditions, sometimes with as low as twenty percent survival rate, from this writer’s personal experience.
The current pricing regime is certainly unattractive to motivate farmers to expand their acreage, let alone maintaining existing ones. The yield per acre suffers from poor maintenance culture, exacerbated by expensive inputs beyond the reach of the average farmer. Out of exasperation, some farmers close to the border with Cote Di Ivoire are unapologetically threatening that they may smuggle their cocoa output to our neighbouring country.
The ageing population of the remaining farmers contribute to poor maintenance culture and sustainability. Compounding the gloomy outlook is the increasing cost of inputs amidst cacophonous assertions of subsidies which hardly reach the real farmers.
Perhaps of even greater concern is the rate at which large swathes of cocoa farms are being sold out recklessly to illegal gold miners while the state looks on with only hypocritical and puerile commitment to enforce rules on illegal mining. The reality is that the area under cocoa cultivation has been declining sharply over the years. This has been worsened by the onslaught of galamsey operations which have doubtlessly affected diminishing cocoa output since 2017.
While the outlook on the local cocoa industry looks gloomy, it might still be in the self interest of chocolate manufacturers to assist with incentives to prop the cocoa output, lest the hunter ends up suffering as much as the prey. Thankfully, the ravages caused by covid 19 on the global economic outlook appears to be receding. A rebound of global economic activity is expected to raise the fortunes of chocolate manufacturers. Perhaps a moral and economic obligation arise to support Ghana’s cocoa production.
Accounting gymnastics?
As an accounting student, I have always been fascinated about the computation of profits by organisations. Profit is inherently a summation of various facts and a large dose of opinions employed by the management of a company, aided by its internal and external auditors. All these units rely on generally accepted accounting standards prevalent at a time.
While cash is not necessarily profit, illiquidity can drive a firm into insolvency, hence the need to critically examine a firm which is supposedly making decent profits but still carry large debt or liquidity over hang.
Firms, and particularly banks in Ghana have been noted to be making mouth- watering profits only to be liquidated soon after. Scenarios such as this tend to confuse non accounting students and other stakeholders.
It is instructive to note that while cash flows are real (you must have the money to operate or die), profit is based on various assumptions, notably the going concern and accrual bases that smoothen visible early warning signs of corporate distress.
It was heart warming to find that the Bulk Oil Storage and Distribution Company made an after tax profit of GHs. 160.7 million in 2021 as compared to a loss of GHs.291 million in 2020. Even more interesting to note is the record that the firm reduced trade liabilities from USD. 624million to USD. 39 million.
For a state organization operating under The State Interest and Governance Authority, this performance appears laudable. It will be helpful for management students, particularly, to see the details of the Income Statement and especially the Balance Sheet to determine the strategy and business lines that contributed to this sterling performance, particularly how it managed to scale down trade liabilities from USD. 624 million to USD.39 million, without growth impairment.
The idea of sustainability in performance standards reflect this need to examine the ingredients in the sterling performance so that one does not wake up to witness any accounting gymnastics such as another key state bank that made colossal profits only to return a huge loss in less than three years without any significant changes in the general operating environment.
The writer is a Fellow of the Chartered Institute of Bankers, an adjunct Lecturer at the National Banking College, a farmer and the author of “Risk Management in Banking” textbook.
Email; [email protected] Tel. 0244 324181
