101. 100 going for 2018 and 2019 Financial Years.

2. 1

102. 101

103. 102

5. 4 8.13.1.1 Physical Verification of Deliverables (Compliance Audit) ......................... .. 78 8.13.1.2 AUDIT REPORTS .................................................................................... ... . . 80 8.0 COMPLIANCE MATRIX................................................... ........................... ... 83

80. 79 (f) Review all contracts ensuring effective performance and value for money. Section 11 (2) (c) of the Public Finance Act, 2004 provides that: “...... internal auditors may investigate whether there are adequate measures and procedures for the proper application of sound economic, efficient, and effective management of public funds.” Finding The Internal Audit does not physically verify deliverables, such as contracts agreements, supply of procurement items to stores, fuel allocation, and distribution and so on. These deliverables needed to be audited from initiation to completion to ensure va lue for money. Implication In the absence of physical verification of deliverables, loopholes for corruption and substandard work will not be identified. Recommendation The Internal Audit Unit must physically verify all deliverables from initiation to completion. The Audit Unit should produce a quarterly report on deliverables for sound economic, efficient, and effective management of public funds. Management should ensure the Audit Unit was present and/or aware of deliverable. Management Response The recommendation of ACC is noted and necessary action will be taken.

104. 103 Published by the Anti - Corruption Commission Headquarters: 3, Gloucester Street, Freetown, Sierra Leone, West Africa Tel.No: 223645 Website: http//www@anticorruption.gov.sl Bo Office Address: 45, Kissy Town Road, Bo Email: info@anticorruption.gov.sl Makeni Office Address: Mena Hill Reservation, Makeni Kenema Office Address: Reservation Road, Off Maxwell Khobe Street Kono Office: 37 Masingbe Road, Koidu City Kono Hotline Nos: 077 - 985985 , 077 986 986 , 078 - 394111 515 (All Networks)

35. 34 According to the contractor roughly 70% of work at Mambo was ongoing but upon physical verification at the sites, the team could not determine that 70% of the work completed. The team could not ascertain the formula used by the contractor to reach a 70% conclusion. 8.5. 2.1 The Reservoir Support Water tapped from the weir will be stored at the reservoir, treated and ready for supplies to the community. At the site of the reservoir, the team could only verify the concrete base as the work was ongoing. Figure 5 : Concrete Reservoir Support 8.5.2.2 The “Kiosk The kiosk facility comprises PVC tank, the tank base and water point. The contractor had difficulties in mapping out pipes networks and kiosk locations. This has been resolved with the help of GVWC and NPAA. A total of 16 kiosks were to be constructed and located at different points in the communities. Only 16 kiosks have been erected to roofing while Plumbing, Plastering /Rendering Doors /Windows, tank, Fence, Painting and Picture reference were yet to be completed.

77. 76 The above table tells us that GVWC has achieved 6 out of the 8 metric performance areas stipulated by MCCU. GVWC has a total Earned Payment of USD1,273,254 collections performance just exceeded targ et of USD1, 113,850 with a total percentage of 114% . Implication Failure to achieve all its targets indicates weaknesses in the company’s performance management and this in turn will result to loss of revenue and increase in cost. Recommendations Management should review performance management for the targets not met. Management Response The recommendation of ACC is noted and necessary action will be taken. 8.12 DEBT MANAGEMENT Guma Valley Water Company has an accumulated debt of over sixty seven billion Leones (Le 67bn) from various sectors in the country. The table below shows the various debtors and total accumulated amount accrued.

81. 80 8.13.1.2 AUDIT REPORTS The Internal Auditor’s report supports companies in identifying key risk factors. It allows the company to forestall potential future concerns as well as identifying current weaknesses. It also identifies processes and controls that are not working effectively and enable an opportunity to impro ve on these. Finding We observed that the, 2018 and 2019 external audits were outstanding. At the time of the review, external Auditing was on going for 2018 and 2019 Financial Years. Implication Without regularly auditing weaknesses in the system will go undetected. Recommendation Management should ensure that External Auditing is done annually to mitigate the risk Management Response The recommendation of ACC is noted. With regards to the 2018 & 2019 Financial Reports Audited Financial statement is available for verification.

41. 40 The above table depicts an unfavorable balance of Le1,096,000 (one million and ninety six thousand Leones) from medical claims, which is about 0.44% excess. Some of the medical claims inspected by the team had no signature from the Medical Doctor at PDW to confirm the validity of the claims. We also, noted that the GVWC has no policy on medical claims and / refunds to staff. Implication Misuse / abuse of medical claims leads to a loss in the company’s income. A frequent unchecked medical request claim by staff members was a possible avenue for corruption. Recommendation s ➢ Management should ensure a policy be initiated for medical so as to avoid misuse/abuse. ➢ Management should look into the possibility of allocating an annual fund as medical for staff which should be included in their monthly salary as medical allowance. In addition, Management can also have a medical insurance scheme for staff to cover technic al staff who worked in risk prone areas. Management Response The issues raised have been noted and Management will take necessary steps to put in place measures that will ensure effective and efficient use of Company resources towards medical facility. Prior to the ACC Review,

62. 61 States dollars), which was equivalent to Le1,296,000,000 (One billion two hundred and ninety six million Leones) at an exchange rate of Le9,000 to $1. Upon verification, the team observed that out of the 4 vehicles budgeted for only 3 were procured at the cost of $195,148.80 (One hundred and ninety five thousand one hundred and forty eight united States Dollars eighty Penny) which was equivalent to Le1,8 32,886,316.80 (One billion eight hundred and thirty two million eight hundred and eighty six thousand three hundred and sixteen Leones eighty cents). Evidently there was a deviation from the budget being that only three of the four vehicles were bought and they were bought at an additional cost of Le536,886,316.80 (five hundred and thirty six million eight hundred and eighty six thousand three hundred a nd sixteen Leones eighty cents); an equivalent of $51,148.80 (Fifty one thousand one hundred and forty eight U nited States Dollars eighty Penny). No evidence was provided to the Review Team to show that due process was followed to deviate from the budget. No approved readjusted or supplementary budget was shown to the team with regards the alteration in the procurement plan with respect to the cost, specification and mode of delivery. Implication s ➢ Undertaking a procurement which exceeds the actual cost in the procurement plan affects cost. ➢ Unapproved and unregulated deviations or adjustments of budget will create opportunities for abuse and corruption. Recommendation

73. 72 Thirty Two Million, three hundred and fifteen Leones). This implies that GVWC had spent an excess (adverse) of Le 1,014,349 (One billion and Fourteen million three hundred and forty nine Leones) on transport /Fuel. An increase of 83% of the budget was utilized which could have hit other spending areas. Similarly, the sum of Le88,652 (Eighty eight million six hundred and fifty two thousand Leones) was budgeted for spare parts/ maintenance. An actual spending was Le434,891(Four hundred and thirty four million eight hundred and ninety one Leones) which resu lted to an adverse variance and /or excess spending of Le346,239 (three hundred and forty six million two hundred and thirty nine Leones). Furthermore, the two scenarios indicate that at GWVC the adverse variances/ unfavorable variances often points to the fact that something did not go according to plan, financially. Also, it would have been caused by improper budgeting where the baseline that had been set up had not been reasonably measured against the actual results. Recommendation The Management of GVWC should ensure that budget preparation was more realistic, efficient and effective. 8.10.1 Maintenance Plan Findings The team observed that there was no maintenance plan provided to the team yet maintenance was done on need bases. Also, no policy was provided on maintenance of GWVC fleets and machines. Implication Unplanned and unregulated expenses on maintenance will create room for wastage and misappropriation.

65. 64 Finding The review team did not find any evidence that the Procurement Unit communicated, debriefed and /or informed the unsuccessful bidder(s) in writing for procurements completed. Implication Withholding information to unsuccessful bidders as a prerequisite in procurement process raises suspicion. Recommendation For proper accountability and transparency, the Procurement Unit should always communicate in writing to all bidders whether successful or not. Management Response Letters of regrets are always sent to unsuccessful bidders, otherwise, to such bidders, it will be like the procurement process is still on course and there should have been correspondences to the Chairman of the Procurement Committee to that effect. 8.8.5 Requisition Book Finding All goods procured and supplied were being requested for through the requisition books but the Review Team observed that the finance unit does not sign the requisitions as required to ascertain the availability of funds and give approval yet the procuremen ts were undertaken. Implication

28. 27 ➢ The T eam realized that tanks in which water was stored before processing were filthy and looked unhygienic. Water is life but most of the tanks we saw were not clean though we were told they were cleaned on a weekly basis. Figure 3 : An Unhealthy Water Tank Implications ➢ There are weaknesses in revenue mobilization which has resulted to loss of revenue. ➢ There is lack of robust monitoring/supervision and regulation of revenue sources. ➢ There are strong indications that staff of GVWC are colluding with some water packaging companies to defraud the company. ➢ Water packaging companies with multiple production addresses but using single account number may be under declaring hereby not paying for all their production sites. Recommendations ➢ GVWC should set up a mechanism to enhanced revenue mobilization. .

26. 25 ➢ The table also, depicts that, GVWC was losing potential revenue of eleven million two hundred thousand Leones (Le11,200,000) on a monthly basis with respect to the number of machines in use by the various companies stated above. Upon physical verification of the list provided, the team discovered significant discrepancies with the number of machines registered / provided on the list to what was discovered on site. Most companies under declared the number of machines in use. 60% o f the water packaging comp anies checked/visited proved to be under declaring the number of machines they operate in their businesses. ➢ It was mutually agreed by the C ompanies and GVWC that faulty and/ or unused machines should not be in the production room. The picture shows machines which were declared faulty yet there were water sachets hanging on them, showing that they were workable. Clothes and bags were hung or spread all over the machines to make them appear unusable. Figure 2 : Disguised M achines ➢ The table below shows the number of machines unaccounted for as compared to list provided by Guma.

49. 48 In principle, the Finance Director and /or head of Accounts of all organizations have to be knowledgeable and / or aware of the financial transactions of the organization. According to a board document, it was observed that the Director of Finance became a signatory to the account of Guma Valley Water Company effectively on the 3 rd April 2019 upon appointment. Instantly, on the 30 th January 2020, a Board paper was approved by the Board Chair person stating that the Director of Finance should be replaced by the Director of Corporate Services. The operations at Guma with regards the signatory to account was quite complex as such direct ives came from the Board. Implications The Finance Director is the person responsible for all finances; therefore his exclusion from being a signatory will hinder his ability to exert control over finances as withdrawals may be made without his knowledge. Recommendation The Financial Director should be signatory to all accounts in with line best practices and responsibility accounting. Management Response Following the restructuring exercise, the issue of having the Director of Finance as signatory to the account was resolved. 8.6.2.9 Receipts/Supporting Documents Source document was a good internal control measure and provided evidence that a transaction occurred. Findings

56. 55 Le3,583,440,000 more than that budgeted and Le6,563,076,000 more than that reported in the unaudited financial statement for 2019.We could not get any reason(s) for such inconsistencies in the figures. Implication The inconsistencies in reporting amount spent on salaries undermine the credibility of the financial reports of the Company. It shows weak management of financial books and may also be a case of deliberately underreporting of expenditure relating to staffing which may take a huge portion of the Gross revenue of the Company. This will affects management ability to regulate expend iture on salaries. Recommendations ➢ The Finance Department and the Human Resource department should conduct regular reconciliation to identify and address inconsistencies. ➢ The Company should review its accounting procedures and records management to ensure that they give a true and accurate view of the Company’s financial position. Management Response The salary structure has always been reported as Direct and Admin Expenditures. The aggregate of salaries and wages in the 2019 Budget (Direct + Admin) amounted to Le12b, which gives a favorable variance when compared to the amount actual paid as per your Report. 8.7.4 Staff list and Payroll Finding Upon verification, the team observed variances between the payroll and the staff list.

67. 66 Finding The review team observed that bid documents were sold by the Procurement Unit for all procurements advertised as prescribed in the above section but no records of accountability were given to the team with respect to proceeds on sale of bid documents. Implication Non accountability of proceeds on sale of bid documents is a weakness in the procurement proces s inclusive of reconciliation. Recommendation Management should ensure that the company’s bank account numbers are spelt out in all bid documents to which bidders should pay and present bank slips to Finance Department. Bidders should then present the receipt issued by Finance Department to the procur ement Unit and in turn collect the bid document. This would ease accountability and reconciliation. Management Response The fund will be paid to GVWC cashier for special transfer into GVWC bank account 8.8.7 Procurement Committee Section 18 (1) of NPPA 2016 states that ‘a procurement committee shall be established in every procuring entity.. Also, according to S18(8) ‘a procurement committee shall make necessary arrangements to ensure that timely information on the execution, and conclusion of contracts by a Department or Division of a procuring entity, as well as on supplier, contractor or consult ant performance is reported to the procurement committee’.

44. 43 8.6.2.3 Withholding Tax Deduction Finding The 5.5% withholding tax deductions mandated by the Income tax Act 2000 was not deducted from suppliers payments. A large number of transactions examined involving payments to suppliers for the supply of goods, services and works did not indicate such deductions. A total of Le 150,000,000 (one hundred and fifty million Leones) was outstanding for the 2019 financial year. This amount had been deducted from suppliers but never paid to the National Revenue Authority (NRA) as prescribed by law. Implication Failure to submit withholding tax deductions from suppliers to NRA will lead to loss of revenue to government and would amount to an offence under the tax laws of Sierra Leone. This was a breach of Section117 of the Income tax Act of 2000. Recommendation The Accountant should ensure that 5.5% withholding tax deductions from supplier’s payment are payable as prescribed by the law. Management should ensure all outstanding on Withholding tax deductions are paid. 8.6.2.4 PAYE Section116 (1) Income Tax Act, 2000 provides that “An employer shall withhold tax from employment income. Management Response We have noted the ACC’s comments. Prior to the review, the Company was in dialogue with the Ministry of Finance for a cross debt settlement arrangement

36. 35 Figure 6 : Kiosk at Roofing Point 8.5. 2.3 Waterloo Community Reservoir The Waterloo Community is located at the mountain catchment area from which water is to be harvested and sent to the communities. The waterloo weir and Reservoir are far from completion. At the moment only 6 kiosks were under construction out of the total to be constructed. There have been tensions between the contractors and the community as well. The contractors have not been allowed to locate spots for the kiosk as there was resistance from the communities. Figure 7: Construction of the Reservoir at Foundation Level Most terrains where gravity water systems were constructed were rough, but the mambo gravity and the topography was unpredictable. The terrain was rough, poorly planned and not easily accessible. The weir was far away from the main road where vehicles could not pass through.

