Less than half of UGSS spending cleared by audit

Of the $4,435,995 spent by the University of Guyana Students Society (UGSS) between October 31st, 2012 and April 30th, 2013, only $1,929,586 or 43% of the total amount could be considered bona fide expenses, according to a recent audit.

The July 10, 2013 final report of the audit by UG’s Internal Auditor Quincy Bourne,

Ganesh Mahipaul
Ganesh Mahipaul

who examined the financial transactions for the UGSS, also found that the Society failed to provide the necessary documentation and information pertaining to expenditures in excess of $1 million.

The audit was conducted after former UGSS President Ganesh Mahipaul had been accused of misappropriating $800,000 of the Society’s funds for his personal use.

In addition to finding that Mahipaul had benefitted from over $1 million from UGSS’ funds—which he subsequently repaid by the end of May—it was also discovered that the Society was lax in adhering to regulations concerning its financial activities.

According to the report, $ 1,095,000 or 25% of the expenses was identified by the UGSS Executive Council as funds misappropriated by Mahipaul, who signed an agreement to repay it by the end of May this year. He did so.

“The contract of May 14, 2013 provided for the repayment of additional sums as determined by this audit. At present, the additional sum identified was one hundred and twenty five thousand seven hundred and twenty dollars ($125,720) plus a possible two hundred and sixty five thousand ($265,000) depending on submission of receipts and return of computer equipment,” the audit report, however, added. The former figure was described as representing “disallowed” expenses, “due to the related expenses incurred being contrary to the constitution and standing orders of the UGSS or otherwise being not the responsibility of UGSS.”

The audit also found that further information was needed to properly classify payments amounting to $462,790 made by several members of the UGSS’ executive body. A breakdown of the amounts showed that apart from the $265,000 of the amounts for which Mahipaul may possibly be responsible, UGSS Secretary Adel Lily was responsible for $97,790. Additionally, both Lily and Mahipaul, along with Treasurer Sherwin Benjamin, were found to be responsible for the spending of the remaining $100,000.

The auditor said that the necessary information and/or documents on the expenditure of these amounts must be submitted by the students in question and advised The Students Welfare Division to withhold their transcripts and certificates until the information and documents are submitted. The report also found that financial reports relating to two events—an “After Sports Party” where $200,000 was spent, and a “Graduation Ball,” where $488,000 was spent—were not submitted by the stipulated deadlines. The deadlines for the submission of the reports were November 1st 2012, and November 22nd 2013, respectively, and the necessary documents and information had still not been submitted by the time the final report of the audit was submitted to the UGSS Executive Council.

Though expenditure in the form of cheque payments relating to these fundraisers were recorded in the cashbook presented to the auditor, the relating cash payments were not recorded. Furthermore, the audit report said “revenue, whether in cash or cheque were not recorded except for one (1) cheque deposit of two hundred and twenty four thousand one hundred and forty three dollars ($224,143) from Banks DIH bar sales from the After Sports Party.” These amounts together account for 16% of the Society’s expenditure, the report said.


Losses from fundraising

The audit also found that two other fundraising activities–a Stress Relief Party, and Campus Fete–failed to increase the UGSS’ financial base, but instead resulted in losses by $134,899.

Financial reports for both events were submitted, albeit after the set deadline, although both reports displayed only expenditure. Receipts or income were excluded.

In the case of the Campus Fete, the auditor found that monies received from ticket sales were not accounted for. The report, in part, said, “Based on assertions, the UGSS Secretary need to account for seven hundred and fifty (750) tickets. However, there was no corroborating evidence to determine the numbers and types of tickets given to UGSS to distribute. There was a statement from Guyana Revenue Authority (GRA) indicating the number of patrons who attended the event. Additionally, there was a cardboard box that UGSS officers asserted contained all the tickets surrendered at the event. The contents of the box were sorted, analysed and compared with the amounts shown on the GRA statement.”The analysis found that $230,000 in tickets were unaccounted for, although the auditor admitted that “there was no corroborative evidence to support either analysis. If the GRA statement was deemed accurate then the box did not contain all the tickets surrendered.” Furthermore, undistributed tickets amounting to $1,167,000 were still in UGSS’ office.

In April, Mahipaul was sent on leave until the completion of the audit. However, by way of a letter from Lily, dated June 24, he was notified of his suspension as a result of the Executive Council’s passage of a no-confidence vote against him. The letter stated that he had misconducted himself and had breached the UGSS constitution by virtue of his borrowing money for his personal use. He was also informed that if he was desirous of challenging the decision, he should do so within 21 days.

Mahipaul has since said that he had yet to receive a letter bringing to my attention the reasons why he was guilty of conduct injurious to the society or afforded the opportunity of giving an explanation in person within 21 days. “It is most unfortunate that the UGSS Executive Council did not commission an independent hearing so as to allow me the opportunity to relate what actually occurred during the month of December with reference to the finances belonging to UGSS. I am extremely disappointed to say the least, that a conclusion was come to without a hearing, and that I received a missive dated June, 22 2013 from the Secretary, stating that I was guilty of misconduct while performing the duties of President of UGSS and also of the misappropriation of funds by converting and spending the society’s funds on my personal expenses,” Mahipaul wrote in a letter, published in Wednesday’ edition of Stabroek News.

Meanwhile, the audit report noted weaknesses and/or opportunities for improvement in internal controls were also highlighted and the current UGSS Executive can be guided accordingly. “These findings by their nature are critical as they relate to the discrepancies and weaknesses observed and do not address any strong or good features that UGSS’ works or performance may have manifested during the period under review,” it added.

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