The procedures involved are as follows:

• Establish a Board of Survey
  The authority to dispose of is vested in a Board of Survey. Head of procurement entity shall convene a board of survey comprising representative of the departments with vehicle, unserviceable, obsolete or surplus stores, plant and equipment which shall report on the items and subject to a technical report from them, recommend the best method of disposal after the officer in charge has completed the board of survey form.
• Approval of Board of Survey’s recommendation
  The board of survey’s recommendation shall be approved by the head of procurement entity and the items shall be disposed of as approved. Note that for items that become unserviceable for reasons other than wear and tear, disposal guidelines issues by the Board of procurement authority. However in the case of the vehicles, they become unserviceable due to wear and tear so this rule does not apply.
• Procedures for disposal
  Procedure should be carried out based on the recommendations of the Board of Survey. The procedures approved under the Procurement Act 2016 include:
  ** Transfer to government department or other public institution with or without financial adjustment.
  When this procedure is recommended by the BOS, the entity will enter into agreement with another public sector entity to transfer the vehicle to them for a charge or no charge to the receiving entity. However, in the case in question, this method may not be appropriate since the vehicle is completely out of service and giving it to another entity may cause a financial burden to public purse.
  ** Sale by public tender to the highest bidder, subject to reserve price
  When this option is recommended, the entity has to arrange for a public tender and invite tenders for the sale of the vehicle. Under sale by public tender the services of auctioneer is not required.
  ** Sale by public auction, subject to reserve price
  Here a professional Auctioneer in good standing should be appointed by the entity to carry out the disposal on its behalf.
  ** Destruction, dumping or burying as appropriate. Only appropriate when the vehicle has no use at all.

                                                   Name of Hospital
                                                            Memo

.              Subject:      Procurement of X-Ray Component
As we have discussed at the just ended management meeting concerning the above subject matter, I wish to provide you with some information to support our use of single source procurement for the X-Ray equipment, despite your strong reservation for it at the meeting.

I agree that the use of single source procurement raises questions because it is a high-risk method of procurement. However, the Public Procurement Act 2016 (Amendment), Act 914 has permitted the use of single source procurement under certain exceptional circumstances. Under the law single source procurement is allowed when:
i) Goods or services are only available from a single supplier or the supplier has exclusive right.
ii) Urgent need for the GWS not caused by dilatory conduct of the procurement entity, making it impracticable to use competitive methods
iii) Occurrence of catastrophic even making the use of competitive method impracticable.
iv) Contract for research, experiment, study or development not for commercial purpose.
v) Procurement has implications for National security
vi) Where additional supplies need to be procured from a supplier who had made supply in the immediate to ensure standardization and compatibility with existing goods or equipment.

Our use of single source procurement for the procurement of the X-Ray component is justifiable on the ground of circumstance (i) and (ii) above. All that we have to do is to apply to the public procurement authority for approval.
Kindly consider this fact.

Thank you
Johnson

.                                                                                             2018                    2017
Gross Debt (interest bearing liabilities) GH¢’m            128,640              114,400

.                                                                                                                    2018                    2017

Net Debt percentage (Financial Asset -Gross Debt) GH¢’m             -114,290              -98,520

.                                                                                              2018                    2017

Domestic Debt per Capita (Debt/Pop*) GH¢                5145.60                 4786.6

.                                                                                           2018                    2017

Debt to GDP (Debt/GDP*100) %                                    62.72                   61.64

.                                                                                               2018                    2017

Total Asset to debt (Total Asset/debt *100) %                 16.71                   21.04

.                                                                                                 2018                    2017

Capital Asset per Capita (Capital asset/pop) GH¢            568.00                 736.00

Report of the Financial Position of the Consolidated Fund for 2018 financial year.
Introduction
The financial position of the Consolidated Fund has been analysed using some ration and other indicators. The report examines the financial condition of government based on the assets and liabilities disclosed in the financial reports.