75. 74 ➢ Develop a fuel and fleet management policy that will ensure proper distribution and allocation of fuel. An effective Fuel Management policy ensured the best utilization of resources and allowed reduction of cost to a large extent. ➢ A weekly and/monthly reconciliation should be done on fuel allocation so that management would determine the stock and reorder levels. Management Response The recommendation of ACC is noted and necessary action will be taken. Management has approved a Fuel Management Policy which will be implemented. 8.11 RESULT BASED FINANCING (FRB) RBF is defined as any programe where the principal set financial or other incentives for an agent to deliver predetermined outputs or outcomes and rewards the achievement of these results upon verification (Musgrove 2020). Furthermore, it is a form of funding for project implementation or service provision where the principal, who provides the funding pays the agent who implements the projects or provides the service upon achieving predefined results. On the 28 th of May 2019, the GoSL and the United States of America (USA), through the MCCU entered into a Result Based Financing agreement with Guma valley Water Company (GVWC). MCCU had the responsibility to supervise and manage the implementation of the programme. A payment of an amount not exceeding US$ 1,300,000 (one million three hundred thousand united states dollars) minus an upfront investment cost of US$186,150 (one hundred and eighty six thousand, one hundred and fifty united states dollars) was paid into t he RBF project account at the Sierra Leone

68. 67 Finding We discovered that there is an existence of a Procurement Committee and minutes of meetings were presented to the team. As prescribed by the Act the Vote Controller is the chairman of the procurement committee. Implication Being the head/vote controller of an entity and the same time chairman of a procurement committee, constitute complicit of interest and there is possibility of the chairman uses his veto in the selection process. Recommendation The management of GVWC should ensure that the vote controller delegates such responsibility to avoid biasness, independence of the procurement officer/manager and a fair playing ground for suppliers. Management Responses The recommendation of ACC is noted and necessary action will be taken 8.9 STORES MANAGEMENT Guma V alley Water Company maintained two stores, a general and fittings stores. The store was controlled and managed by a Store Manager, an Acting Storekeeper and a Store Clerk. A Store Supervisor supervised these stores and items were manually recorded. Store management plays a strategic role in the supply chain by enabling inventory distribution, sorting process to meet the growing demand of the market. 8.9.1 AUDITORS VERIFICATION OF ITEMS IN STORE

46. 45 at Regent, Lumley; Wilberforce etc. without bank account details and /or Identification cards. Implication Cash handling by Account Officers can create vulnerabilities for misappropriation. Recommendation All payment should be done by Cheque and/or paid directly to the employees’ bank account. Management should ensure all workers submit bank accounts details for swift accountability. Management Response The payment over the counter relates to contract workers engaged for short period (between 1 to 3 months). The recommendation is however noted and action will be taken to ensure payments are made by cheque or through bank accounts. 8.6.2.6 Petty Cash Findings A petty fund (float) was provided to all departmental heads to undertake transactions involving petty expenses for the upkeep of their departments/Unit on a monthly basis The following were observed by the team: - ➢ The team was informed that all petty cash should be approved by the Managing Director before payment is effected by the Finance Department. Upon verification, it was observed that some petty cash vouchers were not approved by the Managing Director, yet payment was effected. ➢ Furthermore, the team realized that multiple petty cash approvals are made to different directorate on a monthly basis. There is no specify float

48. 47 Petty cash being one of the alternative forms of payment when compared to cheques and bank transfers is usually used to settle or pay for i tems with small monetary value. 8.6.2.7 Qualification of the Director of Finance For someone to become a Director of Finance, he/she should be knowledgeable in accounting practices and procedures and possesses the requisite academic qualifications such as Chartered Accountant (ACCA, CIMA, CIPFA,CPA etc.), a Master’s of Science degree in Finance and Accounting and/or MBA in Finance/Accounting . The team observed that the Director of Fina nce and Administration does not have any such qualifications and as such, the competences in managing such a department are questionable. Implications Finance is the bloodline in any organization and having a non - Accountant to manage the financial affairs of the Company affects the efficiency/diligence of the company Financial Management Recommendations Management should ensure that appropriate action is taken to recruit a qualified person to fill the position of Director of Finance Management Response The recommendation from ACC is noted. Prior to the ACC report, the Board carry out a restructuring and re - deployment of staff to address the issue raised . 8.5.2.8 Signatory to Account

10. 9 The operating budget on the other hand, portrays the Ministry’s recurrent expenses, expected costs, and estimated income, considering the quarterly or the annual performance. The team will then assess the utilization of such approved budgets with reference to activities and/or projects in the Ministry’s Strategic and annual work plans. Budgetary allocations form an integral component to the annual financial plan, or budget, of all MDAs. They indicate the level of resources an MDA is committing to a department or program. Without allocation limits, expenditures can exceed revenues and res ult in financial shortfalls. Anyone working with budgets should understand how they are used and the limitations they provide . The budget preparation process is a powerful tool for coherence. The budget is both an instrument of economic and financial management and an implicit policy statement, as it sets relative levels of spending for different programs and activities. 2.0 OBJECTIVE The essence of the review is to track resource utilization and ensure the Ministries/D epartment /Agencies makes effective use of its resources in line with the budget. The review aims to identify weaknesses in budget process that will create opportunity for corruption and proffer recommendations to address those weaknesses . 3.0 SCOPE The review examined budgets allocated by the Ministry of Finance to the Ministry of Water Resources for financial year 2019. The central focus of the review is on recurrent (operating) budget. However, limited samples of capital expenditures were also examined.

31. 30 Bypassing the Guma registration/system meant a loss of revenue to the company as these companies were not paying bills to GVWC . Recommendations The management of GVWC should ensure that all water packaging companies are registered and updated on the list. Management Response The recommendation is noted and necessary action will be taken to address the situation. 8.4 DONOR FUND/PROJECT MANAGEMENT The Company received support from various donors and international partners, namely 8.4.1 MILLENNIUM CHALLENGE COMPACT (MCC) The Company through the support from Millennium Challenge Compact (MCC) has procured the service of a Consultant for the development of an application for Tariff increase for submission to the Sierra Leone Electricity and Water Regulatory Commission (SLEWR C). The MCC also through Adam Smith International (ASI) is also funding the project to construct of water kiosks at kingtom and Aberdeen. The construction of Water Kiosk and installation of pipes, fittings and meters is almost complete at Aberdeen whilst the construction of Water Kiosk and installation of pipes, fittings and meters at Kingtom is 50% complete. 8.4.1.2 DEPARTMENT FOR INTERNATIONAL DEVELOPMENT (DFID ): As part of its contribution to the CoVID 19 response commissioned the IMATT COMMUNITY WATER SUPPLY PROJECT. The project involved construction of

24. 23 ➢ The Finance Director should ensure that all data collected from various departments are matched up and /or reconciled before the final presentation of the financial statement so as to give a clear picture of the financial position of the Company. Therefore monthly or at least quarterly reconciliatio n be done. ➢ All variances should be properly investigated and addressed. Management Response Commercial Department Reports are generated from the EDAMS Billing Software. The software generates billing and collection reports only. Therefore, payment that do not relate to water sold like GoSL support and Donor grants, proceeds on disposal of assets, dividend received, rent received etc. are not captured in the EDAMS Billing Software. Unlike the Comm ercial Dep artment Reports, t he Finance Dep ar t ment Reports captures the comprehensive income received from various sources including EDAMS. 8.3.2.2 Water Packaging Companies as own R esource R evenue Water packaging companies are major revenue source for Guma. They are billed based on the number of machines they use in production and packaging. GVWC demand charge per machine is Le700,000 and each company is charged Le90,000 as water rate on a monthly basis.

14. 13 The Trogas report shows the expenditure pattern per quarter, revenue received (actual allocation) from Government of Sierra Leone (GoSL) and also gives a reflection of the MDAs cash book. 7 .0 GUMA VALLEY WATER COMPANY (GVWC) Guma Valley Water Company (GVWC) was established by the Guma Valley Water Ordinance in April 1961 as a government - owned entity, with a mandate to supply portable water to residents in Freetown and its environs between Sussex and Allen Town. The main source of supply is from the Guma Dam at Mile 13 which accounts for about 95% of the water to Freetown and its environs. Other smaller sources that supplement the supply from Guma Dam are Kongo Dam, Sugar Loaf weir, Charlotte weir, Cemetery Blue weir, Thunder H ill weir and White - Water weir. The Guma Dam was constructed when the City’s population was less than 500,000 inhabitants. Studies have shown that the demographics of Freetown changed rapidly from the 1990s due to influx of refugees during the years of civil conflict. The population of F reetown is now over 1.5 million people and a good number of them depend on GVWC water for their daily sustenance. Under its 1961 Ordinance and the recently enacted Guma Valley Water Company Act 2017, the Utility has the exclusive mandate to supply /provide access to potable water to both residential and non - residential consumers in the Western Area of Sierra Leone. The coverage area has now been extended to cover communities like Hastings, Kossoh Town, Waterloo, Tombo, and Newton . The Organizational Structure was revisited to reflect the structures set out in the GVWC Act 2017 and a Deputy Managing Director position was established for improved operational efficiency. In line with the GVWC Act 2017, the operations of the Company are run under four Departments which are headed by four Directors.

32. 31 water intake structures, 500m of pipeline to transmit the water to the storage tank 200cubic of concrete reservoir, 3km of 50mm pipeline with 8 public stand posts that will serve an estimated population of 20,000 persons. World Vision: The GVWC connected 45 community tanks to the distribution network with support from World Vision. 8.4.1.3 The World Bank is funding the Freetown Emergency Recovery Project. The p rocurement of Pipes and fittings for the rehabilitation works on the network is 40% complete. First set of pipes has been delivered on site and Implementation of the FERP was in progress and was expected to complete by mid - November 2020. 8.4.1.4 Freetown Water Supply and Sanitation Master Plan Studies funded by AfDB and D2B Two (2) Consultants have been procured for both the Priority project (Hydrophil & AWSE) and the Master plan studies (CoBA/SMEC). GVWC Website development is in progress and procurement of IT equipment’s is at an advance stage 8.4.1.5 Freetown WASH & Aquatic Environment Revamping Project funded by AfDB, IsDB, Kuwait Fund, EBID, Saudi fund, GCF, GoSL, NEA, & OFID Funding has been confirmed by some of the donors like AfDB, IsDB, Kuwait, OFID and GoSL. Four (4) Vehicles have been procured for the Project Implementation Unit including Technical Assistants. Contracts for Four (4) Technical Assistants have been signed and the procurement processes for the Environmental TA, Sanitary TA are at an advanced stage. The Project Steering Committee has also been inaugurated . 8.5 PROJECT MANAGEMENT

66. 65 Bypassing the finance department to give a fair view with regards available funding before executing the procurement affects financial management process. Recommendation Management should ensure that before a procurement process is undertaken, the requisition book should be filled, signed, approved, by all parties more especially to ascertain the availability of funds by the Finance Department and forwarded to the Procurem ent Unit for action. Management Response At GVWC, the Finance Department does not give approval for procurement to be undertaken but the Vote Controller does. The Finance and Admin Director usually give concurrence for payments to be made and moreover a sign out on cheques and transfers, and in that note, the Finance Department is not by passed. There has been an approved budget out of which the procurement plan is emanated . However, for due diligence as regards to control ‘payables” the requisitions are now submitted to Finance Department for their concurrence on availability of funds. 8.8.6 Bidding Fees Section 48 (1) of NPPA 2016 states that “ An invitation to bid, or an invitation to prequalify, shall be published in the Gazette, national print media of wide circulation and electronic media”. It is a norm that Procurement Units do sell biding document to bidders at a specific fee. This document had detailed information with regards the procurement in question.

53. 52 8.7.1 HANDING OVER NOTE Handover Notes are documents created by staff members who are about to leave their positions, either temporarily or permanently, to assist their successor to carry out their duties. The Purpose was to provide their successor with key knowledge and information regarding the position for smooth transition and continuity. Findings The team observed that most senior staff does not leave handing over note to their successors while proceeding on leave. Likewise the subordinates also failed to provide a detailed handing over note to their superiors upon resumption of duty. Implication Failing to submit a detailed handing over notes will deprive the successor the key knowledge regarding the position. Recommendations Management should ensure that a detailed handover is made so that successors will settle into the position more quickly and easily, and feel more comfortable and confident with the processes of the new job . Management Response It has now become a policy of the Company that senior and Executive staff must prepare a handing over note whenever they are proceeding on annual leave. 8.7.2 ACTING/ RESPONSIBILITY ALLOWANCE Findings

64. 63 procurement contract, or from the date of rejection of all bids or cancellation of the proceeding, as the case may be. Finding The team observed in relation to the above section that proper filing system of procurement documents was not maintained. Procurement files were placed on the floor instead of them being shelved in the office of the Procurement Office. Implication The absence of a proper filing system render audit trail very difficult. Placing files on the floor would lead to document misplacement. Recommendation The Procurement Unit should ensure that all files are shelved accordingly. Management Response There is a new fabricated 8 - sided filling cabinet now in the Procurement Unit that is used to house the procurement documents. 8.8.4 Debriefing |Unsuccessful Bidder Section 27 of the NPPA Act states that procuring entity shall immediately, after a successful bidder has been identified, inform the unsuccessful bidder(s) of the reason for which their respective bids were unsuccessful. By the provisions of Sec 28 (1) , Subject to this Act, documents, notifications, decisions and other communication referred to in this Act to be submitted by the procuring entity to a bidder, or by a bidder to the procuring entity, shall be in writing

43. 42 Management Response s ➢ The audited Financial Statements for 2019 is now available and the audit exercise for the 2020 Financial Statements is in progress. ➢ The review of the Financial and Accounting Policies and Procedures Manual is in progress and to be completed by the end of the year. 8.6.2.2 ASSET REGISTER Finding The team was not provided with a Fixed Asset Register and we noted that most of the company’s assets procured with the exception of those donated by MCCU were not coded. Implication Operating without a valid asset register is a high corruption risk issue as it will be difficult to distinguish between government property and private ones. Recommendation s ➢ Management should ensure that all company’s assets are coded to avoid misuse and to distinguish them from private use. ➢ Also, ensure that the Finance Department should develop a comprehensive assets register. The Internal Auditor should be responsible for the verification of the assets register. Management Response The process of developing a comprehensive fixed asset register is in progress. Inventory of fixed assets and coding have been done.

54. 53 The review team observed that the position of the Administrative Manager had been vacant for a number of years. However, the Director of Finance and Administration had been receiving responsibility allowance for this position even though the job is belo w his status and there was no due process for him to receive that allowance as he was the supervisor or line Manager of the vacant position. Implications Collecting responsibility allowance for a vacant position and/or position below the rank of Director without following due process was an abuse of office and a recipe for corruption. Recommendation ➢ Management should ensure that the Finance and Administration Director refunds such allowance(s) collected for the vacant position of Administrative Manager for the entire period. ➢ Management has to ensure that acting/responsibility allowances are paid to employees who are acting in a senior position rather than the reverse. Management Response The recommendation is and necessary action will be taken. 8.7.3 Leave Allowance Findings The team observed that on the 30 th April 2020 , part of the leave allowance was paid ( cheque number 02428629 ) to the Director of Finance and Administration. However, when the Director of Finance and Administration was proceeding on leave, he was paid in full his annual leave allowance rather than the outstanding leave pay

18. 17 7 .2.3 Budget Committee Findings There was no evidence to show that a Budget Committee existed to guide the budget process. Implication Without a Budget Committee It will be difficult to guide the budget and ensure budgetary controls. Recommendation s ➢ The Company should immediately constitute a Budget Committee comprising of all heads of departments and representative of the Board. ➢ The Committee should be given the free hand to guide and regulate the budget process. Management Responses The comments from the ACC are noted. A Budget committee will be constitut ed as per ACC’s recommendation. 8.3 BUDGET FUNDING The Company’s key funding sources are the government of Sierra Leone, Own Source Revenue (OSR) and Donors. GVWC does not receive subvention from Government to undertake their budgetary activities. Budgetary activities are tied with it revenue generated from its Own Source. Notwithstanding the fact that no subvention allocation is

45. 44 of debt owed by MDAs to GVWC and GVWC’s debt to NRA with regards to PAYE and WHT. Finding During the review, the team observed the non - payment of PAYE totaling Le 10,478,047,309.46 (ten billion, four hundred and seventy eight million and forty seven thousand three hundred and nine Leones forty six cents) was deducted from staff salary at source as Pay As You Earn Tax (PAYE) but never paid to the regulatory authority. Implication Failure to fulfill tax obligations does not only deprive the State of much needed revenue, but it is also a violation of tax laws. Recommendation s ➢ All PAYE taxes must be paid promptly and Management should ensure mechanisms are put in place to regularize outstanding PAYE. ➢ Management and Anti - Corruption Commission should investigate the amount deducted but not paid to National Revenue Authority (NRA). Management Response We have noted the ACC’s comments. Prior to the review, the Company was in dialogue with the Ministry of Finance for a cross debt settlement arrangement of debt owed by MDAs to GVWC and GVWC’s debt to NRA with regards to PAYE and WHT. 8.6.2.5 Cash Handling Finding It was also discovered that huge cash was handled and paid over the counter by the Account Clerk to various workers. The payment was made to 200 staff

17. 16 Implications ➢ Without the participation of departmental staff, the budgets tend to be less accurate and closer to the actual situation on the ground therefore making the public budget less equitable and ineffective. ➢ Late preparation of budget will render spending unguided and vulnerable to misappropriation. Recommendations ➢ We recommend that the budget process be highly participatory. That is, the budgeting process starts at the departmental level and moves up to higher levels. Every department within the institution will be required to prepare plans for its proposed activiti es for the next budget period and estimate the costs it will incur. These individual budgets are combined to get a master budget. ➢ Annual budget should be prepared and approved before the start of every financial year . Management Responses ➢ Preceding the processing of the annual Budget, budget circularization is sent to all Directorates and Heads of Unit for their various inputs into the Budget process. ➢ The vacant position of a Budget Officer was advertised and recruitment process is in progress. Once completed, all management accounting functions will be undertaken by the Budget Officer ➢ The position of Management Accountant will be considered once the cash flow situation improves. ➢ GVWC Management has however noted the comments regarding the submission of activity plans for preparation of subsequent Budget.

