Audit reveals ECG's non-adherence to Cash Waterfall Mechanism

An audit report conducted by PricewaterhouseCoopers (PwC) has highlighted significant discrepancies in the Electricity Company of Ghana's (ECG) adherence to the Cash Waterfall Mechanism (CWM), prompting concerns over transparency and accountability.

According to The Herald, the audit, spanning from July 2022 to September 2023, reveals a staggering GHS3.5 billion disparity between reported collections and actual disbursements by ECG, a revelation

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Notably, the report points out a lack of cooperation from ECG's management during the audit process, exacerbating concerns about transparency and accountability.

Furthermore, the audit underscores ECG's non-compliance with the Ministry of Finance's directive on operating a single account for all collections and payments, as evidenced by payments to CWM beneficiaries from other operational accounts.

In response to these findings, the audit recommends urgent reforms, including process improvements in billing and invoicing and the adoption of technology-enabled platforms to enhance transparency and accountability.

The report emphasizes the importance of stakeholder collaboration in implementing these reforms and restoring confidence in the integrity of the CWM.

Additionally, it calls for a reconsideration of using Microsoft Excel-based spreadsheets for the CWM, proposing enhanced data security measures to safeguard the integrity of the mechanism.

Overall, the audit underscores the need for comprehensive reforms to address the systemic challenges within ECG and ensure the effective functioning of the CWM to promote financial sustainability in Ghana's energy sector.