Discussions and Analysis
Gross debt measures the total interest-bearing liabilities of the Consolidated Fund. The result shows an increase in total debt of government from GH¢114.4 billion in 2017 to GH¢128.64 billion in 2018, a percentage increase of 12.45%. This gives a bad signal for the financial position of the government as this will negatively affect financial performance of subsequent years in the form of high interest expenses. The debt sustainability of the country is threatened by a high debt to GDP ratio which is in the increase from 61.64% in 2017 to 62.72% in 2018. Domestic debt per capita also increase from GH¢4786.60 in 2017 to GH¢5145.60 in 2018 showing increasing debt burden of each citizen. Thus, the debt position of the Consolidated Fund is not encouraging and it has serious consequences for sustainability and future service delivery.

The use to which the debt is put is very important. The ratios included that the debt might have been used for current purposes and repayment of matured debt. The net debt position is unfavourable deepening from GH¢98.5 billion in 2017to 114.3 billion in 2018. This shows that debt stock of the Consolidated Fund is not backed by adequate financial assets and this increase the countries risk exposure. The amount of debt used in the acquisition of capital infrastructure is insignificant. The result shows that only 21% of debts reflects in capital infrastructure in 2017 but drop further to only 16% in 2018. This shows that the debt is being used for recurrent spending and debt pay offs. This trend is disturbing more when the capital asset per capital is very low. The negligible amount of GH¢736.4 share of capital assets by individual citizen in 2017 further drop to GH¢568 in 2018.

Conclusion
It is observed that the financial condition of the Consolidated Fund is precarious and a drastic measures and reforms are required to reverse the trend. Effective debt management policies are needed to reverse the situation. The use of debt for financing recurrent expenditures should be avoided as much as possible.

Value for Money is concerned with obtaining the best possible combination of services from the least resources. It is thus, the pursuit of economy, efficiency and effectiveness.
Below are the mechanisms used to achieve value for money.

• Economy
  Economy is the term and condition under which an organization acquires human and material resources of the appropriate quality and standard at the lowest cost. From this procurement will be a purchasing activity whose purpose is to give the purchaser best value for money and that for complex purchases, value may imply more than just price since quality issues also need to be addressed.
• Efficiency
  Efficiency as the relationship between goods and services produced and resources used to produce them. An efficient operation produces the maximum output for any given set of resource inputs; or, it has a minimum input for any given quantity and quality of services provided In addition, efficiency implies practicality, especially in terms of compatibility with the government’s administrative resources and professionalism.
• Transparency & Accountability (Ethical Standards)
  Good procurement holds its practitioners responsible for enforcing and obeying the rules. It makes them subject to challenge and to sanction, if appropriate, for neglecting or bending those rules. Accountability is at once a key inducement to individual and institutional probity, a key deterrent to collusion and corruption, and a key pre-requisite for procurement credibility.
• Accountability and fairness in public procurement
  Accountability and fairness are three cardinal pillars that procurement reforms seek to achieve in that a very fair and accountable procurement system helps in the efficient utilization of the state resources judiciously. Procurement practitioners need to be very fair in their day-to-day dealings with their suppliers and potential bidders and the public at large in order to earn the trust of the various actors within the procurement system. Accountability refers to the process of holding an individual or an organization fully responsible for actions and functions they are engaged in and over which they have authority to exercise those functions.
• Competition
  Competition has been regarded as one of the most important factors in attaining value for money in Public sector. This is on the premise that competition amongst bidders can lead to improvements in pricing and alternative means of delivering VFM. Competition can either be for the market (i.e. in the bidding process) or competition/ contestability in the market which occurs after the contract is concluded and is in operation. On the contrary, the absence of competition or potential entry would lead to difficulties in attaining higher efficiency and value for money.
  **NB: The emphasis of the question is not on elements of value for money (economy, efficiency, effectiveness and equity) but ways by which value for money could be attained.

