Audit Report reveals over GHS456k UG investment locked up in defunct investment company

    35

    The 2020 Auditor-General’s report has revealed that the University of Ghana had invested an amount of GHS456,199.08 in now-defunct fund management company, Liberty Asset.

    According to the report, the University’s College of Health Sciences and School of Medicine and Dentistry invested the money without following the University’s financial Regulations and Governance.

    A news report filed by Accra-based Citi News indicates that the College of Health invested GHS377,003 while the School of Medicine and Dentistry invested GHS79,196.08. The license of the fund management company was revoked in 2019 by the Securities and Exchange Commission. However, the two investments were made in 2016.

    “There was no evidence of due diligence report available to continue investment with Liberty Asset in terms of its risk profile”

    “We noted that the College Administration and School of Medicine and Dentistry (SMD) invested a total amount of GHS 456,199.08 in Liberty Asset which, is not a commercial bank and does not meet any minimum capital requirements of Bank of Ghana”, paragraph 1009 of the audit report on Public Boards noted.

    The SEC explained that the license of Liberty Asset was revoked over the failure of the company to “return client funds which remain locked up and in a number of cases, has even folded up their operations.”

    Citi News has further noted observations in the Auditor-General’s reports however, that indicate that the anomaly regarding the University of Ghana’s case is a consequence of the Colleges’ failure “to develop a monitoring mechanism to ensure that all units adhere to the university’s directives”.

    The report warned that this development could further hurt the University’s fragile financial administration.

    “Furthermore, any investment amount lost by the university may be disallowed and surcharged against the affected officers in accordance with Article 187 of the 1992 Constitution of Ghana and Section 18 of the Audit Service Act 2000, Act 584,” the report added.

    Meanwhile, the University’s management has indicated that the said investments were “made before the Vice Chancellor’s instruction issued on 4 October 2018. The investment was being rolled over as efforts made to call in the investment were not successful”.

    “Liberty Asset is currently under receivership and follow-ups are being made. Investment Committee has been reconstituted and has issued guidelines on investments as of February 2020 pending the finalization of the investment policy. This is to ensure that such incidences do not recur,” University authorities added.

    The University has since insisted that it followed due process before the investment was made.