47. 46 given on a petty cash request per month as there is no policy on petty cash disbursement. ➢ Also, it was observed that there were no receipt and/ or supporting documents on most of the petty cash retirement submitted to support their claims. Implication s ➢ Collecting petty cash funds on multiple occasions within a month shows waste of resources. ➢ Bypassing the Managing Director (Vote Controller) is a breach of procedure and raises concerns regarding unapproved cash disbursements and spending. ➢ Disbursing funds for petty cash without a float and policy will lead to abuse of company’s financial resources. ➢ Replenishing petty cash with supporting document is poor accounting and reporting procedures. Recommendations ➢ The Financial Accountant should ensure that all petty cash requests are approved by the Managing Director before payments were effected. ➢ Management should ensure that a petty cash policy should be developed and properly regulated with clearly indication of the float to be issued per month per department. Also, petty cash disbursement should be made on a monthly basis to departmental heads and reimbursed after reconciliation with the relevant support ing documents. Management Response The Company’s Petty Cash Policy allows a Directorate with more than one Unit under his/her control to maintain more than one petty cash floats.

1. 0 REPORT ON THE REVIEW OF BUDGET ALLOCATIONS AND UTILIZATION IN THE WATER SECTOR: GUMA VALLEY WATER COMPANY 2021 ANTI - CORRUPTION COMMISSION

16. 15 A 5 years Strategic Plan exist and can be made available. 7 .2.2 Participation in budget Preparation Section 44.9 of the Financial and Accounting Policies and Procedures Manual (final draft July 2007) of Guma Valley Water Company states that “all Senior Managers and Area Managers are expected to manage their affairs within the approved budget. Once budgets have been approved at head office level, mechanisms sho uld be in force to allocate these figures to areas and departments. Finance Managers will satisfy that appropriate arrangements are in place.” Finding s ➢ The T eam found that the Board requested the expertise of the Director of Corporate Services (a Chartered Accountant) to prepare the Company’s 2019 and 2020 budget. ➢ Furthermore, the budget preparation process was fully handled by the Finance Unit as the post of Management Accountant was vacant. There was also no Budget Officer. The budget preparatory process was not fully participatory. ➢ The budget is not prepared prior to the commencement of the financial year. It was mostly prepared in August whilst the financial year run from January to December. ➢ It is stated in the Financial M anual that budget must have a supporting schedule. The T eam did not see such schedule and could not set eyes on any departmental activity plan and/or proposal in line with the budget with regards budget implementation. The budget did not allocate any resources to the various management levels linked with depart mental objectives and strategic priorities. In essence, the budget is not participatory.

22. 21 From the data it is clear to see that some revenue sources are not providing enough as one will anticipate. For example one will expect high revenue from domestic clients taking into consideration the high number of dwelling houses. There is no strategy in place to investigate the poor performance of these revenue sources. There are accusations that domestic bills are written off/adjusted without any proper guidelines or procedures. Implication The low revenue from some revenue streams gives an indication that the revenue collection drive is weak or that revenue generation is been underreported. Recommendation s ➢ The Company should conduct annual review of the performance of its revenue streams in a bid to investigate poor performance and device strategies to enhance revenue generation. ➢ Targets should be set for each revenue stream and any shortfall investigated. ➢ There should be regular audits of revenue generated to ensure leakages are plugged. ➢ The B illing S ystem and its related matters should be reviewed. ➢ A clear policy or guide should be developed on how customers can challenge bill and how bill can be adjusted, waived or settled. Management Response The recommendations are noted. Prior to this Report, Management engaged the services of 12 Enumerators for house - to - house field verification and update of the database. Furthermore, close attention was given to the valve regulation

37. 36 Figure 8 : Terrain leading to the Weir at Mambo Forest reserved areas surrounding the weir situated at Mambo was seriously experiencing deforestation, coal mining, timber and/wood harvesting. These activities adversely affected the water flow to the dam. Figure 9 1 : Deforestation of reserved land Figure 10 : Coal M ining Site after T imber L ogging

33. 32 8.5.1 THE 45 INDUSTRIAL BOREHOLES PROJECT (MAMBO / HAMILTON / WATERLOO GRAVITY WATER PROJECT) The 45 Industrial Boreholes Project was used by the Review Team as a sample to examine how projects are managed by the Company. The 45 Industrial boreholes project came into existence after the major water supply challenge that hit Freetown in the dry season of 2016. This project was identified as a medium term project by the end of 2016. The project got cabinet approval in 2017 un der the leadership of Hon. MomoduMaligi. The project was spear headed from its inception by the Ministry of Water Resources. A total of 15 reservoirs (3 units to 1 system) were incorporated into the project. The industrial borehole was estimated to deliver at least 10m³/h each. This means that every reservoir would have been supplied with 240m³/day of water complementing the c urrent water supply. This would have benefitted a total population of around 30,000 people. The cost of the project was US$9.9 million which was equivalent to Le78 Billion as at October 2017 when the project was approved by cabinet. 8.5.1.2 THE NEW SCOPE OF THE PROJECT GVWC initiated the idea of changing the scope to gravity systems because of the uncertainties with boreholes. Until a proper study was carried out to clearly determine well fields locations, it was opined that the existing scope will not meet the value for money. The Ministry decided to engage the contractors to look at this possibility and if it was not already too late. The contractors agreed to a scope change and requested to visit all the sites before any action was taken. A site visit to all the locati ons were carried out and Bills of Quantities & drawings were generated by GVWC and SALWACO engineers. The scope (attached with this summary note) included; i. development of gravity water supply systems in Waterloo and Hamilton; procurement of 20km of distribution pipelines of various sizes;

60. 59 There is no dedicated expenditure code for recruitment process. Expenditures on recruitment process are charged to their various account codes; e.g., advertisement will be charged to communications, snacks and drinks during the interview will be charged to communications. The budget was however making provisions for personnel cost for the increase in staff due to recruitment . 8.8 PROCUREMENT MANAGEMENT 8.8.1 PROCUREMENT PLAN According to Section 29 (1) of the NPPA 2016, all procuring entities shall undertake procurement planning, with a view to achieving maximum value for public expenditures and the other objects of this Act. Finding There was a procurement plan but the review team noted that the procurement plan was inclusive of non - procurement items which were already taken care of in the budget. Items such as Salaries and wages, Nassit payments etc. Implication Including non - procurement items such are salaries and wages is not in line with Section 29 (1) of the NPPA 2016. Recommendation The Procurement Unit should ensure that procurement plans are inclusive of procurement items rather than the inclusion of non - procurement items.

34. 33 ii. development of gravity water supply systems in Daru, Bendu, Yawei, Tongo and rehabilitation of borehole water supply system in Daru hospital. iii. The Ministry has completed the contract amendment process and the contracts have been signed by all the contractors and the Ministry of Water Resources. i v . The Mambo/Hamilton community water project was developed to help improve the safe drinking water situation along the peninsula. Since these communities were situated along Guma W ater C ompany transmission route, they depended mainly on its supplies just as many other communities along the peninsula. This in return reduced immensely the water supplies to the capital. 8.5.2 THE MAMBO RESERVOIR (WEIR) The weir is one of the foremost components of this project but the Review Team observed that it was still under construction. The T eam was concerned about its timely completion since we are now in the period for rains . Figure 4 : M a mbo Weir

71. 70 Figure 11 : Procured Equipm e nt not used Implication There were wastages of the Company’s resources all as a result of improper procurement planning. Recommendation Management should make sure that procurement of items are of the correct specifications and needs. Management Response Considering the age of GVWC Pipe network system, Management is aware of the non - availability of some of these items in the market. However, these items are procured in the event of emergencies or major breakdown of our network system. Therefore, these items are not wastage of company resources. 8.9.4 Store Environment The Store is not tidily kept though spacious as it is located in a disaster prone area and it floods during the rains.

69. 68 Findings Most items procured were taken directly to site without going through stores verification. The storekeepers only do post charge after the goods were delivered or used. Neither the storekeeper nor the Internal Auditor or both do witness the supplies of thes e goods. Implication Direct delivery of goods to sites without any verification by the storekeeper and the Internal Auditor might cause the goods supplied that did not meet the required specification . Recommendation Storekeepers should be allowed to take goods on charge before distribution to sites. Also, the Internal Audit Unit should have a representative to witness and/or verify all supplies. Management Response The recommendation of ACC is noted and necessary action has already been taken. Management has approved a Stores Policy and Procedure Manual which will be implemented. 8.9.2 RECORDS MANAGEMENT The T eam observed that stores records were poorly managed by the store custodians. Bin cards were not up to date and they were not shelved alongside the respective items. Also, upon physical verification, the review team observed the following inconsistencies on the bin cards: ITEM BID CARD BALANCE PHYSICAL BALANCE 2” Gasket 7 8

23. 22 system in a bid to increase access to water particularly for areas experiencing low pressure. The outcome of these activities will impact positively on revenue generation. 8.3.2.1 Revenue Generation R eporting The T eam collected data from the Finance and Commercial Departments on revenue generated. Upon verification of documents, we discovered that the revenue figures reported by the two departments were not consistent with each other. There was no evidence to show that the two departments conduct regular reconciliation to identify, investigate and address variances and as a result the accuracy of the figures reported for generated revenue become doubtful. The table below shows figures of inconsistency. The table above shows inconsistencies in figures presented to the team with regards revenue generation from the two departments. There is a variance of Le7,133,295,000 (Seven Billion one hundred and thirty three million two hundred and ninety five thousand Leones) between the two figures presented. Implication Failure to accurately report on revenue generated creates the risk of revenue being unaccountable and vulnerable to corruption. Recommendation s FINANCE DAPARTMENT LE’000 COMMERCIAL DEPARTMENT LE’000 29,042,743 21,909,448

9. 8 1.0 BACKGROUND INTRODUCTION The Anti - Corruption Commission (ACC) was established with the primary aim to prevent, investigate and prosecute corrupt offenders and to also provide accurate information to the general public on the dangers of corruption in our society. The preventive asp ect of the ACC is provided for in Section 7 and 8 of the Anti - Corruption Act of 2008 as amended. The ACC has benefited from Funds from the OSIWA to enhance the effectiveness and efficiency of the Prevention Department. Part of the fund is meant to conduct Thematic Review of the Ministry of Water Resources on budgetary allocation and Utilization inclusive of its agencies (except Sierra Leone Electricity and Water Regulatory Agency (SLEWRA) • Sierra Leone Water Company (SALWACO) • Guma Valley Water Company (GUMA) • National Water Resources Management Agency (NWRMA) When it comes to budgeting, identifying areas of weakness helps the government to allocate resources in a useful and sustainable manner. It’s important for the government to ensure that funds reach where it’s required the most. Therefore using past data to identify sections of the society in need of eco nomic welfare policies and implementing those policies helps the government demonstrate efficient governance and achieve economic stability in the country. The Ministry of Finance is a key player in the Budget allocation to Ministries Department and Agencies (MDAs), therefore, our work required the cooperation and collaboration with the Ministry. Capital expenditures refer to funds that are used by the Ministry for the procurement, improvement, or maintenance of long - term assets (projects) to improve the efficiency or capacity of the Ministry.

79. 78 ➢ Management of GVWC should establish and execute a strategy for managing the debt in order to raise the required amount of revenue at the lowest possible cost over the medium to long term, consistent with a prudent degree of risk. ➢ Furthermore, a debt management policy should be instituted for all debtors and lastly, a robust debt collection team has to be constituted. Management Response The recommendation of ACC is noted and necessary action will be taken. 8.13 BUDGET CONTROL In practice it meant regularly comparing actual income or expenditure to planned income or expenditure to identify whether or not corrective actions are required. 8.13.1 INTERNAL AUDIT According to the Institute of Internal Auditor (IIA), "Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes." 8.13.1.1 Physical Verification of Deliverables (Compliance Audit) Section 6(4) of the GBAA 2005 states that the Internal Auditor has the following duties in the performance of its functions: Ensure strict adherence to all control procedures introduced to safeguard the assets and records of Government; and

74. 73 Recommendation The Management of GVWC had the responsibility to ensure that there is a detailed policy on maintenance which should be followed by an annual maintenance schedule/plan. Management Response The recommendation of ACC is noted and necessary action will be taken. 8.10.2 Fuel Management Finding s ➢ There was no proper accountability in the area of fuel management and fuel was distributed at the discretion of the Store Manager and the Head of Garage. ➢ There was no policy on fuel distribution and allocation as fuel was distributed to vehicles that were not in working order. ➢ With respect to fuel request procedures, it was observed that no technical knowledge was used to determine the quantum of fuel a vehicle or motorbike can consume per kilometer covered. In some transactions, fuel request forms were not attached to the fuel chit; ➢ Unavailability of fuel reconciliation reports with fu el suppliers on fuel allocation. Implication This was a clear indication of abuse of office and wastage of Company’s resources. Fraudulent fuel skimming can occur when drivers or thieves replace card readers at gas stations with a skimmer that captures cardholder data. Recommendation s

13. 12 Section 64 (1)PFM Act of 2016 states that “ A payment voucher for making payments to expenditures of a budgetary agency shall be certified by the vote controller of the budgetary agency or other public officer authorized by him ”. Section 18(1) of the Performance Financial Management - Regulation (PFM - R) 2018 stipulates that “ the budget call circular shall require every vote controller to submit within a specified time and in a prescribed manner a medium - term budget framework for his budget entity, including - (a) a medium - term strategy and target outcomes in line with national and sectoral strategies, and key performance indicators for assessing the achievement of the outcomes; (b) detailed work plans for the implementation of the strategy and the anticipated revenue and recurrent and capital expenditure for the following three years within the financial ceilings prescribed by the Minister; (c) a procurement plan showing details of the estimated amount of continuing contracts and each contract to be entered into in the following year, item to be purchased, estimated timing and amount of payments, and the modality of each contract; and (d) revised estimates of revenue and expenditure for the current year . Additionally , Section 18( 2 ) of the Performance Financial Management - Regulation (PFM - R) 2018 “ A vote controller shall, in preparing draft estimates of revenue and expenditure, convene a budget committee meeting to review and ensure that the estimates are realistic and accurate in all respects and are prepared with the involvement of all relevant di visional or programme officers, procurement officers, internal auditors and other relevant officials of the budgetary agency in accordance with any other instruc tion or guideline given by the minister.” In order for the Ministry of Finance to approve and disburse funds for a quarter, Ministry Departments and Agencies (MDAs) have to prepare and submit a Trogas Report for previous allocation disbursed by the Ministry (actual allocation).

