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SML changed name from SMEL after PPA refused single-source approval on three occasions – Audit Report

KPMG

The full KPMG report that was released by President Akufo-Addo on Tuesday has revealed that Strategic Mobilisation Ghana Limited (SML) changed its name from Strategic Mobilisation Enhancement Limited (SMEL) after the company was listed for a single source contract and the Public Procurement Authority (PPA) refused to approve the process on three separate occasions in 2017.

Page 11 of the KPMG report said: “SMEL was incorporated on 14 February 2017. During the period 16 June and 14 September 2017, GRA made three (3) unsuccessful attempts to obtain PPA’s approval to single source SMEL to provide transaction audit services. On 22 November 2017, SMEL changed its name to SML.”

The report disclosed that the approval was denied because the company lacked “capacity or prior experience” in the delivery of the services.

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Page 14 of the KPMG report states that the GRA proceeded to award contracts to SML without the approval of the PPA.

The report said, “On 1 June 2018, SML was appointed a subcontractor to West Blue Ghana Ltd, then a service provider to GRA, to provide transaction audit services for seven (months) period ending 31 December 2018.”

It added: “On 1 January 2019, GRA executed without PPA’s approval, and extended transaction audit services agreement with SML, renewable on monthly basis, following the expiration of West Blue’s contract and SML’s subcontract agreement on December 31, 2018. GRA entered into six (6) service agreements with SML, utilising the single-source method without approval from PPA, as outlined below:

Transaction Audit Services— 1 June 2018
Contract Extension— 1 January 2019

External Price Verification Services— 1 April 2019

Consolidation Services Agreement (Transaction Audit & External Verification Services) — 3 October 2019.

Measurement Audit of Downstream Petroleum Products—3 October 2019.

Addendum to Measurement for Downstream Petroleum Products Agreement—29 July 2020

President Akufo-Addo contracted KPMG to audit the multiple contracts between SML, the Ministry of Finance, and the Ghana Revenue Authority (GRA).

This was after an investigation by The Fourth Estate discovered several breaches of the contract.

Meanwhile, it has emerged that the Ghana Revenue Authority failed to make deductions of value-added tax (VAT) on payments made to Strategic Mobilisation Limited (SML).

The report noted that SML’s work had contributed to increased revenue in the downstream petroleum sector.

According to the audit findings, SML received a total of GH¢1,061,054,778.00 from 2018 to the present while partially fulfilling its obligations.

SML has disputed receiving GH¢1,061,054,778.00 for its contract with the GRA, arguing that KPMG cited the figure “without reference to the investments made and the taxes paid” during the review period.

The report indicated that on payments to SML, KPMG observed that there was no deduction of value-added tax (VAT) by GRA for an eight-month period on payments.
 
By: Rainbowradioonline.com/Ghana

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