President of the Republic, Addo Dankwa Akufo-Addo, has, based upon the recommendations by KPMG, following its audit on the GRA’s contract with Strategic Mobilisation Ghana Limited (SML), established the need for the downstream petroleum audit services provided by SML.
According to the President, the state has benefited from the services provided by SML in the downstream sector, highlighting the increment in volumes of fuel and its corresponding tax surge in tax revenue.
In a five-page statement from the presidency Wednesday, April 24, 2024, highlighting the findings of KPMG and its recommendations on its audit of the contract between the GRA, Finance Ministry and SML, the President expressed the need for SML’s services at the downstream sector due to the gains made after taking over the audit services.
“There is a clear need for the downstream petroleum audit services provided by SML. GRA
and the State have benefited from these services since SML commenced providing them.
There has been an increase in volumes of 1.7 billion litres and an increase in tax revenue
to the State of GHS 2.45 billion.
“KPMG also observed that there were qualitative benefits, including a 24/7 electronic real-time monitoring of outflow and partial monitoring of inflows of petroleum products at depots where SML had installed flowmeters and six levels of reconciliation done by SML. This minimises the occurrence of under-declarations,” portions of the President’s release contained.
The President, however, directed that the fee structure of the contract be reviewed.
“However, it is important to review the contract for downstream petroleum audit services,
particularly the fee structure. Given the experience and proficiency of SML over the last
four years of providing this service, the President has directed that the fee structure be
5 changed from a variable to a fixed fee structure. Other provisions of the contract worth reviewing include clauses on intellectual property rights, termination, and service delivery
expectations,” the statement added.
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Background
A report by the Fourth Estate, alleged irregularities in a multi-million dollar contract awarded to SML by the Ghana Revenue Authority (GRA). Despite the allegations, both the GRA and SML vehemently denied any wrongdoing.
In response to the accusations, SML has taken legal action against the Fourth Estate alleging defamation. The concerns raised regarding the contract between the GRA and SML prompted President Akufo-Addo to direct KPMG to conduct an audit into the matter.
On March 27, he received from KPMG its report on the audit conducted. Calls came for the President to make the findings of the audit public for Ghanaians to know if they taxes were being used for a good cause.
The President, following the calls, has issued a statement highlighting the findings and recommendations of the report, and attached with it his directives to the Finance Ministry and the GRA regarding the contract.
Find the full statement from the President here.