61. 60 Management Response s ➢ The meaning of non - Procurement is expenditures that the company will incur, without a procurement method or not having to go through the P rocurement U nit. ➢ Regulation 28.(1) Procuring entities shall prepare a procurement plan for each fiscal year, containing the information required by Regulation29 using the template provided by the Authority.1 ➢ Annual procurement planning shall be fully integrated with applicable budget processes and circulars issued by the Authority and instructions of the Ministry of Finance. ➢ The Procurement Plan template that is in use is issued by the National Public Procurement Authority, until unless otherwise advised by the Authority as stated above in Regulation 28(1) . ➢ A Procurement Plan must be in balance with the company`s budgeted expenditure. All Procurement activities/items are also emanated from the budget or taken care of in the budget. ➢ The budget is the intention of how the company wants to spend. However, Procurement Plan is the implementation. ➢ The meaning of non - Procurement is expenditures that the company will incur, without a procurement method or not having to go through the P rocurement U nit. 8.8.2 PROCUREMENT OF VEHICLES Both the procurement plan and the budget stated that 4 vehicles were to be bought at total cost of $144,000 (one hundred and forty four thousand United

42. 41 8.6.2 FINANCIAL MANAGEMENT 8.6.2.1 FINANCIAL STATEMENT Findings ➢ We discovered that the actual figures/amounts stated on the Financial Statements were unaudited figures. ➢ The Financial and Accounting Policies and Procedures Manual (final draft July 2007) of Guma Valley Water Company, was out dated and yet still a draft. ➢ The Management Accountant Position is vacant till to the time of the conclusion of our review. Implications ➢ Without the financial statements being audited, it leaves the accuracy and authenticity of the figures unverified thereby casting doubt whether the financial statements represent the true state of affairs of the company. ➢ Lack of approved and updated Financial Manual creates challenges in applied modern trends in financial regulations and standards. ➢ Management accountant plays an important role the stewardship of financial management. For example they design the frame work of cost and financial accounts and prepare reports for routine financial and operational decision making. Therefore a lack of one will create challenges in managing the finances of the Company Recommendations Management should ensure that: ➢ The vacant management accountant position is occupied to affect the budgetary process. ➢ Departmental activity plan are prepared in line with the budget ➢ The Accounting Policies and Procedure Manual be revised and updated

59. 58 Management Response A loan portfolio with a dedicated account was established at the SLCB in 2 020 and currently in operations 8.7.6 Recruitment Processes Findings ➢ A total of Le429,868,356.77 (four hundred and twenty - nine million eight hundred and sixty - eight thousand three hundred and fifty - six Leones Seventy - seven Cents) was budgeted for on recruitment process. The team observed that this amount was reported as part of salaries and wages for proposed staff to be recruited but in an interview with officers of the HR unit it was stated that the above amount was cost associated with the recruitment process . ➢ The C ompany Recruited a total of 21 staff in 2019 but no evidence of cost associated to the recruitment process provided to the team. Implication Failure to effectively allocate amount to actual cost centers and heading will distort the financial report of the Company. Recommendation s ➢ Management through the Human Resources Unit, should certify that a coasted manpower recruitment plan be included in the budget separate from salary amount. ➢ All monies spent on recruitment processes should be accounted for with the necessary supporting documents. Management Response

38. 37 Findings ➢ The Review Team observed the following across the various projects assessed: ➢ There were weak project management and monitoring mechanism in place. No project document was presented to the Review Team to determine the project phases/benchmarks and timelines. This makes it very difficult for progress of the project to be monitored and necessary actions taken. Also it is difficult to determine the basis or justification on which payment to contractors have b een made so far. ➢ No project specifications were made available to the Review Team ➢ There were marked delays in the approval of funds from some of the donors. ➢ There were also delays in the implementation of projects ➢ There were challenges in accounting for the projects. Report on project funding and expenses were hard to come by. ➢ There were weak monitoring systems of the projects. No monitoring reports by Guma besides the copy of project update submitted by the contractor. ➢ There are strong indications that proper planning and consultation were not done with the communities and as a result the project in some areas lacks vital community support. Stakeholders analysis was not done. ➢ The Company is failing to take necessary actions to protect the investments. Some project sites are experiencing deforestation which will affect vital supply to these sites. Implications ➢ Delay in funding will result to delay in project completion and increase in cost due to inflation etc. ➢ Without proper accounting and monitoring systems in place, it will be difficult to identify or detect project deviations and misappropriations.

40. 39 ➢ A clear formula/metric should be used to assess work done. Milestones should be set for various activities Management Response This is correct. Please note the comment above. This is correct. The Contractor was stopped from carrying out any further works by the Military as the location falls within their training area. The CDS was engaged and the issue has been resolved. 8.6 BUDGET A RY ITEMS The T eam conducted a random sample of some budget items and compared same with the actual (unaudited financial statements) to determine the variance (if any). 8.6.1. MEDICAL EXPENSES/CLAIMS GVWC has a medical facility at the Public Works Department (PWD) with a Doctor who worked on a 2hrs daily basis. The facility has stationed nurses. Staff is beneficiaries to medical facility and they can make claims when seeking medical attention from hospitals depen ding on the medical conditions of persons concerned. Medical bills are forwarded to the Human Resources Manager for actions to be taken on the refund of such medical claims. Ideally, for a claim to be honored by the company, it has to be vetted by the Doctor at PWD before HR starts the process for payment or refund. The table below shows the budgeted amount as against Actual amount for staff medical for the period under review. BUDGET LE’000 ACTUAL LE,000 VARIANCE LE,000 244,560 245,656 1,096

39. 38 ➢ Deforestation decreased the capacity of soil infiltration of water , increases soil erosion, and decreases the quality of water at the source. The loss of trees and other vegetation can cause climate change, desertification, soil erosion, fewer crops, flooding, increased greenhouse gases in the atmosphere, and a host of problems for indigenous people. ➢ Owing to the distance covered from the main road to the site, it was highly likely that the work will not be completed on time because transporting the materials to site on a difficult terrine involved more labour and hence had has cost implications. Recommendations ➢ The Company should establish an effective project management and monitoring mechanisms for all its projects. ➢ The donor should ensure that funds are provided on time. ➢ Implementation should be within projects timeframe. ➢ All projects should have proper accounting mechanism in place. ➢ There should be effective monitoring systems ➢ The ACC should conduct investigations into all projects. ➢ GVWC/Contractor should have community engagement with the stakeholders of the community to identify land/locations for the kiosks to be erected. ➢ Protection and restoration of forests were included among the targets required to achieve the United Nations Sustainable Development Goals (SDG 6: Clean Water and Sanitation). SDG 15 explicitly indicates the value of forests with reference to the attainmen t of clean drinking water. ➢ The Management of GVWC should work with the Freetown City Council (FCC), and the Ministry of Agriculture and Forestry (MAF) to organize tree planting in the said areas and also work with NPAA to station Forest Guards in the area to ensure that these activi ties are put under control. Also, the Ministry of Lands and Country Planning to ensure the areas are protected from land grabbers.

12. 11 a unit to be known as the Budget Bureau which shall, under the supervision of the Financial Secretary, be responsible for the preparation and monitoring of the budget in collaboration with the budgetary agencies ”. Section 20(2) of the Government Budget and Accountability Act (GBAA) of 2002 states that “ each budgetary agency shall establish a budget committee comprising the vote controller, the professional head, if any, programme managers and provincial and district managers, to be responsible for preparing the strategic plans and annual estimates of the agency, apportioning quarterly allocations and monitoring expenditure and results.” Section 53 (1) (GBAA) of 2002 provides that “ the vote controller of a budgetary agency shall, within ten days after the end of each month, submit to the Financial Secretary, in the prescribed form, information on actual revenue and expenditure for the preceding month and the amounts anticipated to be collecte d or expended for that month .” Section 56 (1) of the Public Financial Management (PFM) Act of 2016 states that “ At the beginning of a financial year, the Minister may require a head of a budgetary agency to submit to him for his approval monthly forecasts under the Estimates for such period of time as specified by the Minister ”. Also, S ection 56 (2) of PFM Act of 2016 stipulates that, “ An appropriation allotment shall be prepared and submitted in such form and manner and by such date as may be prescribed by the Minister”. Furthermore, Section 56 (3 ) of PFM Act of 2016 “ notwithstanding subsection (1) and (2), the Minister may by himself determine and vary an appropriation allotment of a budgetary agency” . Section 15(2) of the Performance Financial Management - Regulation (PFM - R) 2018 states that “ A budget call circular shall give budgetary agencies and sub - vented agencies at least a six week - period for preparation of their budget proposal.”

63. 62 Management should ensure any adaptation to the procurement plan has to be followed by a supplementary budget stating the adjustment to the existing procurement. Management Response s ➢ Budget is a projection of expenditure in a future period based on certain assumptions. ➢ A Procurement Plan is projection of acquisitions to be made in a future period, based on certain assumptions. ➢ Since both instruments are planning tools, therefore they are not static or cast - in - stones. It is inevitable that there will always be variances and not deviations. ➢ To accommodate budget variances, budgeted lines and figures are mostly re - adjusted rather than involving in an extra budgetary process, meaning budgeting again for new streams of income. ➢ In a procurement Plan, there are fields for Plan and Actuals, therefore the procurement Plan will be updated to show the plan vs. actuals. ➢ Change in quantity is as a result of observations made in the prevailing market conditions as regards change the market prices at the time of acquisition process. ➢ GVWC is not a GoSL sub - vented Agency, therefore extra budgetary process is not usually applied in its case. 8.8.3 Records Management (Filing System ) Section 32 (1) of NPPA 2016 states that the procuring entity shall preserve all documentation relating to the procurement processes, in accordance with applicable rules concerning archiving of government documentation, but at a minimum for a period of six years following the date of final completion of the

20. 19 ➢ Having two different figures (actual) for revenue generation makes it difficult to ascertain the correct figure in making judgment. Recommendation s ➢ GVWC to investigate and determine the factors responsible for the drop in revenue and take necessary action to improve on revenue. ➢ Management should ensure, there is consistency in reporting figures so as to give a correct picture of the company’s finances. Management Response The reasons for the unfavorable variance in revenue generation was identified and it was partly due to non - approval of tariff, non - installation of meters, lack of adequate funds to undertake a comprehensive replacement of spaghetti connections with sub mains i n the areas listed in the activity plans. The budgeted was based on the implementation of the mentioned activities. 8.3.2 REVENUE STREAMS The Commercial Services Department is the hub of revenue generation of the GVWC. Revenues / income generations are derived from various sources including the following: ➢ Government/public Offices ➢ Bowser Water Deliveries ➢ Domestic Metered Supply ➢ Community Service ➢ Commercial/Business enterprises ➢ Residential ➢ Other Income

11. 10 4.0 METHODOLOGY The M ethodology for this study involved both quantitative and qualitative research. The team conducted interviews with key staff especially “those who bear the greatest responsibilities in the performance of their duties,” in line with the review objectives. The review process was initiated by an inception meeting with Management of the Ministry of Water Resources and its Agencies. The team examined information on: • Approved budgeted activities for the years under review • Actual allocations and/or notification of disbursement • Actual expenditure, utilization and accountability of allocation for years under review (actual) • Actual expenditure for periods under review • Balance of annual budget remaining • Variances • Bank statements • supporting documents of utilized budget • Returns per quarter and /or per annum • Physical verifications on projects and capital expenditures 5.0 LIMITATIONS OF THE REVIEW The Ministry of Finance did not provide information requested by the Review Team; as a result the review was based only on information provided by the Ministry of Water Resources and its Agencies. 6.0 THE BUDGET PROCESS Section 20 (1) of the Government Budget and Accountability Act (GBAA)of 2005 states that “ There shall continue to exist within the Ministry,

15. 14 Since there had been numerous allegations both in the print and electronic media about challenges faced in the management of water in this sector, the ACC through its Prevention Department, intervened to identify weakness and proffered recommendations in o rder to improve on service delivery. 7 .1 FINDINGS AND RECOMMENDATIONS 7 .2 BUDGET PREPARATION 7 .2.1 Strategic Plan Findings No Strategic Plan was presented to the Review Team which would have been the key guide for the budget preparation. Implications The strategic pl an lays out the direction and goals of the business and guidelines for actions to achieve those goals, while the budget looks at the money needed to support achieving those goals. Therefore if the budget is not aligned to strategic plan, the institution will struggle to fulfill its mandate and will result to wastages of resources. Recommendations ➢ We recommend that a S trategic P lan be developed in a participatory manner and clearly states the targets and goals of the I nstitution. ➢ This strategy should be popularized to all departments with a view that each department identifies its mandate and path in pursuing the overall goals. ➢ We recommend that the budget be aligned to achieving the goals set out in the Strategic Plan Management Responses

52. 51 It is evident from the illustration above that Director of Finance and Admin had collected a sum totaling Le26,000,000 (T wenty Six Million Leones) as salary advance from various dates. This amount was never deducted from his salary drawback and in essence the Finance Director still owes the Company Le26,000,000. The T eam went further to verify the payment transfer documents and noticed that Director of Finance and Admin transfers were not on file and could not be traced among other documents. All other payment slips for the other Directors were seen except that of the Director of Finance and Admin. Implication The salary advance collected by the Director of Finance without deduction from his salary payment is an act of corruption. Recommendations ➢ Management should ensure that Director of Finance and Admin refunds the excess of Le26,000,000 ( twenty - Six Million Leones) immediately or instruct payroll to deduct the said amount from his subsequent salaries. ➢ Evidence of deductions should be forwarded to the Anti - Corruption Commission Management Response The recommendation of ACC is noted and necessary action will be taken. 8.7 HUMAN RESOURCES MANAGEMENT 02 nd May 2019 5,000,000 21 st May 2019 6,000,000 Total 26,000,000

72. 71 Figure 12 : Store’s Environment Implication Due to the flooding, materials procured became rusty and caused loss of revenue to the company. Recommendation Management should relocate the stores to a more tidy location Management Response The recommendation of ACC is noted and necessary action will be taken. 8.10 GARAGE AND FUEL MANAGEMENT The budget of GVWC allocated a huge sum of money to engineering and fuel/transport and spare parts/maintenance. The table below shows analysis of the budgeted, actual and variances of amount utilized. The above analysis shows that a total of Le1,217,966(One Billion two hundred and seventeen million Leones) was budgeted for fuel with an expenditure (as provided in the trial balance) was Le2,232,315 (Two Billion Two hundred and Items Budget Le,000 Actual Le,000 Variance Le’000 Transport &Fuel 1, 217,966 2,232,315 (1,014,349) Spare parts/Maintenance 88,652 434,891 (346,239)

55. 54 Implication The practice of not deducting leave paid in advance from annual leave was tantamount to an abuse of office and corruption. Recommendation s ➢ Management should ensure that the Director of Finance and Administration refunds the advance payment that was made to him for his leave allowance; whilst this was not deducted from his full annual leave allowance when he proceeded on leave. .Also, the Financial Accountant should be queried for failing to comply with principles of basic booking. ➢ Furthermore, full blown investigation should be conducted by the Internal Audit Department on the Finance and Administration Department. Management Response The recommendation is and necessary action will be taken. The team observed that a huge chunk of the company’s budget went in to salaries. The table below shows the budgeted, actual and payroll figures with respect to salaries for 2019. Budgeted (A) (Le)’000 Actual (B) (Le),000 Variance ( A - B) (Le),000 Payroll (D) (Le),000 (A - D) (Le),000 5,977,515 2,997,879 2,979,636 9,560,955 (3,583,440) From the above table, there was a favorable variance between the budgeted figures for salaries as compared to the Actual figures in 2019 as shown in the unaudited financial statement. That is, they spent less on Salaries than what was budgeted for. However the Review Team’s analysis of the Payroll shows a contrary view as shown in column D of the Table above. It showed that actual amount spent on salaries was Le9,560,955,000 which is

29. 28 ➢ GVMC should conduct researches/surveys to effectively identify and capture all revenue streams ➢ A regulatory framework should be developed for all revenue streams with stipulated sanctions for breach of the framework.. ➢ There must be an effective monitoring and supervision mechanism for all revenue streams. ➢ GVWC should ensure that all monies embezzled by the water packaging companies are paid, while Guma is encouraged to do a full bill computation as a result of under declaration. Management Response s ➢ We note the comments on the in exhaustive list of customers and under declared machines. Following receipt of the report, Management requested responses from the Area Offices with regards to the ACC’s findings. Below are the responses: ➢ The Area T eams carried out verification in both the data base and field with regards to the existence of the water packaging companies shown on the report and the number that being operated. The outcome of the exercise confirmed the following: The mentioned customers have existing and active account in the data base. E.g. • ACADIA/AC - 130207 - ACADIA: also operating only one (1) machine. • FAMILY HIGH NEED/AC - 186737 - 141557 - 107425 - 183966 - FAMILY HIGH NEED: Family high need is operating ten (10) machines in all their locations even before and after your verification. • FAMILY FRESH PEACE MARKET: / AC - 117062. - FAMILY FRESH: Also operating a total three (3) machines • FOUNTAIN SPRING: / AC - 152871 - FOUNTAIN SPRING: were operating two machines and recently they inform the office that they are going to do one additional machine for which action has already been taken.