When management is formulating accounting policy the guiding principle is that the policy should results in information that is:

• Relevant to the decision-making needs of users.
• Reliable, in that the financial statements:
  ** Represent faithfully the financial position, financial performance, and cash flows of the entity
  ** Reflect the economic substance of transactions, other events and conditions, and not merely the legal form
  ** Are neutral, i.e., free from bias
  ** Are prudent
  ** Are complete in all material aspects
  ** Consistent

IPSAS 3 insists on ensuring consistency of accounting policy. However, a change in accounting policy may occur under two accepted conditions:

• When the change is required by an IPSAS, or
• When the change is made by management on the grounds that it results in reliable and more relevant information.
  

• If a change in accounting policy is required by an IPSAS, follow that pronouncement’s transition requirements.
• If none is specified, or if the change is voluntary, apply the new accounting policy retrospectively by restating prior periods.
• If restatement is impracticable, include the cumulative effect of the change in net assets/equity.
• If the cumulative effect cannot be determined, apply the new policy prospectively.
  

According to the Conceptual Framework, the objective of measurement is to select those measurement bases that most fairly reflect the cost of services, operational capacity and financial capacity of the entity in a manner that is useful in holding the entity to account and for decision-making purposes.

This implies that the choice of measurement basis should ensure that the basis provides useful information that enables the users to assess the cost of services provided, the operational capacity of the entity and the capacity of the entity to fund its activities.

The selection of the measurement bases is guided by the extent to which the basis fairly reflects information on the cost of service, operational capacity and financial capacity of the entity.

• Human resource software package developed by the entity.
  This is an intangible asset developed by the entity. The most appropriate measurement basis is historical cost since the cost of developing the software package can be determined reliably. Historical cost is the consideration given to acquire or develop an asset, which is the cash or cash equivalents or the value of the other consideration given, at the time of its acquisition or development. In the instant case, historical cost is most appropriate measurement basis because it fairly reflects the:
  ** Cost of service through the amount of the resources expended to acquire or develop assets consumed in the provision of services.
  ** Operational capacity through information on the resources available to provide services in future periods based on their acquisition cost.
  ** Financial capacity by providing information on the amount of assets that may be used as effective security against borrowing.
• Stock books in the library
  For this asset, current value measurement basis is most appropriate to reflect the economic environment prevailing at the reporting date. Specifically, replacement cost is the measurement basis that fairly reflect the cost of service, operational capacity and financial capacity of the library books. Replacement cost is the most economic cost required for the entity to replace the service potential of an asset at the reporting date. The use of replacement cost the stock of the library books provides information that fairly reflects the:
  ** Cost of service to be equivalent to the amount of sacrifice of service potential incurred by that use.
  ** Operational capacity by the resources available to provide services in future periods, a sit focused on the current value of the assets and its service potential to the entity.
  Note that financial capacity is note reflected by replacement cost basis as it does not provide information on the amounts that would be received on sale of asset.
• Vehicle donated to the entity
  Since the vehicle was donated to the entity, it lacks purchase cost. The appropriate measurement basis is the market value. Market value is the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction. Vehicle is traded in the open, active and orderly markets so obtaining the market value is practicable. Market value of the vehicle fairly reflect the:
  ** Cost of service by allocating the cost of assets to reflect their consumption in the current reporting period based on current market values of the vehicles.
  ** Operational capacity by providing information on the market value of assets held to provide services in the future periods.
  ** Financial capacity by providing information on the amount that would be received on the sale of the assets.

Accounting policy relating to Land and Building covers cost measurement and recognitions and depreciation policies.
Cost Measurement and Recognition

• Initial recognition of land and building is at historical cost. Subsequent recognition is on carrying amount or revaluation.
• All acquisitions of land and building as well as improvements will be capitalized when the criteria of recognition in accordance with the IPSAS are met.
• Land and building should be derecognized when potential benefits cannot be expected to from to the entity.

