The 2020 Auditor General’s Report has revealed that the Bulk Oil Storage and Transportation Company Limited (BOST) awarded a contract sum of US$39 million without following due processes.
This infraction pertained to procurement processes of BOST for the construction of its corporate Head office complex. The audit review disclosed that the Public Procurement Authority (PPA) approved a request for BOST to use Restricted Tendering in the procurement process.
BOST by this approval was to shortlist and select any of these Companies for the award namely; Amandi Holding Ltd, Rolider Company, Greycrest Construction Ltd and Projectual Engineering Services in a letter referenced PPA/ CEO/12/2474/15 dated December 23, 2015.
Prior to the approval by the PPA, the contract agreement had already been signed between BOST and Rolider Company dated June 5, 2015 at the total contract sum of US$39 million, the report reveals.
Also, the report highlights that supporting evidential documents including tender evaluation report, notification of award, acceptance letter, Central Tender Review Committee (CTRC) approval letter, performance security among others were not provided.
Furthermore, a request letter referenced BOST/SCR.35/PPA/PRO/SF.1/17569 and dated November 11, 2015 was sighted to have been sent to PPA for approval. The letter detailed a request to single-source Rolider Company to design, build and finance BOST corporate Head office complex but no approval letter was provided to that effect, the report notes.
Glaringly, the disregard for the guidelines of the PPA Act led to these infractions, the report indicates. More to the point, “possible procurement breaches could be left undetected as there are inadequate contract documentations to authenticate the procurement processes used by BOST before awarding the contract.”
Auditor General’s Recommendations
The report recommends that the Management of BOST should provide the supporting documentations and various approval letters from the appropriate approving authorities to support the procurement process.
Also, the Auditor General further entreated the Management of BOST to follow the procedures as enshrined in Section 90 of Act 663 of the Public Procurement Act to rectify the contravention.
In response, the Management of BOST acknowledged the infraction and indicated that the project suffers institutional memory as efforts to trace the required documents are riddled with challenges.
Another infraction cited involved the non-availability of signed contract documents for three Service Providers contracted by BOST to provide various services including insurance and medicals, among others. The Service Providers include Enterprise, Total House Clinic and All Garages. The report indicates this was the case as a total amount of GHS1.2 million was paid to all these Service Providers with US$642,946.67 for insurance premiums.
“Our enquiry disclosed that, Management entered into contract with most of the service providers four years ago. However, the contract documents could not be provided for our review. The only document made available was the renewal of contract letter, but the contractual document was no-where to be found as at the time of our audit in October 2020.”
Auditor-General’s Report
The Auditor General recommended that the Management of BOST should formalize the contract with these service providers and make available the contract documents for audit review. A call which BOST’s management accepted and gave the assurance that they had begun the processes of rectifying the anomaly.
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