70. 69 Implication Failing to update bin cards can give wrong information about stock levels and would mislead the procurement decision making process. Recommendation Stores Manager should ensure that bin cards are updated on a daily bases and weekly reconciliation report should be submitted to MD as a way to keep him abreast of stock balances. Management Response The recommendation of ACC is noted and necessary action will be taken. 8.9.3 Procurement Wastages The team observed that items were procured which had no use to GVWC and they were packed in the store area unattended. The list below shows sample of them. ➢ 2 non - return valves from India DN 500 ➢ 8 valves of different sizes ➢ 2 Butterfly valves DN 600 ➢ 2 Butterfly valves DN 700 ➢ 2 DN 400 ➢ 2 DN 600 ➢ 5 INDEF Hercules machine 3” Gasket 11 2 8” VJ Coupling 18 14 12” VJ Coupling 8 7 2” Threaded tapering saddle 10 9

57. 56 The table below shows names of staff that were on the staff list but not on payroll T he above staff names were on the Staff list but these names were not traced on the payroll by the team. Furthermore, the under mentioned names were on the payroll but not on the staff list provided to the team. Staff ID Number Mohamed Sesay 872 Saidu Conteh 837 Emmanuel W Scott 575 Osman R Bangura 986 David Massaquoi 790 Mohamed Marco Koroma 870 Saidu C onteh 753 Baba Koroma 1026 AnsumanaKanu 942 Ibrahim T Kamara 994 Implications The Variances discovered in the payroll might indicate payroll fraud and caused loss of revenue to the company. Recommendations Management should ensure that Internal Audit conducts an audit on the payroll. The variances or inconsistencies should be regularized in order to save cost. Management Response The mentioned staffs are both in the payroll and staff list. The documents are available for verification . Staff ID Number GibrillaKamara 945 Ralph J Weekes 909

30. 29 • TUMAC PURE WATER: This customer was only operating one machine before and after the verification. • SO’PURE WATER: used to operate with 38 machines. There was restructuring in the Company and they are presently operating with 28 machines. ➢ The recommendations from the report are noted. Management will set up a team independent of the Area Offices to carry out field verification of machines used by water packaging customers. 8.3.2.3 Registration of Water Packaging Companies and other clients The T eam visited the Union of Water Packaging Companies to ascertain a comprehensive list of water packaging companies. From the data provided by both parties, it was evidently clear that a good number of companies were not registered with Guma (they tend to by pass the system) and Vice versa. The table below shows a sample of companies that were not on the list provided by GVWC . No. NAME ADDRESS 1 Calabash Drinking Water 62 Bass Street 2 Acadia Spring Pure Water 37 Jenneh Wright Road 3 Family High Needs 48 Jenner Wright Road 4 Kalains Pure Water Ogoo Farm 5 Sanus Pure Water Magazine Cut 6 Aqua Jah Murray Town 7 Aqua Best Lumley 8 Sonia Spring Juba Hill It is also evident that a number of households and businesses are not captured by the billing systems and therefore are not billed. Bills to clients are not sent on time and regularly Implication

19. 18 received from Government; yet Government do come in to augment capital expenditures undertaken by GVWC in ensuring water delivery to the nation. 8.3.1 OWN SOURCE REVENUE GENERATION GVWC is a revenue generation institution, and it main source of generating its revenue is from Own Sources. The various own source revenue streams, include: ➢ Government/public institutions ➢ Commercial/business enterprises ➢ Bowser Water Deliveries ➢ Domestic Metered Supply ➢ Residential ➢ Community Service ➢ Other Income The table below shows accumulated revenue generated for 2019 for the various revenue streams. These totals are compared with Budget, Financial Statements and figures collected from the Commercial Department. BUDGET LE’000 ACTUAL LE,000 VARIANCE LE,000 COMMERCIAL DAPARTMENT LE,000 48,407,211 43,098,743 5,308,468 29,042,743 19,364,468 From the table above, it is revealed that, there is an unfavorable budget variance of Le5,308,458 (Five Billion three hundred and eight million, four hundred and fifty eight thousand Leones) in revenue generation. It shows that GVWC could not meet its expected revenue growth target by 11%. Implication ➢ This variance implies that GWVC could not meet its set target.

25. 24 Figure 1 : A Production Centre Findings ➢ The T eam was provided with lists of water packaging companies divided into regions; East, West and Central. A random sampling was conducted from the lists provided and the following were discovered: ➢ The lists provided was not exhaustive as the team identified water packaging companies that were not on the list provided by GVWC as shown below: ➢ From the sample verified, the team discovered that the above names of water packaging companies were not on the list provided but were actively in production of sachet water. It was also proven that these companies were in possession of the number(s) of machine(s) as stated above. NO NAME NUMBER OF MACHINES Cost per machine (Le) Revenue unaccounted /lost (Le) 1 ACADIA SPRING PURE WATER 1 700,000 700,000 2 FAMILY HIGH NEEDS 8 700,000 5,600,000 3 FAMILY FRESH 3 700,000 2,100,000 4 FOUNTAIN SPRING 4 700,000 2,800,000 Total 11,200,000

78. 77 The above data is represented in the line graph below. ➢ The above table and graph highlight the amounts owed by various categories in the country. It is evident that the domestic sector has an accumulated debt of over forty one billion Leone (Le41bn), which makes them the highest debtors. ➢ It is explicit that, the debt collection process is either ineffective and /or not working. ➢ We also, observed that: There were no debt management plan agreement (Policy) between a debtor and a creditor (GVWC) that addressed the terms of an outstanding debt. ➢ T he enormous amounts of debt had affected the revenue mobilization process. ➢ Provisions were provided for these debts year in year out but the recoveries aren’t enough to correct the books. Implications Owing to the amounts accumulated and the time that has elapsed, most of these debtors would have closed, died or liquidated which would lead to bad debt. Recommendation s COMPANIES (Le) INSTITUTIONS (Le) GOVERNMENT (Le) DOMESTIC (Le) CHM (Le) COMMERCIAL (Le) BOWSER (Le) 321,704,150.97 507,366,123.01 13,572,413,767.88 41,018,828,847.93 76,879,689.33 9,557,142,959.04 2,213,793,898.97

85. 84 17 GVMC should conduct researches/surveys to effectively identify and capture all water packing companies and the number of machines registered. Researches/surveys to effectively identify and capture all water packing companies and the number of machines registered conducted. • The lists provided was not exhaustive as the team identified water packaging companies that were not on the list provided by GVWC • The Team discovered significant discrepancies with the number of machines registered / provided on the list to what was discovered on site. Researches/surveys to effectively identify and capture all water packing companies and the number of machines registered to be conducted. Survey R eport March, 2022 Permanent Secretary 18 A regulatory framework should be developed for all revenue streams with stipulated sanctions for breach of the framework. A regulatory framework for all revenue streams with stipulated sanctions for breach of the framework developed. There were no regulatory framework to regulate the water packaging companies. Leading to these water companies acting in their own selfish interest. A regulatory framework for all revenue streams with stipulated sanctions for breach of the framework to be developed. Regulatory framework March, 2022 Permanent Secretary

58. 57 8.7.5 Staff Loans As part of Management motivation to staff, a loan scheme was introduced for all categories of staff. The purpose of loaning staff was a Management decision to augment staff needs with a minimum interest rate rather than the high interest rate given by Comm ercial Banks the life span of the loan was 18 months with a minimal 7% charge as interest. The T eam observed that staff loan was not budgeted for in the budget and most of these loans are outstanding and far exceeded the loan period. The table below shows the loan schedules at various categories . Implication Issuing out loan to staff without an amount being factored in the budget would affect the operations of the company. Recommendation s ➢ Management should ensure a loan portfolio be set aside with a special account for the purpose of the loan. Also, interest on loan repayment should be paid in to the main Accounts. ➢ The repayment of loan should be strictly enforced. ➢ Alternatively, A Staff Welfare Association should be formed where an agreed amount should be deducted from staff salaries and paid into the staff welfare account. Loans can be paid to staff members from this account and process and procedures can be develo ped for this payment PRINCIPAL & INTEREST (Le) REPAYMENT (Le) BALANCE OUTSTANDING (Le) Senior Staff 28,730,000 38,613,611.11 12,400,555.55 Intermediate Staff 48,552,472.22 32,096,157.4 16,456,314.82 Junior Staff 221,965,500 135,922,861.4 86,042,638.60 Total 299,247,972.22 206,632,629.91 114,899,508.97

95. 94 72 There was a P rocurement P lan but the review team noted that the procurement plan was inclusive of non - procurement items which were already taken care of in the budget. Items such as Salaries and wages, Nassit payments etc. 73 Management should ensure any adaptation to the procurement plan has to be followed by a supplementary budget stating the adjustment to the existing procurement. Adaptation to the procurement plan followed by supplementary budget stating the adjustment to the existing procurement. H • No evidence was provided to the Review Team to show that due process was followed to deviate from the budget. • No approved readjusted or supplementary budget was shown to the team with regards the alteration in the procurement plan with respect to the cost, specification and mode of delivery. Adaptation to the procurement plan to be followed by supplementary budget stating the adjustment to the existing procurement. • Adaptations • Supplementary budget March, 2022 Finance department 74 The Procurement Unit should ensure that all files are shelved accordingly. Procurement files shelved accordingly. L The team observed in relation to the above section that proper filing system of procurement documents was not maintained. Procurement files were placed on the floor instead of them being shelved in the office of the Procurement Office. Procurement files to be shelved accordingly. Procurement files March, 2022 Procurement

50. 49 The T eam observed that some of the documents verified and examined were without receipts and other relevant documents to ascertain the completeness of the transactions with the suppliers. The table below shows sample of completed transactions without source documents during the period of October and November 2020. No Date Procurement Contract No. Receipt No. Amount (Le’000) Remarks 1 29/10/20 GVWC/FWKC/PLUMBERING/ING/2020 - 01 - 02 - 149,770 N o receipt from supplier attached 2 8/10/20 GVWC/FWKC/PLUMBERING/ING/2020 - 01 - 02 - 66,370 N o receipt from supplier attached 3. 29/09/20 GVWC/ING/FWKC/PLUMBERING/ADMIN/2020 - 01 - 02 - 137,070 N o receipt from supplier attached 4. 14/10/20 GVWC/ FWKCP/PLUMBERING/ING/2020 - 06 - 95,400 N o receipt from supplier attached Implication Without supporting documents to transactions it will be difficult to have an audit trail. Recommendation Management should ensure that all transactions should have complete supporting documents, including receipts, to finalize transactions. Management Response Receipts and supporting documents are available for verification. 8.6.2.10 Directors Salaries/Salary Advance Guma Valley Water Company has four Directorates and each is headed by a Director. The salaries of these Directors were not fixed at the time of appointment and it was agreed by Management that Directors are entitled to a salary advance until their salaries were regularized.

97. 96 78 The management of GVWC should ensure that the vote controller delegates such responsibility to avoid biasness, independence of the procurement officer/manager and a fair playing ground for suppliers. The function of the Vault controller in the procurement committee delegated. H We discovered that there is an existence of a Procurement Committee and minutes of meetings were presented to the team. As prescribed by the Act the Vote Controller is the chairman of the procurement committee. The function of the Vault controller in the procurement committee to be delegated. Composition of th e procurement committee March, 2022 Vault C ontroller S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of V erification (MOVs) Completion Date Responsible STORES MANAGEMENT 79 Storekeepers should be allowed to take goods on charge before distribution to sites. Storekeepers took goods on charge before distribution to sites. H Most items procured were taken directly to site without going through stores verification. The storekeepers only do post charge after the goods were delivered or used. Neither the storekeeper nor the Internal Auditor or both do witness the supplies of thes e goods. Storekeepers taking goods on charge before distribution to sites. • Sores ledger • Distribution list March, 2022 Finance department 80 The Internal Audit Unit should have a representative to witness and/or verify all supplies. The Internal Audit Unit had representative that witness and/or verify all supplies. H The Internal Audit Unit to have representative that witness and/or verify all supplies. Verification reports March, 2022 Managing Director

96. 95 75 For proper accountability and transparency, the Procurement Unit should always communicate in writing to all bidders whether successful or not. Procurement Unit always communicated in writing to all bidders whether successful or not. L The review team did not find any evidence that the Procurement Unit communicated, debriefed and /or informed the unsuccessful bidder(s) in writing for procurement completed. Procurement Unit to always communicate in writing to all bidders whether successful or not. • Bidders • Correspondences March, 2022 Procurement 76 Management should ensure that before a procurement process is undertaken, the requisition book should be filled, signed, approved, by all parties more especially to ascertain the availability of funds by the Finance Department and forwarded to the Procurement Unit for action. Requisition book filled, signed, approved, by all parties before undertaking procurement process. H T he Review Team observed that the finance unit does not sign the requisitions as required to ascertain the availability of funds and give approval yet the procurement were undertaken. Requisition book to be filled , signed, and approved by all parties before undertaking procurement process. R equisition book March, 2022 Managing Director 77 Management should ensure that the company’s bank account numbers are spelt out in all bid documents to which bidders should pay and present bank slips to Finance Department. Bidders should then present the receipt issued by Finance Department to the procurement Unit and in turn collect the bid document. Company’s bank account numbers spelt out in all bid documents to which bidders should pay and present bank slips to Finance Department. H The review team observed that bid documents were sold by the Procurement Unit for all procurement advertised as prescribed in the above section but no records of accountability were given to the team with respect to proceeds on sale of bid documents. Company’s bank account numbers to be spelt out in all bid documents to which bidders should pay and present bank slips to Finance Department. • Bidder payment slips • Bank statement March, 2022 Procurement