Depreciation/impairment

• The depreciable/amortization amount of building be allocated over its useful life in accordance with the depreciation method.
• It is assumed that the residual value for all assets will be zero.
• The calculation of depreciation/amortization will stop where an asset is disposed of, held for sale or is fully depreciated.
• Impairment of building should be written off.
• The calculations of depreciation will commence in the year the asset is put to use for its intended purpose.
• Impairment loss shall be recognized immediately in the Covered Entity’s income statement, unless the asset is carried at a revalued amount.
• Where the impairment loss relates to a revalued asset, the impairment is firstly offset against its revaluation reserve balance. Any remaining impairment loss shall be recognized immediately in Covered Entity’s Income Statement.
• After recognizing the impairment loss, the depreciation charge shall be adjusted by taking into account the revised carrying amount, residual value and remaining useful life.

Accounting policy for inventory is as follows.
Measurement

• Inventory for sale shall be recognized at lower of cost and net realisable value.
• Inventory not for sale shall be recognized at lower of cost and current replacement cost.
• Inventory acquired through non-exchange transaction should be measured at fair value at the date of acquisition.

Recognition

• Inventory sold, exchanged or distributed shall be recognized as expense at carrying amount in the period in which the revenue relates, exchange or distribution is made.
• Write offs in inventory should be recognized as expense in the period it relates.
  

Notes to the financial statements provides more information that contained on the face of the financial statement and this enhances the understandability of the financial statements.

Notes to the accounts provides information on:

• Accounting policies applied to the preparation of the financial statement.
  Under the accounting policy, the preparer provides information on the accounting policies that have been applied in the preparation and presentation of the financial statements. Accounting policies usually covers the basis of accounting, recognition and measurement, depreciation, foreign exchange transaction etc. In the section, a statement of compliance to standards and legislations are made. For example, a statement indicating the financial statements are prepared in compliance with IPSAS.
• Extracts or schedules
  These notes provide the details of amounts shown on the face of the financial statement. It provides a disaggregated information on values disclosed on the face of the financial statement.
• Additional explanations
  These notes provided further information about events and transactions that are not captured on the face of the financial information but provides relevant information on the sustainability of service potential of the entity. Under the cash basis, information that are reported on other basis but cannot be shown on the face of the financial statement are reported in the notes to the financial information.

There are many types of PPP arrangements available, however in this instance the power company is already in operation and government want PPP to improve their operations. In this case all arrangements that required building and design of private sector will not be appropriate. Corporatization will also not be appropriate because it had been used in the past and did not work out well, as per the case. Therefore, government is left with these options, including:

• Operate and maintain/maintain and operates arrangement
  Under this arrangement, the government contract the private firm (operator) to take over the management of public asset, operate it and maintain it from the revenues generated from its operations. The operator is not required under the contract to make any investment into the operations of the entity expert for their expertise. The operator enjoys fees as a reward without any right over the residual asset.

Implication for public monies:
Under this arrangement, government is expected to use its resources to construct or acquire the assets thereby involves huge outlay from the public funds. It will therefore not be appropriate where there are inadequate public funds for the project.
Implication for Management:
The management is carried out solely by the operator and this enables government to leverage on management expertise of the private operator to enhance delivery of public service.
Implication for Residual asset:
The residual asset remains that of government and the ownership right of the government is unaffected by this arrangement. The residual risk is a major constrain of this arrangement.

• Service concession
  Service concession arrangements involve contracts under which a public sector entity (“grantor”) grants a private entity (“operator”) the right to operate the grantor’s infrastructure (e.g., an airport, toll road, bridge, hospital, power distribution). The infrastructure may already exist or may be constructed by the operator. The concession arrangement may also require significant upgrades to the infrastructure without any equity right to operate. The operator is allowed to recoup its investment over a specified contract period and return the residual asset to the grantor (government).

Implication for public monies:
The government cease to pump public monies into the power distribution company from the commencement of the agreement. Operator is required under contract to make the necessary investment into the company to upgrade its distribution capacity. Thus is alleviate pressure from the public funds as the private operator take over the investment.
Implication for management:
Management of the power distributor is ceded to the private operator who brings its expertise on board to enhance power distribution. Government is therefore relief of the burden of managing the entity for the contract period.
Implication for residual asset:
The ownership of the power distributor remains government from the commencement of the contract to the end of the contract. The residual asset is therefore transferred to the government at the end of the contract. There is high residual risk in this arrangement.

