FEARS are heightening over possible stall in GETFund projects across the country, especially internal projects because of lock up capital with an investment company.
This could be possible as captured by Auditor General’s report ending December 31,2020 because most of the projects, especially in-house are funded with income from investments.
Section 91 of the Public Financial Management Act, 2016, Act 921, requires that the Board of Directors of a public corporation governed by this Act shall ensure the efficient management of the financial resources of the public corporation including the collection and receipt of moneys due to that public corporation.
Also, Regulation 51 of the Public Financial Management Regulations, 2019, L.I. 2378 also states, except as otherwise provided in any other enactment, the collection of public and other trust moneys shall be the responsibility of the head of department, who shall appoint supervising collectors for each area where collection is required.
However, management of GETFund, according to Auditor General’s report had invested an amount of GH¢10,000,000 with SIC-FSL with an initial maturity date of 22 November 2018 at a rate of 20 percent per annum.
It is said that the investment was not honoured on maturity since it was rolled over with newly agreed terms of payment and SIC-FSL could not honour the terms agreed and as at the time of the audit the latest correspondence from the Fund to SIC-FSL dated 3 February 2020 had not been responded to.
Checks by the auditors revealed that the Fund manager was greatly affected by the financial sector clean up exercise as some of its counter parties were directly affected because bulk of the funds had been invested with savings and loans and microfinance companies which were affected by the financial sector clean up.
“This indicates that a number of projects (especially internal projects) could be stalled since most of the projects in-house are
funded with income from investments.
“There are a possibility of legal fees increases, should the fund decide to force the repayment in court,” the report stated.
Auditor General therefore advised GETFund to diligently pursue the agreed payment schedule and SIC-FSL engage constructively to ensure the investment is repaid in a timely manner.
Management Responded that “At a meeting held on the 5 February 2020 with the Managing Director (MD) of SIC-FSL was said to have served notice that it would set aside specific amount to be received from the Receiver of the defunct financial houses to settle the GETFund investment.
Meanwhile, management however, received a cheque of GH¢500,000 on the 19 of June 2020 as part payment of the outstanding amount although the payment plan requested has not been submitted.
By Vincent Kubi