76. 75 Commercial Bank (SLCB).A cash amount of US$1,113,850 (one million one hundred and thirteen thousand eight hundred and fifty United States dollars) was paid. Findings ➢ Section 6.8 (Non - Allowed Uses) of the RBF agreement states that “the use of RBF payment shall be consistent with the policies and procedures afforded to all activities of MCCU, which include provisions that exclude the financing of certain activities and expenditures including but not limited to t he following: o A ny expenditure on alcoholic beverage, bad debt, contingency provisions, fines and penalties, lobbying costs, entertainment, social membership, fundraising cost, interest on borrowing capital or bonus payment to staff that are not part of a documented manag ement approved performance incentive scheme’. 8.11.1 RBF PERFORMANCE REWARD RBF is a performance reward based provided its set targets are achieved. The table below shows the reward based target and amount rewarded to GVWC. Performance area Metric Target achievement Earned Payment (USD) Target payment (USD) Billing and collections Total collections 101% 588,679 580,091 Government collections 100% 65,392 65,392 Leakage management Leak repairs 30% 53,434 179,780 Saddled connections 122% 38,549 31,500 Submain installations 200% 475,200 237,600 Supply reliability Valve regulation 0% 0 13,750 Regulations Reporting to EWRC 200% 42,000 21,000 Tariff review application 100% 10,000 10,000 Total 114% 1,273,254 1,113,850

8. 7 BUDGET EXECUTION 7 Medical expenses/claims The T eam, noted that GVWC has no policy on medical claims and / refunds to staff. • Management should look into the possibility of allocating an annual fund as medical for staff which should be included in their monthly salary as medical allowance. In addition, Management can also have a medical insurance scheme for staff to cover technical staff who worked in risk prone areas. Financial Statement We discovered that the actual figures/amounts stated on the Financial Statements were unaudited figures. The Financial and Accounting Policies and Procedures Manual (final draft July 2007) of Guma Valley Water Company, was out dated and yet still a draft. The Management Accountant Position is vacant till to the time of the conclusion of our review. • Management should ensure that: • The vacant management accountant position is occupied to affect the budgetary process. • Departmental activity plan are prepared in line with the budget • The Accounting Policies and Procedure Manual be revised and updated 8 Withholding Tax Deduction The 5.5% withholding tax deductions mandated by the Income tax Act 2000 was not deducted from suppliers payments. A large number of transactions examined involving payments to suppliers for the supply of goods, services and works did not indicate such dedu ctions. A total of Le150,000,000 (one hundred and fifty million Leones) was outstanding for the 2019 financial year. This amount had been deducted from suppliers but never paid to the National Revenue Authority (NRA) as prescribed by law • The Accountant should ensure that 5.5% withholding tax deductions from supplier’s payment are payable as prescribed by the law. • Management should ensure all outstanding on Withholding tax deductions are paid. BUDGET CONTROL 9 Cash H andling It was also discovered that huge cash was handled and paid over the counter by the Account Clerk to various workers. The payment was made to 200 staff at Regent, Lumley; Wilberforce etc. without bank account details and /or Identification cards. The payment over the counter relates to contract workers engaged for short period (between 1 to 3 months). The recommendation is however noted and action will be taken to ensure payments are made by cheque or through bank accounts 10 Petty C ash The team was informed that all petty cash should be approved by the Managing Director before payment is effected by the Finance Department. Upon verification, it was observed that some petty cash vouchers were not approved by the Managing Director, yet payment was effe cted. The Financial Accountant should ensure that all petty cash requests are approved by the Managing Director before payments were effected. 11 Receipts/Supporting Documents The team observed that some of the documents verified and examined were without receipts and other relevant documents to ascertain the completeness of the transactions with the suppliers. Management should ensure that all transactions should have complete supporting documents, including receipts, to finalize transactions. 12 Staff list and Payroll Upon verification, the team observed variances between the payroll and the staff list. The table below shows names of staff that were on the staff list but not on payroll Management should ensure that Internal Audit conducts an audit on the payroll. The variances or inconsistencies should be regularized in order to save cost.

7. 6 EXECUTIVE SUMMARY BUDGET PREPARATION NO FINDINGS RECOMMENDATIONS 1 Strategic Plan No Strategic Plan was presented to the Review Team which would have been the key guide for the budget preparation. • We recommend that if a strategic plan is not available the institution should develop one which should be participatory and clearly states the targets and goals for the institution. • This strategy should be popularized to all departments with a view that each department identifies its mandate and path in pursuing the overall goals. • We recommend that the budget be aligned to achieving the goals set out in the Strategic Plan 2 Participation in budget Preparation It is stated in the manual that budget must have a supporting schedule. The team did not see such schedule and could not set eyes on any departmental activity plan and/or proposal in line with the budget with regards budget implementation. The budget did not allocate any resources to the various management levels linked with departmental objectives and strategic priorities. In essence, the budget is not participatory • We recommend that the budget process be highly participatory. That is, the budgeting process starts at the departmental level and moves up to higher levels. Every department within the institution will be required to prepare plans for its proposed activities for the next budget period and estimate the costs it will incur. These individual budgets are combined t o get a master budget. • Annual budget should be prepared and approved before the start of every financial year 3 Budget Committee There was no evidence to show that a Budget Committee existed to guide the budget process. • The Company should immediately constitute a Budget Committee comprising of all heads of departments and representative of the Board. • The Committee should be given the free hand to guide and regulate the budget process. BUDGET FUNDING 4 Own Source Revenue Generation There is an unfavorable budget variance of Le5,308,458 (Five Billion three hundred and eight million, four hundred and fifty eight thousand Leones) in revenue generation. It shows that GVWC could not meet its expected revenue growth target by 11%. • GVWC to spend time finding out what factors caused the drop in revenue and take necessary action to improve on revenue. • Management should ensure, there is consistency in reporting figures so as to give a correct picture of the company’s finances 5 Water Packaging Companies as own resource revenue The team was provided with lists of water packaging companies divided into regions; East, West and Central. A random sampling was conducted from the lists provided and the following were discovered: • GVMC should conduct researches/surveys to effectively identify and capture all revenue streams • A regulatory framework should be developed for all revenue streams with stipulated sanctions for breach of the framework.. 6 Registration of Water Packaging Companies and other clients It is also evident that a number of households and businesses are not captured by the billing systems and therefore are not billed. Bills to clients are not sent on time and regularly. The management of GVWC should ensure that all water packaging companies are registered and updated on the list.

51. 50 Upon fixing of their salaries, the drawbacks were paid and salary advances were also netted off to arrive at the net salary for the month. The table below showed the breakdown: Director Monthly salary A No. of Months B Draw Backs (monthly salary x No. of Months) C = (A*B) Salary Advance D Net Pay E = (C - D) 50% Payment F = (E/2) Deputy Managing Director 24,503,531.25 7 171,524,718.75 117,000,000 54,524,718.75 27,262,359.38 Technical & Water Services 17,074,125.00 3 51,222,375.00 - 51,222,375.00 25,611,187.50 Finance & Admin 19,069,125.00 3 57,207,375.00 - 57,207,375.00 28,603,687.50 Commercial Services 17,361,666.67 3 52,085,000.00 10,000,000 42,085,000.00 21,042,500.00 Total 78,008,447.92 332,039,468.75 127,000,000 205,039,468.7 5 102,519,734.3 8 The table above shows the computation of payments made to Directors after regularization of their salaries with the necessary deductions. The company had spent Le332,039,468.75 (three hundred and thirty two million, and thirty nine thousand, four hundred a nd sixty eight Leone, seventy five cents) on salary drawbacks to Directors. A total of Le205,039,468.75 (Two hundred and Five million, and Thirty nine thousand, Four hundred and Sixty Eight Leones seventy five cents) was the net payment made after all deductions. Due to the challenges, the company was facing with regards finances, the net payments were to be paid in two equal installments of 50% each to the Directors. Column ‘F’ depicts the computations of 50% payments made and same amounts were paid la te. Upon verification from the cash book with regards salary advance, the team observed that Director of Finance and Admin had collected salary advance which was never recorded in the computations above. The table below depicts the order in which salary advanc es were collected and paid to Director of Finance and Admin. Dates Amount (Le) 10 th April 2019 15,000,000

86. 85 19 There must be an effective monitoring and supervision mechanism for all revenue streams. An effective monitoring and supervision mechanism for all revenue streams conducted. • The team realized that tanks in which water was stored before processing were filthy and looked unhygienic. Despite purporting that they are cleaned every week. • The team also discovered that a particular company ‘Family High needs” used a single account number for two different addresses. • It was also discovered that, other outlets which operated under the same business name operated with a different account number. An effective monitoring and supervision mechanism for all revenue streams to be conducted. Monitoring and supervision reports March, 2022 Monitoring Unit 20 GVWC should ensure that all monies embezzled by the water packaging companies are paid, Amount of monies embezzled by the water packaging companies paid, under declaration of the number of machines in operation claiming to be faulty and otherwise amounting Fifty - Five million th ree hundred thousand Leones (Le 55,300,000) on a monthly basis. All monies embezzled by the water packaging companies to be paid, Bank Statements, Payment vouchers and bank slips. March, 2022 Finance Department 21 Guma is encouraged to do a full bill computation as a result of under declaration. A full bill computation as a result of under declaration conducted by GUMA. A full bill computation as a result of under declaration to be conducted by Guma. Bill computation report March, 2022 Permanent Secretary 22 The management of GVWC should ensure that all water packaging companies are registered and updated on the list. Proportion of water packaging companies registered and updated on the list. It was evidently clear that a good number of companies were not registered with Guma (they tend to bypass the system) and Vice versa. All water packaging companies registered and updated on the list. - Register of water packaging companies March, 2022 Finance Department 23 It is also evident that a number of households and businesses are not

21. 20 The table below shows revenue collected from the various categories for the years 2019 and 2020 (September) The table above shows total revenue generated from the various categories/streams at the Commercial Department for the years ending 2019 and 2020 (excluding quarter 4). It also explains the increase and /or decrease in each revenue stream alongside their various percentage increase and / or decrease. It is clear that more revenue was generated in 2020 irrespective of the fact that a whole year’s revenue was not available because the review was conducted in September. Furthermore, there was an increase in revenue in every category except Commercial/Bu siness Enterprises which experienced a decrease of about Le 115,464,837.77 (one hundred and fifteen million four hundred and sixty four thousand eight hundred and thirty seven Leones seventy seven cents) which is a 1.35% decrease. Categories 2019 Le 2020 (Sept) Le Increase /(Decrease) Increase/ (decrease) % Residential 7,114,393,318.27 9,030,214,257.22 1,915,820,938.95 26.93 Commercial 8,562,524,230.82 8,447,059,393.05 (115,464,837.77) (1.35) Government 4,202,994,634.20 4,728,397,211.27 525,402,577.07 12.50 Institution 421,722,635.35 472,841,275.21 51,118,639.86 12.12 Bowser Water Delivery 1,341,347,500.00 1,718,460,000.00 377,112,500.00 28.11 Community Services 69,469,500.00 279,375,000.00 209,905,500.00 302.15 Other Income 196,996,092.00 450,301,430.63 253,305,338.63 128.58 Total 21,909,447,910.64 25,126,648,567.38

3. 2 T ABLE OF CONTENT LIST OF ABBREVIATION ..............................................................................................3 EXECUTIVE SUMMARY ................................................................................................4 1.0 BACKGROUND INTRODUCTION ......................................................................... 8 2.0 OBJECTIVE .......................................................................................................... 9 3.0 SCOPE ................................................................................................................. 9 4.0 METHODOLOGY .................................................................................................. 10 5.0 LIMITATIONS OF THE REVIEW ........................................................................ . . 10 6.0 THE BUDGET PROCESS ...................................................................................... 10 7.0 GUMA VALLEY WATER COMPANY (GVWC) ........................................................ 13 7.1 FINDINGS AND RECOMMENDATIONS ................................................................ 14 7.2 BUDGET PREPARATION ...................................................................................... 14 7.2.1 Strategic Plan ....................................................................................................... 14 7.2.2 Participation in budget Preparation ..................................................................... 15 7.2.3 Budget Committee ............................................................................................... 17 8.3 BUDGET FUNDING ............................................................................................... 17 8.3.1 OWN SOURCE REVENUE GENERATION .............................................................. 18 8.3.2 REVENUE STREAMS ............................................................................................. 19 8.3.2.1 Revenue Generation Reporting ........................................................................ 22 8.3.2.2 Water Packaging Companies as own Resource Revenue ................................ 23 8.3.2.3 Registration of Water Packaging Companies and other clients .................... ... 29 8.4 DONOR FUND/PROJECT MANAGEMENT ............................................................ 30 8.4.1 MILLENNIUM CHALLENGE COMPACT (MCC) .................................................... . . 30 8.5 PROJECT MANAGEMENT .................................................................................... . . 31 8.5.1 THE 45 INDUSTRIAL BOREHOLES PROJECT (MAMBO/HAMILTON/WATERLOO GRAVITY WATER PROJECT) .............................................................................. . 32 8.5.2 THE MAMBO RESERVOIR (WEIR) ... ............................................................ .. .... . 33 8.6 BUDGETRY ITEMS ............................................................................................. . . 39 8.6.1. MEDICAL EXPENSES/CLAIMS ........................................................................ ... . 39 8.6.2 FINANCIAL MANAGEMENT .............................................................................. .... 41 8.6.2.1 FINANCIAL STATEMENT ................................................................................. . 41 8.6.2.2 ASSET REGISTER .......................................................................................... ... 42 8.6.2.3 Withholding Tax Deduction ............................................................................. 43

98. 97 81 Stores Manager should ensure that bin cards are updated on a daily bases and weekly reconciliation report should be submitted to MD as a way to keep him abreast of stock balances. Bin cards updated on a daily bases and weekly reconciliation report submitted to MD as a way to keep him abreast of stock balances. M • The team observed that stores records were poorly managed by the store custodians. Bin cards were not up to date and they were not shelved alongside the respective items. • Also, upon physical verification, the review team observed inconsistencies on the bin cards: Bin cards to be updated on a daily bases and weekly reconciliation report submitted to MD as a way to keep him abreast of stock balances. • Bin cards • Reconciliation reports March, 2022 Stores Manager 82 Management should make sure that procurement of items are of the correct specifications and needs. Management made sure that procurement of items are of the correct specifications and needs. H The team observed that items were procured (such as, 2 non return valves from India DN 500, 8 valves of different sizes and 2 Butterfly valves DN 600) which had no use to GVWC and they were packed in the store area unattended. Management to make sure that procurement of items are of the correct specifications and needs. • Procurement list • Procured items March, 2022 Internal Audit 83 Management should relocate the stores to a more tidy location, Stores relocated to a more tidy location. M The Store is not tidily kept though spacious as it is located in a disaster prone area and it floods during the rains. Stores to be relocated to a more tidy location. Relocated stores March, 2022 Managing director 84 The Management of GVWC should ensure that budget preparation was more realistic, efficient and effective. A more realistic, efficient and effective budget preparation is ensured. H Budget preparation was full of adverse variance, unrealistic, inefficient and ineffective. A more realistic, efficient and effective budget preparation is ensured. Budget March, 2022 Budget Officer S/N Recommendations Indicator Activity (Input & output) Impor tance Baseline situation/ Challenges/Findings ACC’S Target Means of V erification (MOVs) Comp letion Date Responsible GARAGE AND FUEL MANAGEMENT

