…former CEO operated without oversight of Board of Directors

POOR governance, mismanagement and the absence of a strategic plan, as well as Standard Operating Procedures (SOPs) for the different departments were a few of the glaring discrepancies which auditing firm Nigel Hinds Financial Services uncovered at the Guyana Office for Investment (Go-Invest).As such, the auditing firm has recommended that the Board of Directors of the entity be free of political interference and represent the balanced, best interests of the shareholders as a whole, rather than special interest groups or constituencies. In addition, the creation of the position of deputy director was strongly recommended against the backdrop that it would ensure that in the absence of the Chief Executive Officer (CEO), confusion would be diffused regarding who will act in his/her absence.
The audit report, dated September 30, 2016 and addressed to Minister within the Ministry of Finance, Jaipaul Sharma, stated that Go-Invest operates without a documented governance structure.
According to the report, the practice allowed for “ad-hoc decision-making “ and this resulted in serious deficiencies in how the agency was managed at both the Board of Directors and executive levels for the period under review.
The auditors noted that during the period of the assessment, Go-Invest did not operate with a Governance code which allows for strategic management of the entity.
The firm stated that investigations revealed that there is no documented evidence of board meetings being held in 2012. In 2013, two such meetings were held, and one was held in 2014. No meetings were held in 2015 prior to July 2015. “As a result, the CEO was invariably operating without oversight from the Board of Directors,” the report stated.
According to the report, it was discovered during the audit that there was no Internal Audit Department or Audit Charter at Go-Invest. As a result, the investment body was not prepared to improve its governance, risk management, provide checks and balances and monitor and implement internal controls. This was seen as a “very serious shortcoming as Go-Invest has critical data that highlights potential investments in Guyana and recommends billions of dollars in concessions to be approved by the Finance Minister.”
Regarding the position of Deputy CEO, the auditor recommended that steps should have been taken to address the “organisational deficiency,” since it has resulted in the arbitrary selection of senior staff to act in the absence of the CEO. This subsequently led to a lack of successor- training and failure to build leadership capacity.
Stressing on additional in-house deficiencies, the audit report stated that there was no clear policy at Go- Invest for remuneration of the entity’s employees. In the absence of such policy, the former CEO addressed the process at his discretion. Also, “a most unusual situation” was uncovered in that the accountant was performing the duties of the Human Resources Manager.
Additionally, the report stated that the accounting policy of Go-Invest was not properly documented regarding the processing of payments, desktop procedures and internal controls. This resulted in the absence of systems to accurately account for procurement transactions.