Investigation by Civil Society Organisation, iWatch Africa, has revealed that failure of some six mining companies to pay dividends due Ghana deprived the nation of potential revenue amounting to $14,148,373 as at October 2018.
A review of the financial statements of the mining companies, namely; Chirano, Adamus, Gold Fields Abosso, Persus Mining, Ghana Manganese and Ghana Bauxite, revealed that although in certain instances they declared profits, they failed to transfer dividend attributable to the government.
According to the Civil Society Organisation, “Further checks at the Auditor General’s office also showed that these companies failed to obtain the needed prior approval from the Ministry of Finance for the plough back of the profit.”
Another concern noted by iWatch Africa when reviewing the financial statements of these companies was the staggering losses recorded by almost all the companies between 2013 to 2016.
Meanwhile, the government of Ghana under Section 43 of the Minerals and Mining Act of 2006, Act 732, has 10% Carried Interest in all mining companies registered under the Companies Act of 1963.
Mining companies are required to submit on annual basis, their returns to the Registrar General’s Department and the Minerals Commission as well as conduct annual self-assessment and submit same to Ghana Revenue Authority for tax purposes.
In 2018, the Auditor General, Mr. Daniel Yaw Domelevo in his report disclosed the absence of government representation on the boards of these mining companies, despite government ownership of 10 percent carried interest.
This, according to the Auditor General, “inhibits oversight functions and possible cause for cost manipulation by the mining companies.”
The table below shows the profit/loss after tax (PAT), dividends declared and potential revenue due the state between 2013 and 2016.
Following iWatch’s revelation, the Lands and Natural Resources Minister, Kweku Asomah Cheremeh, has intimated, firms shortchanging the country will be made to face the rigours of the law.
Speaking to Citi News, the minister said, should the companies be found not paying dividends, “then the wrath of the government would be visited on them.” Mr. Cheremeh added, “They (non-compliant firms) are seeking to thwart the efforts of government and they are seeking to derail all the effort the government has brought into being.”
He insisted that he will champion the interest of the state “and that can even cause the revocation of the licences.”