LEITI Commences Reconciliation of Unresolved Discrepancies in 1st Report
The Liberia Extractive Industries Transparency Initiative (LEITI) has begun work to investigate and reconcile unresolved discrepancies contained in its first EITI Report published early 2009. According to agreed schedule, the investigation and reconciliation of the unresolved discrepancies will be completed by the end of February 2010, and the Final Report thereof published early march 2010.
The investigation and reconciliation will be carried out on behalf of LEITI by MGI-Monbo & Co, a consortium comprising of Midsnell Group International (MGI) which is an international auditing firm with presence in over eighty (80) countries and the Liberian firm of Monbo & Co which has over thirty years of experience in auditing for national and international clients. MGI-Monbo and Company was selected through a competitive recruitment process overseen and approved by the LEITI MSG.
The first LEITI Report covered the period July 1, 2007 up to and including June 30, 2008, and contained payments data supplied by thirty (30) companies and revenues data supplied by four (4) agencies of Government. A total amount of US$29,454,662.00 was reported by the thirty companies as combined payment of taxes, royalties, land/surface rental and other administrative fees, while the four agencies of the Government reported total receipts of US$29,447,3390, thus yielding a combined discrepancy of US$7,323.00, which was the excess of reported receipts over reported payments.
While the overall net discrepancy of US$7,323.00 was 0.02% of the reported total receipts and therefore clearly negligible, there were significant discrepancies in respect of reported payments and receipts concerning individual tax kinds. There were nineteen (19) companies and two (2) agencies of Government that had discrepancies in their report. It was discovered that one of the unresolved discrepancies (involving the amount of US$104,288.00 reported as paid by Amlib United Minerals (Amlib) but which the Government denied receiving) was the result of fraud and that the Government of Liberia indeed never received the funds. Some dishonest personnel of Amlib misapplied the funds and subsequently fabricated receipt to support their false claim of payment.
The cause of the discrepancy concerning the Amlib’s reported payment highlighted the need to investigate each unresolved discrepancy with the view of not only resolving the discrepancy, but also avoiding its recurrence. While an internal investigation of the discrepancies was conducted and concluded, the LEITI MSG agreed that the investigation and resolution of the discrepancies be done by a competent and reputable independent firm in order to provide needed assurance and credibility.
Meanwhile, the 2nd EITI Report of Liberia for the fiscal year July 1, 2008 to June 30, 2009 is expected to be published shortly. Preparation of the Report has been completed by the independent Reconcilers, Moore Stephens LLP who has also submitted the Draft Report for the approval of the LEITI MSG. The LEITI MSG discussed the draft Report in a meeting held on January 21, 2010. A second meeting to discuss and hopefully approve the 2nd EITI Report of Liberia is scheduled for Thursday, February 4, 2010. Approval of the Report will be followed by immediate publication and massive dissemination.
The Liberia Extractive Industries Transparency Initiative (LEITI) is a partnership involving the Government, the Private Sector and the Civil Society of Liberia, which is supported by Liberia’s Development partners. The LEITI seeks to ensure transparency over payments to, and revenues received by, the Government of Liberia in connection with the operations of all oil, mining, logging and Agriculture companies operating in Liberia. The work of the LEITI consists of regular disclosure, audit/reconciliation, and publication of both (1) all material payments made by oil, mining and logging companies (“Companies”) to the Government, and (2) all material revenues received by the Government from the above-mentioned companies. Liberia is the first country in the world to include agriculture and forestry in its EITI program.
The investigation and reconciliation will be carried out on behalf of LEITI by MGI-Monbo & Co, a consortium comprising of Midsnell Group International (MGI) which is an international auditing firm with presence in over eighty (80) countries and the Liberian firm of Monbo & Co which has over thirty years of experience in auditing for national and international clients. MGI-Monbo and Company was selected through a competitive recruitment process overseen and approved by the LEITI MSG.
The first LEITI Report covered the period July 1, 2007 up to and including June 30, 2008, and contained payments data supplied by thirty (30) companies and revenues data supplied by four (4) agencies of Government. A total amount of US$29,454,662.00 was reported by the thirty companies as combined payment of taxes, royalties, land/surface rental and other administrative fees, while the four agencies of the Government reported total receipts of US$29,447,3390, thus yielding a combined discrepancy of US$7,323.00, which was the excess of reported receipts over reported payments.
While the overall net discrepancy of US$7,323.00 was 0.02% of the reported total receipts and therefore clearly negligible, there were significant discrepancies in respect of reported payments and receipts concerning individual tax kinds. There were nineteen (19) companies and two (2) agencies of Government that had discrepancies in their report. It was discovered that one of the unresolved discrepancies (involving the amount of US$104,288.00 reported as paid by Amlib United Minerals (Amlib) but which the Government denied receiving) was the result of fraud and that the Government of Liberia indeed never received the funds. Some dishonest personnel of Amlib misapplied the funds and subsequently fabricated receipt to support their false claim of payment.
The cause of the discrepancy concerning the Amlib’s reported payment highlighted the need to investigate each unresolved discrepancy with the view of not only resolving the discrepancy, but also avoiding its recurrence. While an internal investigation of the discrepancies was conducted and concluded, the LEITI MSG agreed that the investigation and resolution of the discrepancies be done by a competent and reputable independent firm in order to provide needed assurance and credibility.
Meanwhile, the 2nd EITI Report of Liberia for the fiscal year July 1, 2008 to June 30, 2009 is expected to be published shortly. Preparation of the Report has been completed by the independent Reconcilers, Moore Stephens LLP who has also submitted the Draft Report for the approval of the LEITI MSG. The LEITI MSG discussed the draft Report in a meeting held on January 21, 2010. A second meeting to discuss and hopefully approve the 2nd EITI Report of Liberia is scheduled for Thursday, February 4, 2010. Approval of the Report will be followed by immediate publication and massive dissemination.
The Liberia Extractive Industries Transparency Initiative (LEITI) is a partnership involving the Government, the Private Sector and the Civil Society of Liberia, which is supported by Liberia’s Development partners. The LEITI seeks to ensure transparency over payments to, and revenues received by, the Government of Liberia in connection with the operations of all oil, mining, logging and Agriculture companies operating in Liberia. The work of the LEITI consists of regular disclosure, audit/reconciliation, and publication of both (1) all material payments made by oil, mining and logging companies (“Companies”) to the Government, and (2) all material revenues received by the Government from the above-mentioned companies. Liberia is the first country in the world to include agriculture and forestry in its EITI program.