GWI forensic audit
The Forensic Audit into the Guyana Water Incorporated (GWI) has revealed that there is some $89 million in advances that are still outstanding and the company has made no efforts to recover these over the years.
The Audit conducted by Chartered Accountants Ram and McRae found that as at December 31, 2015, two advances were paid to the tune of $89,324,312 for supply of materials, but those supplies were not forthcoming.
“C&N Trading Company Limited was advanced on August 31, 2011 $8,775,000 for the supply of transformers, which were never supplied. GWI took the company to Court and obtained judgment in its favour. The execution of the judgment could not have been done and the money is still to be recovered,” the auditors highlighted.
The second occasion cited was where Lynwill International Trading Ltd was advanced in December 2011 $4,930,681 for the supply of chlorine gas, which was never supplied. The matter is before the Court.
“These are clear evidences that proper due diligence was not done before funds were advanced to companies that could not or were never in a position to deliver the goods,” the auditors opined.
They said that based on the fact that judgment had been awarded in favour of GWI and the first advance could not be recovered, it is also likely that the other advance may not be recovered after four years.
The auditors said they have investigated other advances, including “Staff Advances for Site Visits” and noted that the company’s policies on advances were not followed and are still not being followed.
Breaches by CEO
Meanwhile, turning their attention to the actions of the former Chief Executive Officer (CEO) of GWI, Shaik Baksh, the auditors accused him of overstepping his authority.
The auditors stated that the CEO was misusing his position while at the helm of the utility.
“It appears that the CEO used his position to override policies and procedures and overstepped his authority with or without the approval of the BoD (Board of Directors),” the report stated.
It pointed to one occasion when Baksh unilaterally decided to take control of a vehicle PPP 9050, purchased for use by the Project Manager Georgetown Sanitation Programme and decided to use it for his personal purpose without the consent of the board.
In May 2015, Baksh’s son crashed and wrote off the said vehicle while driving along the Soesdyke/Linden Highway. At the time the GWI CEO was out of the country.
The report also cited Baksh for taking advances for trips that did not materialize, claims for medical expenses despite not being entitled to same based on his contract, as well as collecting a monthly rent to live in his own house located at Lot 16 Ixora Avenue, Eccles, East Bank Demerara
Baksh also received $120,000 per month that included electricity; entertainment allowance of $70,000, and a duty allowance of $30,000.
The auditors recommended that the newly-appointed GWI Board of Directors review Baksh’s contract to determine whether benefits paid were consistent with his contract of employment and if there are overpayments, these should be pursued and recovered.
The audit examined a number of other areas, including non-revenue water, company assets, tariff increases as well as award of contracts