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Tuesday, July 16, 2024

Auditors lament inconsistencies in SSHFC admin’s corporate income tax, others

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By Juldeh Njie

Auditors from DT Associates, a private independent auditing firm, lamented inconsistencies in the administration of the Corporation’s taxes, particularly on Corporate Income Tax.
They made these findings during their test of the corporation’s compliance status on Tax and other statutory obligations.

Presenting their observations for the year ended 31st December 2016 on tax issues before the Public Enterprise Committee, Aji Penda Sankareh, auditor, DTA Associates, said over the past three years the Corporation has been making quarterly payments to the Gambia Revenue Authority (GRA) referred to as Royalties computed as 1.5% of each Fund’s Quarterly Gross Turnover and remitted to GRA before the due date for filing of CIT Advance payments.

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She said: “Justification for the Royalty payment was not provided for the Income and Value Added Tax Act 2012 or the SSHFC Act 2015. Neither was there documentary evidence in the form of an agreement between government, GRA and SSHFC.”
She said for the period under review, a total of D9.9m was paid to the revenue authority with an outstanding balance of 4.6m as at year end for all the funds, both of which could not be justified with adequate supporting documents.

“The implications for the payment of royalties to GRA without adequate supporting documents is quite an exposure in terms of liquidity, effective control and monitoring of financial transactions and above all Fund Management.”
She said with all the inconsistencies mentioned, the management should engage the revenue authority for a discontinuity on the payment of Income Tax.
“The corporation should consider obtaining a written representation from the Revenue Authority should any other decision be reached different from the above to serve as reference for any future queries,” she concluded.

In response, Abdoulie Cham, director of finance and investment, said they have noted the observation and recommendations made by the auditors.
“We are pleased to inform you that the Corporation engaged GRA and we were able to obtain a formal exemption from all royalties’ tax payments.”
Meanwhile, their findings also revealed inconsistencies in the construction of housing units and infrastructure in the Kanilai housing project.

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“We were informed that the project was financed on behalf of Government of the Gambia, however, we were not provided with documentary evidence confirming the legality of the arrangement or legal ownership of the project,” she revealed.

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