GHANA Law and Practice Contributed by: Victoria Bright and Justice Oteng, Addison Bright Sloane
6. Audit, Risk and Internal Controls 6.1 External Auditors It is a legal requirement in Ghana for companies to appoint an external auditor to examine and verify their financial statements. It is explicitly stipulated that external audits are a statutory requirement for companies operating in Ghana. Failure to comply with this requirement can lead to penalties for regulatory non-compliance. Generally, appointments are made by an ordinary res - olution of the company at the AGM. Where a company fails to appoint an auditor, the Registrar of Companies can make the appointment. Again, public companies and regulated companies seek approval from the SEC for the appointment. However, according to directive number 5 issued by the ORC, there are exemptions and waivers for small and medium-sized companies whose revenue or assets are GHS400,000 and between GHS400,001and GHS10 million, respectively. Alternatively, these com - panies may be required to undergo a limited review engagement or provide a brief report on financial statements prepared by the internal auditor, adher - ing to all relevant standards adopted by accounting bodies. It is important to state that the exemption clause excludes small companies that are part of larger cor - porate groups. The relationship between a company and its auditor is governed by: • the Companies Act, 2019 (Act 992); • Securities and Exchange Commission guidelines; and • Professional Accounting Standards and Corporate Governance Codes. These frameworks set out the rules aimed to ensure the following: • appointment is devoid of disqualification; • independence, accountability or opinion on finan - cial statements is expressed;
responsibility for anti-money laundry compliance on the board of directors. Boards are required to adopt a risk-based method ensuring that internal controls are effective, documented and regularly tested for compliance. The regulatory requirements for the board’s oversight are as follows. • Formal approval for compliance programme – Boards must have a comprehensive operational Anti-Money Laundering and Countering the Financ - ing of Terrorism Compliance Programme. Boards are required to establish internal control systems to obstruct companies from being used for money laundering. • Oversight of principal personnel and reporting – Boards are required to appoint a senior officer as AML reporting officer. Boards are to receive periodic reports on operations, risk assessment and effectiveness of the AML framework from the reporting officer. • Fiduciary duties – Boards are to ensure continu - ous compliance with AML policies. Customer due diligence and transactions must be managed effectively for future auditing. The AML compliance programme must be subjected to independent testing for its effectiveness. • Personal liability – (a) Failure by the board to allocate adequate resources or to establish appropriate oversight can lead to severe penalties, including fines of lower limit of 500 and upper limit of 20,000 penalty units for directors. (b) Upon failure to deliberate and approve key AML/CFT compliance policies, procedures or programmes or any other AML/CFT, directors face not less than 500 penalty units and not more than 20,000 penalty units. (c) Failure by the director of human resources to undertake adequate screening when hiring an employee and during employment of that employee shall attract penalty units of not less than 500 and not more than 20,000 penalty units.
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