The General Auditing Commission (GAC) has unearthed a disturbing pattern of financial mismanagement, waste, and possible fraud at the Liberia Petroleum Refining Company (LPRC), shedding light on how tens of millions in public funds may have been misused or gone unaccounted for over a four-year period.
The GAC Audit Report covers the fiscal years from July 1, 2017, to June 30, 2021.
The GAC Audit Report presents a damning snapshot of LPRC’s internal financial controls, or lack thereof.
The findings point to systemic issues, ranging from overspending without approval to loss of public funds through undocumented expenditures and significant variances in accounting records.
The Biggest Question: US$835K Spent Without Board Approval?
Among the most concerning findings is that LPRC’s management expended over US$835,838 beyond its approved budget without any documentation of supplementary budget approval by its Board of Directors.
This violates basic principles of public sector financial accountability and raises red flags about unchecked spending practices at the entity.
US$302K in Payments without Any Description:
The audit also flagged US$302,465 in payments made using vouchers that completely lacked any narrative or justification. In some cases, the vouchers didn’t even state what the money was spent on.
According to the GAC, the absence of even the most minimal documentation not only undermines transparency but also opens the door for fraud and misappropriation.
Missing Supporting Documents for Expenditures.
In another troubling observation, the GAC noted that US$16,373.90 was disbursed without any accompanying receipts, invoices, or delivery notes. These missing documents are crucial for verifying that goods or services were actually received in exchange for the payments.
“In the absence of adequate supporting documents, the validity, occurrence, and accuracy of payments may not be assured,” the GAC warned, highlighting the risk of outright fraud or inflated expenses.
Half a Million Dollar Variance in Financial Records:
The GAC found a staggering US$509,526.97 discrepancy between LPRC’s trial balance and its financial statements for the fiscal year ending June 30, 2018. Such a gap suggests either severe incompetence or intentional manipulation of financial data.
US$19.5 Million in Losses Unverified:
Perhaps most alarming is the reported US$19,531,927 in unexplained losses-described vaguely as losses on fixed asset disposals, miscellaneous losses, and missing petroleum products.
LPRC failed to provide any supporting documents to substantiate these claims.
The largest single item: an US$18.6 million write-off due to missing products in 2020/2021. No documentation was provided to show how such a vast quantity of inventory simply disappeared.
Social Security and Tax Obligations Ignored:
Beyond internal mismanagement, LPRC also failed in its obligations to national institutions.
The audit reveals that a total of US$267,145 in employee and employer Social Security Contributions was not remitted to the National Social Security and Welfare Corporation (NASSCORP).
Moreover, US$2,977,884 reported as Corporate Income Tax Payable in 2020/2021 could not be verified as remitted to the Liberia Revenue Authority (LRA), raising concerns of potential tax evasion.
Pattern of Irregularities: Negligence or Design?
This audit paints a picture of an institution that either lacks the capacity or the will to manage public resources responsibly.
While some discrepancies may stem from weak internal systems, the repeated nature of these findings over multiple years suggests a deeper issue, possibly systemic corruption.
GAC Recommendations and Public Accountability:
The GAC has issued several recommendations: including that LPRC management must account for all undocumented expenditures, reconcile variances, and ensure compliance with public financial management laws.
But the question remains: Will accountability follow?
In a country where audit reports too often gather dust, civil society and anti-graft advocates are calling for swift action-including potential criminal investigations and prosecution of those found culpable.
A Litmus Test for the Boakai-Koung Administration
With a new administration in office following the 2023 elections, the response to this report will serve as a litmus test for the government’s commitment to fighting corruption and enforcing transparency.
As watchdogs and ordinary Liberians await further action, the GAC’s findings serve as a stark reminder of how critical it is to strengthen oversight in state-owned enterprises-and to ensure that public resources serve the people, not private interests.