• Divestiture/ partial transfer
  This involves partial transfer of part of the ownership of the power distributor to the private operator, who then becomes a shareholder of the company. In most of these cases, government gives majority control to the private operator and then maintains the minority interest of say 40-49%.

Implication for public monies:
At the commencement, the proceeds from the sale boost the public funds but subsequent investment may be required from government as a shareholder.
Implication for management:
The private operator has controlling interest in the company and takes major decisions of the company. Government as a non-controlling interest has the opportunity to influence the decision of the board to protect public interest.
Implication for Residual Asset:
The asset becomes a joint asset of both government and the operator and in case of liquidation, the residual assets will be distributed based on the shareholdings. Residual risk is fairly shared in this arrangement.

Composition of the Audit Committee.
The Audit Committee is made of five members as follows:

• Three of the members nominated by the Institute of Chartered Accountants, Ghana and the Internal Audit Agency. These members should be independent of the operation of the covered entity.
• Two members nominated by the Principal Account Holder of the covered entity. These should exclude Principal Account Holder, Deputy Minister and the Principal Spending Officers.
• Chairman of the committee shall be selected among the three independent members. The Principal Spending Officer or Principal Account Holder in consultation with the Audit Committee shall appoint a person to provide secretariat support to the committee.
• The Principal Account Holder shall appoint all the members and the Chairman.

How the structure of the committee could enhance the effectiveness of the committee.
The structure of Audit Committee may improve effectiveness in the following ways:

• Independent of majority of members, including Chairman will enhance the work of the committee by minimizing opportunity of influence and likely victimization of out spoken members. This affords the committee free hands to operate.
• Finance expertise on the Committee is also enhanced as majority of members are from accounting, finance and audit backgrounds. This enhances individual effectiveness on the Committee.

Statutory responsibilities

• The Audit Committee shall ensure that the head of a covered entity pursues the implementation of recommendation(s) contained in internal audit reports, Parliament’s decisions on the Auditor-General’s report, Auditor-General’s Management Letter, and report of an internal monitoring unit in the covered entity particularly, in relation to financial matters raised.
• The Audit Committee shall ensure that the head of a covered prepares an annual statement showing the status of implementation of recommendations contained in internal audit reports, Parliament’s decisions on the Auditor-General’s report, Auditor-General’s Management letter, report of internal monitoring unit in the covered entity particularly, in relation to financial matters raised; and any other related directives of Parliament.

Advisory role and responsibilities

• Providing advice on sound, transparent and reliable financial management practices,
• Ensuring the risk management process is comprehensive and effective.
• Helping achieve organization-wide strong and effective internal controls in the covered entity.
• Reviewing corporate policies relating to compliance with laws and regulations, ethics, conflicts of interest, and investigations of misconduct and fraud.
• Reviewing current and pending corporate governance related litigation or regulatory proceedings to which the covered entity is a party.
• Ensuring the internal auditors’ access to the Audit Committee, encouraging communication beyond scheduled Committee meetings.
• Reviewing internal audit plans, internal audit charters, risk (including fiscal risk) assessment reports.
• Ensuring the development, approval and update of the code of conduct. The Committee should also ensure that all employees receive the code of conduct, understand it, and obtain appropriate training regarding it.
• Follow up on significant issues, investigations, and disciplinary actions.
• Collaborating with the Internal Audit Agency to initiate investigation into matters involving fraud or misuse of public funds by the Principal Spending Officer.
• Reviewing audit reports for assurance on efficiency, effectiveness and economy in the administration of programmes and operations of the covered entity.

• Offering training for members to equip them with the current knowledge on the working of Audit Committee. This will enhance members’ effectiveness.
• Regular review and monitoring of the Audit Committee should be carried out by the ICAG and Internal Audit Agency. This will ensure assessment of the Audit Committee and those not performing will be worked upon.
• Collaboration with other institutions of accountability such as the Public Accounts Committee and Auditor General to promote effective financial governance.