99. 98 85 The Management of GVWC had the responsibility to ensure that there is a detailed policy on maintenance which should be followed by an annual maintenance schedule/plan. A detailed policy on maintenance is crafted. H The T eam observed that there was no maintenance plan provided to the team yet maintenance was done on need bases. Also, no policy was provided on maintenance of GWVC fleets and machines. A detailed policy on maintenance to be crafted. Policy document March, 2022 Permanent Secretary 86 Accountability tools such as ledger, chit, request form etc in the management and distribution of fuel should be developed and effectively used. The development and effective utilization of accountability tools is ensured. H There was no proper accountability in the area of fuel management and fuel was distributed at the discretion of the Store Manager and the Head of Garage. The development and effective utilization of accountability tools to be ensured. Accountability tools March, 2022 Finance Department 87 Develop a fuel and fleet management policy that will ensure proper distribution and allocation of fuel. A fuel and fleet management policy is developed. H There was no policy on fuel distribution and allocation as fuel was distributed to vehicles that were not in working order. A fuel and fleet management policy to be developed. Policy document March, 2022 Permanent Secretary 88 Fuel calibration chat should be used to determine the quantum of fuel a vehicle or motorbike can consume per kilometer covered. The use of fuel calibration chart ensured. H With respect to fuel request procedures, it was observed that no technical knowledge was used to determine the quantum of fuel a vehicle or motorbike can consume per kilometer covered. The use of fuel calibration chart ensured. • Traveling requests • Fuel chits etc March, 2022 Fleet/ Transports 89 All fuel request forms should be attached to fuel chit. The attachment of fuel requests on fuel chits ensured. M In some transactions, fuel request forms were not attached to the fuel chit; The attachment of fuel requests on fuel chits to be ensured. Fuel requests and chits March, 2022 Fleet/ Transports 90 A weekly and/monthly reconciliation should be done on fuel allocation so that management would determine the stock and reorder levels. Unavailability of fuel reconciliation reports with fuel suppliers on fuel allocation; March, 2022

92. 91 (T wenty Six Million Leones) immediately or instruct payroll to deduct the said amount from his subsequent salaries. refunded by the Director of Finance and Admin. salary advance totaling Le26,000,00 (Twenty six million Leones) which was never recorded in the computations of salary advance or repaid. salary advance refunded by the Director of Finance and Admin. S/N Recommendations Indicator Activity (Input & output) Importan ce Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completi on Date Responsible HUMAN RESOURCES MANAGEMENT 56 Management should ensure that a detailed handover is made so that successors will settle into the position more quickly and easily, and feel more comfortable and confident with the processes of the new job. Detailed handover that helps successors to settle into positions more quickly and easily, and feel more comfortable and confident with the processes of the new job is conducted. H The team observed that most senior staff does not leave handing over note to their successors while proceeding on leave. Likewise the subordinates also failed to provide a detailed handing over note to their superiors upon resumption of duty. Detailed handover that helps successors to settle into positions more quickly and easily, and feel more comfortable and confident with the processes of the new job is conducted. - handover notes. March, 2022 Human Resources Department 57 Management should ensure that the Finance and Administration Director refunds such allowance(s) collected for the vacant position of Administrative Manager for the entire period. Allowance(s) collected by the Finance and Administration Director for the vacant position of Administrative Manager for the entire period refunded. H The review team observed that the position of the Administrative Manager had been vacant for a number of years. However, the Director of Finance and Administration had been receiving responsibility allowance for this position even though the job is belo w his status and there was no due process for him to receive that allowance as he was the supervisor or line Manager of the vacant position. Allowance(s) collected by the Finance and Administration Director for the vacant position of Administrative Manager for the entire period to be refunded. • Deposit slips • bank statements March, 2022 Permanent Secretary 58 Management has to ensure that acting/responsibility allowances are paid to employees who are acting in a senior position rather than the reverse. Payment of acting/responsibility allowances to employees who are acting in a senior position ensured. M Payment of acting/responsibility allowances to employees who are acting in a senior position to be ensured. • Acting positions • Salary vouchers • Payroll March, 2022 Permanent Secretary

82. 81 COM P LIANCE IMPLEMENTATION PLAN FOR THE GUMA VALLEY WATER COMPANY (GVWC) Anti - Corruption Objectives Budget Preparation S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completion Date Responsible Strategic Plan 1 We recommend that if a strategic plan is not available the institution should develop one which should be participatory and clearly states the targets and goals for the institution. A strategic plan that is based on participatory approach and clearly states the target and goals of the institution is developed. No Strategic Plan was presented to the Review Team which would have been the key guide for the budget preparation. A strategic plan that is based on participatory approach and clearly states the target and goals of the institution to be developed. Strategic plan Supporting documents March, 2022 Planning/Budget Officer 2 This strategy should be popularized to all departments with a view that each department identifies its mandate and path in pursuing the overall goals. Strategy popularized to capture the mandate and path of every department in achieving the overall goals of the organisation. Strategy to be popularized to capture the mandate and path of every department in achieving the overall goals of the organisation. • Correspondenc e • Communication plan March, 2022 Planning/Budget Officer 3 We recommend that the budget be aligned to achieving the goals set out in the Strategic Plan. Budget aligned to the goal in the strategic plan. Budget to be aligned to the goal in the strategic plan. • Budget • Strategic plan March, 2022 Planning/Budget Officer S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completio n Date Responsible Participation in budget Preparation 4 We recommend that the budget process be highly participatory. The budget process is highly participatory. The budget preparatory process was not fully participatory. The budget process to be highly participatory. • Budget circular • Departmental budgets March, 2022 Planning/Budget Officer

83. 82 5 Annual budget should be prepared and approved before the start of every financial year. Annual budget prepared and approved before the start of every financial year. The budget is not prepared prior to the commencement of the financial year. It was mostly prepared in August whilst the financial year run from January to December. Annual budget to be prepared and approved before the start of every financial year. Date of approval. March, 2022 Planning/Budget Officer 6 The Ministry should recruit a budget officer A Budget Officer is recruited There was also no Budget Officer. A Budget Officer to be recruited. • Appointment Letter • Staff List Sept . 202 2 Human Resources S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completion Date Responsible Budget Committee 7 The Company should immediately constitute a Budget Committee comprising of all heads of departments and representative of the Board. A Budget committee that comprise of all heads of departments and representatives of the board is constituted There was no evidence to show that a Budget Committee existed to guide the budget process. A Budget committee that comprise of all heads of departments and representatives of the board to be constituted Budget committee and composition March, 2022 Permanent Secretary 8 The Committee should be given the free hand to guide and regulate the budget process. The Committee is given the free hand to guide and regulate the budget process. The Committee should be given the free hand to guide and regulate the budget process. The Committee to be given the free hand to guide and regulate the budget process. • Memos • Draft reports March, 2022 Permanent Secretary S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completion Date Responsible Own Source Revenue Generation 9 GVWC to spend time finding out what factors caused the drop in revenue and take necessary action to improve on revenue. Causes of drop in revenue identified and action taken to improve revenue. There is an unfavorable budget variance of Le 5,308,458 (Five Billion three hundred and eight million, four hundred and fifty eight thousand Leones) in revenue generation. It shows Causes of drop in revenue to be identified and action taken to improve revenue. Causes and action taken. March, 2022 Finance Department

93. 92 59 Management should ensure that the Director of Finance and Administration refunds the advance payment that was made to him for his leave allowance; whilst this was not deducted from his full annual leave allowance when he proceeded on leave. The team observed that on the 30th April 2020, part of the leave allowance was paid (cheque number 02428629) to the Director of Finance and Administration. However, when the Director of Finance and Administration was proceeding on leave, he was paid in full his annual leave allowance rather than the outstanding leave pay. March, 2022 60 The Financial Accountant should be queried for failing to comply with principles of basic booking. The Financial Accountant queried for failing to comply with principles of basic booking. M The Financial Accountant to be queried for failing to comply with principles of basic booking. Query letter March, 2022 Human Resources department 61 Full blown investigation should be conducted by the Internal Audit Department on the Finance and Administration Department. March, 2022 62 The Finance Department and the Human Resource department should conduct regular reconciliation to identify and address inconsistencies. Regular reconciliation conducted There is inconsistency in reporting amount spent on salaries. That is, favorable variance between the budgeted figures for salaries as compared to the Actual figures in 2019. The Review Team’s analysis of the Payroll shows actual a mount spent on salaries was Le 9,560,955,000 which isLe.3,583,440,000 more than that budgeted and Le6,563,076,000 more than that reported in the unaudited financial statement for 2019. Regular reconciliation to be conducted. March, 2022 The Finance Department/the Human Resource department 63 The Company should review its accounting procedures and records management to ensure that they give a true and accurate view of the Company’s financial position. A review of the company accounting procedures and records management ensured. H A review of the C ompany accounting procedures and records management to be ensured. Review reports March, 2022 Managing Director 64 Management should ensure that Internal Audit conducts an audit on the payroll. Internal audit conducted on payroll. H The team observed that there is variance between the number of staff on the staff list and payroll and vice versa. Internal audit to be conducted on payroll. Internal audit report March, 2022 Internal Audit 65 The variances or inconsistencies should be regularized in order to save cost. The variances or inconsistencies regularized. H The variances or inconsistencies to be regularized. • Staff list • Payroll March, 2022 Human Resources department

84. 83 10 Management should ensure, there is consistency in reporting figures so as to give a correct picture of the company’s finances. Consistency in reporting figures so as to give a correct picture of the company’s finances is ensured by management. that GVWC could not meet its expected revenue growth target by 11%. Consistency in reporting figures so as to give a correct picture of the company’s finances to be ensured by management. Revenue reports March, 2022 Finance Department 11 The Company should conduct annual review of the performance of its revenue streams in a bid to investigate poor performance and device strategies to enhance revenue generation. Annual review of the performance of the company conducted, poor performance on revenue streams investigated and strategies to enhance revenue generation devised. There is no strategy in place to investigate the poor performance of these revenue sources. Annual review of the performance of the company to be conducted, poor performance on revenue streams to be investigated and strategies to enhance revenue generation to be devised. • Performance report • Investigation report • revenue generation strategies devised. March, 2022 Permanent Secretary 12 Targets should be set for each revenue stream and any shortfall investigated. Targets developed for each revenue stream and any shortfall investigated. Targets to be developed for each revenue stream and any shortfall investigated. • Revenue streams • Targets March, 2022 Finance department 13 There should be regular audits of revenue generated to ensure leakages are plugged. Revenue generated is regularly audited. Revenue generated to be regularly audited. Audit report March, 2022 Audit department 14 The billing system and its related matters should be reviewed. The billing system and its related matters reviewed. The billing system and its related matters to be reviewed. Review report March, 2022 Finance Department 15 A clear policy or guide should be developed on how customers can challenge bill and how bill can be adjusted, waived or settled. A clear policy or guide on how customers can challenge bill and how bill can be adjusted, waived or settled is developed. A clear policy or guide on how customers can challenge bill and how bill can be adjusted, waived or settled to be developed. Policy document - Permanent Secretary 16 Monthly or at least quarterly reconciliation be done. Monthly or at least quarterly reconciliation carried out. There was no evidence to show that the two departments conduct regular reconciliation to identify, investigate and address variances. Monthly or at least quarterly reconciliation are to be carried out. Monthly and quarterly R econciliation R eports March, 2022 Finance Department

100. 99 S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of V erification (MOVs) Completion Date Responsible RESULT BASED FINANCING RBF) 91 Management should review performance management for the targets not met. Performance management for the targets not met reviewed. H GVWC failed to achieve its target; as she achieved 6 out of the 8 metric performance areas stipulated by MCCU. Performance management for the targets not met to be reviewed. • Review reports • Actions taken March, 2022 Managing Director 92 Management of GVWC should establish and execute a strategy for managing the debt in order to raise the required amount of revenue at the lowest possible cost over the medium to long term, consistent with a prudent degree of risk. Strategies on how to manage the company’s debt established and executed. H Guma Valley Water Company has an accumulated debt of over sixty seven billion Leones (Le 67bn) from various sectors in the country Strategies on how to manage the company’s debt to be established and executed. • Strategies • Debt balance/repaid March, 2022 Managing Director 93 A debt management policy should be instituted for all debtors and lastly, a robust debt collection team has to be constituted. Debt management policy instituted and debt collection team constituted. H There were no debt management plan agreement (Policy) between a debtor and a creditor (GVWC) that addressed the terms of an outstanding debt. Debt management policy to be instituted and debt collection team constituted. • Debt management policy • D ebt collection team March, 2022 Managing Director 94 The Internal Audit Unit must physically verify all deliverables from initiation to completion. The Audit Unit should produce a quarterly report on deliverables for sound economic, efficient, and effective management of public funds. The Internal Audit does not physically verify deliverables, such as contracts agreements, supply of procurement items to stores, fuel allocation, and distribution and so on. March, 2022 95 Management should ensure that External Auditing is done annually to mitigate the risk. External Auditing done annually to mitigate the risk. H We observed that the, 2018 and 2019 external audits were outstanding. At the time of the review, external Auditing was on External Auditing to be done annually to mitigate the risk. External Audit R eports March, 2022 Managing Director

4. 3 8.6.2.4 PAYE ................................................................................................................ . 43 8.6.2.5 Cash Handling ................................................................................................. . 44 8.6.2.6 Petty Cash ...................................................................................................... . 45 8.6.2.7 Qualification of the Director of Finance ......................................................... .. 47 8.5.2.8 Signatory to Account ........................................................................................ 47 8.6.2.9 Receipts/Supporting Documents ...................................................................... 48 8.6.2.10 Directors Salaries/Salary Advance ............................................................... ... 49 8.7 HUMAN RESOURCES MANAGEMENT .................................................................. . 51 8.7.1 HANDING OVER NOTE ....................................................................................... . 52 8.7.2 ACTING/RESPONSIBILITY ALLOWANCE ............................................................ . 52 8.7.3 Leave Allowance ................................................................................................. . 53 8.7.4 Staff list and Payroll ........................................................................................ . . 55 8.7.5 Staff Loans ....................................................................................................... . . 57 8.7.6 Recruitment Processes .................................................................................... ... . 58 8.8 PROCUREMENT MANAGEMENT ........................................................................ . . 59 8.8.1 Procurement Plan ............................................................................................. . . 59 8.8.2 Procurement of Vehicles .................................................................................. . . 60 8.8.3 Records Management (Filing System) ............................................................. . . 62 8.8.4 Debriefing |Unsuccessful Bidder ...................................................................... . . 63 8.8.5 Requisition Book ................................................................................................ . 64 8.8.6 Bidding Fees ....................................................................................................... 65 8.8.7 Procurement Committee ................................................................................. ... 66 8.9 STORES MANAGEMENT ..................................................................................... 67 8.9.1 AUDITORS VERIFICATION OF ITEMS IN STORE .......................................... . . . 67 8.9.2 RECORDS MANAGEMENT .............................................................................. ... . 68 8.9.3 Procurement Wastages ................................................................................. ... . 69 8.9.4 Store Environment .......................................................................................... . . 70 8.10 GARAGE AND FUEL MANAGEMENT ................................................................ . . 71 8.10.1Maintenance Plan .......................................................................................... . . 72 8.10.2 Fuel Management ........................................................................................ . . 73 8.11 RESULT BASED FINANCING (FRB) ................................................................ . . 74 8.11.1 RBF PERFORMANCE REWARD ...................................................................... . 75 8.12 DEBT MANAGEMENT ....................................................................................... . 76 8.13 BUDGET CONTROL ........................................................................................ . . 78 8.13.1 INTERNAL AUDIT ....................................................................................... . . 78

94. 93 66 Management should ensure a loan portfolio be set aside with a special account for the purpose of the loan. The setting aside of loan port folio with special account is ensured. H The team observed that staff loan was not budgeted for in the budget and most of these loans are outstanding and far exceeded the loan period. The setting aside of loan port folio with special account to be ensured. • Special account • L oan port folio March, 2022 Finance department 67 Interest on loan repayment should be paid in to the main Accounts. Interest on loan repayment paid in to the main Accounts. H Interest on loan repayment to be paid in to the main Accounts. B ank transfer March, 2022 Finance Department 68 The repayment of loan should be strictly enforced. The repayment of loan strictly enforced. The repayment of loan to be strictly enforced. Loan overdue reports Mar ch, 202 2 HR 69 Alternatively, A Staff Welfare Association should be formed where an agreed amount should be deducted from staff salaries and paid into the staff welfare account. Loans can be paid to staff members from this account and process and procedures can be develo ped for this payment A staff welfare association formed. M A staff welfare association to be formed. Formation documents March, 2022 HR/Admin 70 Management through the Human Resources Unit, should certify that a costed manpower recruitment plan be included in the budget separate from salary amount. A costed manpower recruitment plan included in the budget separate from salary amount. H The team observed that this amount was reported as part of salaries and wages for proposed staff to be recruited but in an interview with officers of the HR unit it was stated that the above amount was cost associated with the recruitment process. A costed manpower recruitment plan to be included in the budget separate from salary amount. Costed manpower recruitment plan March, 2022 HR 71 Monies spent on recruitment processes should be accounted for with the necessary supporting documents. Monies spent on recruitment processes accounted for with the necessary supporting documents. H The company Recruited a total of 21 staff in 2019 but no evidence of cost associated to the recruitment process provided to the team. Monies spent on recruitment processes to be accounted for with the necessary supporting documents. Supporting documents March, 2022 HR S/N Recommendations Indicator Activity (Input & output) Importan ce Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completi on Date Responsible PROCUREMENT MANAGEMENT

