Latest update November 5th, 2024 1:00 AM
Lack of info from Govt. agencies stymies oil sector audits – GRA
GRA Commissioner General, Godfrey S. Statia.
Kaieteur News – It was in September 2019 that the Guyana Revenue Authority (GRA) operationalised the Petroleum Revenue Audit Department (PetRAD). That department was established to serve two main purposes. The first was to ensure the administration of taxes within the petroleum sector through the performance of revenue compliance activities to ensure there is adherence to Guyana’s tax and petroleum laws and regulations, as well as, Production Sharing Agreements (PSA). The second purpose was to ensure the execution of Cost Recovery Audits aimed at verifying the expenditure claims of contractors who have entered into PSAs with the government.
Despite its best efforts to achieve the said goals, GRA noted in its 2015 to 2020 Handover Report that several challenges hindered the work of PetRAD. Chief among these was the failure of all related Government Departments to sign onto a Memorandum of Understanding (MoU) governing the sharing of pertinent information. Kaieteur News understands that this significantly hindered the authority’s ability to access the documents needed to plan all Cost Recovery and Tax Audits, as well as, adopt more proactive contemporary audit techniques.
Further to this, GRA noted the inability to control the timely achievement of audit deliverables granted that the Cost Recovery Audit is conducted collaboratively by three Government Agencies.
Another huge hurdle was the selective interpretation of the PSA and legislation by International Oil Companies and Service Providers. Given that the Oil and Gas Sector is in its rudimentary phase, GRA said that most terms within the PSA and the legislation are subject to interpretation. This has to be meticulously and punctiliously read and interpreted, which is extraordinarily time-consuming since the outcome of these inaugural activities would set precedents within this burgeoning sector, the tax body stated.
Further to this, GRA said that the complement of the Petroleum Revenue Audit Department has expanded to 14 officers since its establishment. It noted, however, that the further expansion of the department is being curtailed by inadequate accommodation. Kaieteur News understands that infrastructural works are currently afoot to facilitate the co-option of some additional resources that are currently apart of the repository.
Of the 14 officers, GRA was keen to note that only 11 are directly involved in the execution of Audits. Also, all 11 of these officers are officially assigned to the Tax Audit Division. The only assigned member of the Cost Recovery Audit Division is the Assistant Commissioner.
GRA said that a project team, constituted mainly of Managers of PetRAD, was formed to facilitate the execution of the first Cost Recovery Audit. It noted, however, that strategic decisions needed to be made as it relates to the operationalisation of the Cost Recovery Audit Division and by extension, the deployment of staff to serve within the Division.
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