In its latest report, the Audit Office noted several discrepancies in the Guyana Defence Force’s spending for 2017. For instance, the Auditors found breaches in a $52.6M project where the GDF paid $17M to a contractor for the completion of plumbing works that he did not even begin.
Auditors noted that a $52.638M contract for the construction of a timber wharf, approach and floating raft at the Guyana Defence Force Coastal Battalion, New Amsterdam was awarded by the National Procurement and Tender Administration Board (NPTAB) to the lowest most responsive of three bidders.
The Engineer’s Estimate was $54.508M. The contract was signed on 3 November 2017. The starting date was supposed to be within seven working days after signing of the contract and an intended completion date of six months after signing. The defects liability period was three months.
The contractor received an advance payment of $15.476M, representing 30 percent of the contract sum on November 30, 2017, followed by one interim payment of $16.858M on May 8 2018.
Auditors said that at the time of reporting, the total payment received by the contractor was $32.351M.
However, it was discovered at the time of the physical verification on August 29, 2018, the GDF prepared, certified and paid the contractor a total of $17.830M for works which had not yet commenced on site.
Auditors noted, “Valuation №.1 was grossly inflated to reflect that the works under the contract were in an advanced stage of completion, resulting in the contractor receiving a total of $32.351M or 61 percent of the contract sum at the time of the physical verification.
Auditors observed that the contractor was on site but only clearing and earthworks on the approach to the wharf had commenced, “contrary to what was paid for in Valuation №.1, which certified payments for the wharf, plumbing and electrical installations.
Further, it was noted that according to the contract, the duration for completion of the works was six months from signing, however, “at the time of reporting, a total of nine months had elapsed and the works were incomplete; and no performance bond or advance payment bond was seen in the documents examined; as such it is unclear if there was a valid bond at the time of reporting.
Auditors reported, “It is unclear if the advance payment was recovered at the time of reporting. In addition, it could not be determined from Payment Voucher examined who certified the works. Physical verification of the works revealed that the contractor was overpaid the sum of $17.830M,” the audit report stated.
In the Audit report, the GDF was quoted saying that it is working to recover the overpayment by 24 September 2018 in that the contractor will present a cheque for the overpayment in the name of the Finance Officer, GDF. The GDF Engineer will monitor the on-going works more closely to ensure the pace of work is increased, in keeping with the payments made.
The Audit Office recommended that the Administration of GDF recover the amounts overpaid and implement systems for the proper monitoring of all works.
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