91. 90 Managing Director, yet payment was effected. 51 Management should ensure that a petty cash policy should be developed and properly regulated with clearly indication of the float to be issued per month per department. The development of a petty cash policy that is properly regulated with clearly indication of the float to be issued per month per department is ensured. H There is no specify float given on a petty cash request per month as there is no policy on petty cash disbursement. The development of a petty cash policy that is properly regulated with clearly indication of the float to be issued per month per department to be ensured. Petty cash policy March, 2022 Permanent Secretary 51 Petty cash disbursement should be made on a monthly basis to departmental heads and reimbursed after reconciliation with the relevant supporting documents. Petty cash disbursement made on a monthly basis to departmental heads and reimbursed after reconciliation with the relevant supporting documents. H It was observed that there were no receipt and/ or supporting documents on most of the petty cash retirement submitted to support their claims. Petty cash disbursement to be made on a monthly basis to departmental heads and reimbursed after reconciliation with the relevant supporting documents. • Petty cash disbursement • Reconciliation report. • Supporting document March, 2022 Finance Department 52 Management should ensure that appropriate action is taken to recruit a qualified person to fill the position of Director of Finance. A qualified Director of Finance recruited. H The team observed that the Director of Finance and Administration does not have any such qualifications and as such, the competences in managing such a department are questionable. A qualified Director of Finance to be recruited. • Advert... • Appointment letter March, 2022 53 The Financial Director should be signatory to all accounts in with line best practices and responsibility accounting. The Financial Director made signatory to all accounts. H The Director of Finance was replaced by the Director of Corporate Services as signatory to the company’s accounts as approved by the Board Chair Person. The Financial Director to be made signatory to all accounts. • Accounts • Correspondences March, 2022 54 Management should ensure that all transactions have complete supporting documents, including receipts, to finalize transactions. Management ensured that transactions are completely supported. The team observed that some of the documents verified and examined were without receipts and other relevant documents to ascertain the completeness of the transactions with the suppliers. Management to ensured that all transactions are completely supported. Supporting documents March, 2022 55 Management should ensure that Director of Finance and Admin refunds the excess of Le 26,000,000 The excess of Le 26,000,000 ( T wenty Six Million Leones) as salary advance H The team observed that Director of Finance and Admin had collected The excess of Le 26,000,000 (Le twenty Six Million Leones) as • Receipt • Bank statement March, 2022

27. 26 ➢ The table above revealed machines under declared by the various water packaging companies and the number of machines claimed to be faulty by the various companies. Due to the number of machines under declared, GVWC was losing an estimated monthly revenue of Fifty Five million three hundred thousand Leones (Le55,300,000). ➢ The T eam also discovered that a particular company ‘Family High needs” used a single account number for two different addresses. - It was also discovered that, other outlets which operated under the same business name operated w ith a different account number. The table below explains. No Name No Of Machines On List As Per Document Provided Number Of Machines At production site Number Of Undeclared Machine Cost Per Machine Revenue Lost By GVWC Comments 1 Tumac P ure W ater 1 4 (2) 1 700,000 700,000 2 machines were declared faulty 2 So Pure 1 37 36 700,000 25,200,000 1 machine was provided on the list 3 Family Care 0 34 (9) 34 700,000 23,800,000 9 machines were declared faulty but none was on the list 4 BOKUM 0 8 (3 ) 5 700,000 5,600,000 No machine was recorded on the list. 3 were declared faulty Total R evenue as per machines undeclared 55,300,000 No. NAME OF COMPANY ACCOUNT NUMBER No. of Machines CONTACT No. ADDRESS 1 Family High Needs 141557 2 099311242/ 078287570 48 Jenner Wright Road 2 Family High Needs 141557 4 088649003/ 076684928 49 Jenner Wright Road 3 Family High Needs 107425 2 030492895 23 Jenner Wright Road 4 Family High Needs 183966 2 076245133 Peace Market, Kissy Dock Yard Total number of machines 10

89. 88 We also, noted that the GVWC has no policy on medical claims and / refunds to staff. S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completion Date Responsible FINANCIAL MANAGEMENT 38 The vacant management accountant position should be occupied to affect the budgetary process. The vacant management accountant position is occupied to affect the budgetary process. H The Management Accountant Position is vacant till to the time of the conclusion of our review. The vacant management accountant position to be occupied to affect the budgetary process. • Appointment/redep loyment letter • Staff file March, 2022 Human resources 39 Departmental activity plan are prepared in line with the budget Departmental activity plan in line with the budget prepared. H The Departmental activity plans are not prepared in line with budget. Departmental activity plan in line with the budget to be prepared. • departmental activity plan • Budget March, 2022 Budget Officer 40 The Accounting Policies and Procedure Manual be revised and updated The Accounting Policies and Procedure Manual revised and updated. H The Financial and Accounting Policies and Procedures Manual (final draft July 2007) of Guma Valley Water Company, was out dated and yet still a draft. The Accounting Policies and Procedure Manual to be revised and updated. The accounting policies and procedure manual. March, 2022 Finance Department 41 The financial statements should be audited to ascertain that the actual figures/amounts are stated. Financial statements audited to ascertain that actual figures/amounts are stated. H The actual figures/amounts stated on the Financial Statements were unaudited figures. Financial statements to be audited to ascertain that actual figures/amounts are stated. • Financial statement • Audited report March, 2022 Internal Audit 42 Finance Department should develop a comprehensive assets register. A comprehensive assets register developed by the Finance department. H The team was not provided with a Fixed Asset Register A comprehensive assets register to be developed by the Finance department. Asset register March, 2022 Finance department 43 Management should ensure that all company’s assets are coded to avoid misuse and to distinguish them from private use. Company’s assets coded to avoid misuse and to distinguish them from private use. H Most of the company’s assets procured with the exception of those donated by MCCU were not coded. All Company’s assets to be coded to avoid misuse and to distinguish them from private use. • Asset register • Asset listings March, 2022 Finance Department

87. 86 captured by the billing systems and therefore are not billed. 24 Bills to clients are sent on time and regularly Proportion of bills sent on time and regularly to clients. M Bills to clients are not sent on time and regularly All bills to be sent on time and regularly to clients. • Way bill • Correspondences March, 2022 Finance Department S/N Recommendations Indicator Activity (Input & output) Importance Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Completion Date Responsible Donor Fund/Project Management Millennium Challenge Compact (MCC) 25 The Company should establish an effective project management and monitoring mechanisms for all its projects. An effective project management and monitoring mechanisms for all its projects established. H There were weak project management and monitoring mechanism in place An effective project management and monitoring mechanisms for all its projects to be established. • Monitoring mechanism • Project monitoring reports March, 2022 Permanent Secretary 26 The donor should ensure that funds are provided on time. Proportion of funds provided on time by donors. M There were marked delays in the approval of funds from some of the donors. All funds provided on time by donors. • Transaction • Bank Statement • - Project activity plan March, 2022 Project Manager/Financial department 27 Implementation should be within projects time frame Project implemented on time. M There were also delays in the implementation of projects Project to be implemented on time. Project implementation matrix/Work Breakdown Structure March, 2022 Project Manager 28 All projects should have proper accounting mechanism in place. Projects had proper accounting mechanism in place. H There were challenges in accounting for the projects. Report on project funding and expenses were hard to come by. All projects to have proper accounting mechanism in place. Accounting mechanisms March, 2022 Finance department 29 There should be effective monitoring systems An effective monitoring systems is established. H There were weak monitoring systems of the projects as there are no monitoring reports produced by Guma besides the copy of project update submitted by the contractor. An effective monitoring systems to be established. Monitoring systems March, 2022 Audit/Monitoring and evaluation unit. 30 The ACC should conduct investigations into all projects. Proportion of projects investigated by the ACC. H All projects to be investigated by the ACC Investigation report March, 2022 Permanent Secretary/ACC

90. 89 44 The Internal Auditor should be responsible for the verification of the assets register. Asset register verified by the Internal Audit. The Internal Audit are not verifying the asset register. Asset register to be verified by the Internal Audit. Asset audit report March, 2022 Internal Audit 45 The Accountant should ensure that 5.5% withholding tax deductions from supplier’s payment are payable as prescribed by the law. 5.5% withholding tax deductions from supplier’s payment paid as prescribed by the law. A total of Le 150,000,000 (one hundred and fifty million Leones) for the 2019 financial year had been deducted from suppliers but never paid to the National Revenue Authority (NRA) as prescribed by law. 5.5% withholding tax deductions from supplier’s payment to be paid as prescribed by the law. • Payment voucher • Tax schedule March, 2022 Finance Department 46 PAYE taxes must be paid promptly and Management should ensure mechanisms are put in place to regularize outstanding PAYE. Prompt payment of PAYE taxes ensured and outstanding PAYE taxes regularized. H The team observed the non - payment of PAYE totaling Le 10,478,047,309.46 (ten billion, four hundred and seventy eight million and forty seven thousand three hundred and nine Leones forty six cents) was deducted from staff salary at source as Pay As You Earn Tax (PAYE) but never paid to the regulatory authority. Prompt payment of all PAYE taxes to be ensured and outstanding PAYE taxes regularized. • Tax schedule • NRA receipts March, 2022 Finance Department 47 Management and Anti - Corruption Commission should investigate the Le 10,478,047,309.46 (ten billion, four hundred and seventy eight million and forty seven thousand three hundred and nine Leones forty six cents) deducted but not paid to National Revenue Authority (NRA). The Le 10,478,047,309.46 (ten billion, four hundred and seventy eight million and forty seven thousand three hundred and nine Leones forty six cents) deducted but not paid to National Revenue Authority (NRA) investigated. H The Le 10,478,047,309.46 (ten billion, four hundred and seventy eight million and forty seven thousand three hundred and nine Leones forty six cents) deducted but not paid to National Revenue Authority (NRA) to be investigated. • Investigation report • NRA receipts March, 2022 Management /Anti - Corruption Commission. 48 Payment should be done by Cheque and/or paid directly to the employees’ bank account. Employees paid by cheque and or in their bank accounts. H It was discovered that huge cash was handled and paid over the counter by the Account Clerk to various workers. The payment was made to 200 staff at Regent, Lumley; Wilberforce etc. without bank account details and /or Identification cards. Employees to be paid by cheque and or in their bank accounts. • Cheque stubs • Bank statement March, 2022 Human Resources Department 49 Management should ensure all workers submit bank accounts details for swift accountability. Bank accounts of workers submitted. H Bank accounts of all workers to be submitted. • Staff list • Bank slip • Staff files March, 2022 Human Resources Department 50 The Financial Accountant should ensure that all petty cash requests are approved by the Managing Director before payments were effected. Petty cash requests approved by Managing Director before effecting payment. H it was observed that some petty cash vouchers were not approved by the Petty cash requests to be approved by Managing Director before effecting payment. • Petty cash requests • Petty cash payment March, 2022 Finance Department

6. 5 LIST OF ABBREVIATIONS ACC - Anti - Corrupt ion Commission FDSWSP - Freetown Dry Season Water Supply Project FY - Financial Year GBAA - Government Budgeting and Accountability Act 2005 GoSL - Government of Sierra Leone G VWC - Guma Valley Water Company HRMO - Human Resource Management Organisation Le - Leones MDAs - Ministries, Departments and Agencies MCCU - Millennium Challenge Coordinating Unit MoFED - Ministry of Finance and Economic Development MoWR - Ministry Of Water Resources NP - National Petroleum NRA - National Revenue Authority NWRMA - National Water Resources Management Agency OSR - Own Source Revenue PFM - Public Financial Management Act 2016 RBF - Result Based Financing RM - Records M anagement RT - Review Team SALWACO - Sierra Leone Water Company SLEWRA - Sierra Leone Electricity and Water Regulatory Agency UNDP - United N ation Development Program UNICEF - United Nation International Children Emergency Fund WHT - With Holding Tax

88. 87 31 GVWC/Contractor should have community engagement with the stakeholders of the community to identify land/locations for the kiosks to be erected. GVWC/Contractor had community engagement with the stakeholders of the community to identify land/locations for the kiosks to be erected. M There are strong indications that proper planning and consultation were not done with the communities and as a result the project in some areas lacks vital community support. GVWC/Contractor to have community engagement with the stakeholders of the community to identify land/locations for the kiosks to be erected. Report on community engagement March, 2022 Permanent Secretary 32 The Management of GVWC should work with the Freetown City Council (FCC), Ministry of Lands and Country Planning, and the Ministry of Agriculture and Forestry (MAF) for the Protection and restoration of forests The Management of GVWC should worked with the Freetown City Council (FCC), Ministry of Lands and Country Planning, and the Ministry of Agriculture and Forestry (MAF) for the Protection and restoration of forests. M The Management of GVWC to work with the Freetown City Council (FCC), Ministry of Lands and Country Planning, and the Ministry of Agriculture and Forestry (MAF) for the Protection and restoration of forests • Minute of Water Sector coordination meeting. • Correspondences. March, 2022 Permanent Secretary/Human resources department. 33 NPAA to station Forest Guards in the area to ensure that these activities are put under control. Proportion of areas forest guards are stationed by NPAA to ensuring that GVWC activities are put under control. M Forest guards to be stationed in all areas to ensuring that GVWC activities are put under control. • Areas in which GVWC activities are undertaken • Forest guards deployment file • - Forest guards reports. March, 2022 Permanent Secretary/Human resources department. 34 A clear formula/metric should be used to assess work done with milestones set for various activities A clear formula/metric used to assess work done with milestones set for various activities. H A clear formula/metric to be used to assess work done with milestones set for various activities. Formula/matrix used March, 2022 Permanent Secretary S/N Recommendations Indicator Activity (Input & output) Importa nce Baseline situation/ Challenges/Findings ACC’S Target Means of verification (MOVs) Complet ion Date Responsible BUDGET EXECUTION 35 Management should ensure a policy be initiated for medical so as to avoid misuse/ abuse. The initiation of a policy for medical, so as to avoid misuse/abuse ensured. M an unfavorable balance of Le 1,096,000 (one million and ninety six thousand Leones) from medical claims, which is about 0.44% excess. Some of the medical claims inspected by the team had no signature from the Medical Doctor at PDW to confirm the validity of the claims. The initiation of a policy for medical, so as to avoid misuse/abuse to be ensured. Policy document. March, 2022 Permanent Secretary 36 Alternatively. Management should look into the possibility of allocating an annual fund as medical for staff which should be included in their monthly salary as medical allowance. Annual fund for staff medical included in their monthly salary as medical allowance looked into. M Annual fund for staff medical included in their monthly salary as medical allowance to be looked into. • Concept note • Salary voucher March, 2022 Permanent Secretary 37 Management can also have a medical insurance scheme for staff to cover technical staff who worked in risk prone areas. Medical insurance scheme for staff to cover technical staff who worked in risk prone areas established. M Medical insurance scheme for staff to cover technical staff who worked in risk prone areas to be established. Medical insurance scheme March, 2022 Human Resources Department