By: Musa S. Sheriff
The significant findings arising from the Special Audit of Gambia Telecommunications Company Ltd (GAMTEL), revealed that as at December 31, 2017, is the political uncertainty regarding the International Gateway.
The details of each of the Seven state-owned enterprises (SOEs) audit findings contained in the 445-page report made available to The Voice has been submitted to the Finance Minister, Mambury Njie, by the UK auditing firm, Ernst & Young LL, since August 2019.
“In September 2013, an Executive Directive issued by the Office of the President terminated this arrangement and henceforward required the revenues previously enjoyed by GAMTEL were instead paid into an International Gateway Account held at the Central Bank of Gambia.
In July 2017, the new Government of The Gambia terminated the contract of the incumbent Gateway Manager, and instructed GAMTEL to take over the management of the Gateway,” Ernst & Young LL revealed.
According to Ernst & Young LL, GAMTEL has remained the Gateway Manager since that time, incurring the costs of being the Gateway Manager.
“In November 2017, Ministry of Finance and Economic Affairs (MoFEA) instructed GAMTEL to transfer all International Gateway funds to the Central Bank of The Gambia. GAMTEL made a transfer of USD 2.5m (GMD 118m) during February 2018, but has not made any subsequent transfers.
The Board was advised that the correct procedure is for GAMTEL to submit these revenues to the Government’s account—and then for GAMTEL through its line Ministry, to separately make a case to the Government for any financial support that it requires from these ‘Gateway revenues’.
We understand from Senior Management that they have been instructed by the current Government of The Gambia not to use the International Gateway revenues that are GAMTEL’s retains,” Ernst & Young LL noted.
Ernst & Young LL further said, in response to this sequence of events, the External Auditors have required that International Gateway revenues should not be recognized in GAMTEL’s accounts.
The auditors also discovered that GAMTEL has continued billing customers who have in fact closed their accounts and were no longer using GAMTEL services one such balance for GMD 17m (USD 354,000) was identified and upon enquiry an additional nine balances totaling GMD 31m (USD 65,000) that arose in the same way.
Ernst & Young LL auditors noted that it was not feasible in the timeframe of the audit to perform additional work to quantify the totality of such balances.
According to EY there may be a significant number and value of post-paid debtor balances that arise from this error and are not genuine receivables, pointing that management needs to ascertain the full extent of this issue.
“A study published in July 2016 by consultancy firm Senghore Associates found that as at December 2014, GAMTEL employed 53% of the total staff of the Gambian leading Telecoms providers, more than double any competitor. Moreover, GAMTEL and GAMCEL combined employed 73% of the staff in the sector, at a time when they reportedly held a combined 21% market share.
During the confirmation testing, the auditor identified an account from Guaranty Bank with a description of “Dollar A/C:201-102593-2 4000-0 (Lc & Bc)” with a credit value of approximately USD 1m (GMD 54m). This account was not being reconciled. GAMTEL’s Finance team informed the auditors that this account is a ‘sub-account’ to the main GAMTEL account and it was not being reconciled,” Ernst & Young LL stated.
