State-Owned Enterprises or SOE have been urged to prioritize the use of strategic management and financial reporting in mitigating potential risk, associated with noncompliance within the sector.
The admonition was made at the climax of a two-day strategic management and financial reporting workshop, organized by the Ministry of Finance and Development Planning SOE Financial Reporting
The workshop was intended to address the planning and reporting requirements as prescribed by the PFM Law, as well as to develop a way forward in mitigating any potential risk associated with noncompliance by SOE’s.
According to the ministry’s SOE Coordination Unit Director Siafa Chowoe, the workshop was aimed at strengthening the capacity of SOEs, where there are gaps in terms of making their financial report.
Mr. Chowoe said the PFM Law requires SOEs to submit quarterly and annual financial statements, as well as their entity’s strategic plans to the Minister of Finance and Development Planning. Speaking yesterday, February 4, 2016, Director Siafa Chowoe indicated that the workshop discussed the PFM law and Regulatory requirements,
as well as the risk of noncompliance. He noted that challenges faced by SOEs in the implementation of Section 43-46 of the PFM Act of 2009 were also discussed, describing his unit as the point of focus to collect, analyze and interpret financial and strategic plans submitted by SOEs to the ministry, with the goal of ensuring strict compliance with the provisions of the PFM Law and its regulations.
Moreover, he said the submission of the SOEs strategic plan, annual financial plans and periodic financial performance reports remains a challenge due to either misunderstanding or capacity gaps. The two-day workshop was expected to improve efficiency and transparency to strengthen financial reporting within three years, as well as focused on strategic planning and annual budgeting.
Also speaking, Liberian Economist Samuel Tweah said SOEs play a critical role in the development of the nation’s economy, noting that SOEs have accounted for 11 percent of the public wage, thus
contributing 4.3 percent to the country budget in the amount of US$22.6M in 2015/2016 fiscal year; while Sierra Leone accounted for 5
percent of the public wage bill.
He further stated that total expenses for all SOEs in 2014 amounted to US$ 33M, which accounts for 13 percent of the public wage bill. SOEs are also expected to embrace the new standards of methods regarding strategic management and financial reporting.
By Lewis S. Teh-Edited by George Barpeen