Dr. Ibrahim Lahai Stevens, Bank of Sierra LeoneAuditors from Audit Services Sierra Leone discovered a staggering discrepancy in the Bank of Sierra Leone’s vault systems, revealing a significant difference between recorded cash balances and actual physical cash held in the vaults.
This alarming revelation was made during a cash count at the Kenema Branch on June 11, 2024, when auditors discovered a variance of two billion, one hundred and seventy-five million New Leones ( NLe2,175,000,000), equivalent to a staggering NLe2.1 trillion in old Leones. The audit process included a thorough review of the currency in circulation as well as an extensive cash count at the Bank of Sierra Leone’s branches in Freetown and Kenema. It was discovered that the physical cash—including notes and coins—stored in three separate vaults did not correspond to the system balances recorded in the bank’s trial balance.
The differences were especially noticeable in Vault I, which houses new notes and coins, Vault II, which houses mutilated currency, and Vault III, which is designated for operational currency management. The Bank’s Operational Manual clearly states that daily vault tallies should be conducted. These tallies are intended to reflect the various categories and total value of currency stored in vaults.
The procedure entails extracting balances from vault records and comparing them to the physical stock present. Once completed, these vault tallies should be reconciled to the Currency Management Manager’s treasury book balances. However, during the audit at the Kenema Branch, it became clear that there was a significant discrepancy between the actual cash in the vaults and the recorded vault balance. Auditors also noted that the Kenema Branch had a net overage of NLe3,605,815 in total physical cash when compared to the total system balances for the respective vaults. This disparity raises serious concerns about the integrity of the bank’s cash management processes. Particularly concerning was the observation regarding the newly redenominated Leones, where significant differences were noted between the physical cash in the vaults—both minted and reissued notes and coins—and their corresponding vault system balances.
This inconsistency highlights potential issues in tracking and managing cash flow within the bank. In response to the auditors’ findings, Bank of Sierra Leone officials acknowledged the discrepancies, saying, “We take note of your observations. The surplus difference has been accounted for as other liability.”
They also stated that a special working group has been formed to thoroughly investigate the variance and hope to resolve the issue by the end of March 2025. Despite these assurances, auditors have discovered that the unreconciled differences have not been resolved, and the surplus has simply been recorded as another liability on the bank’s books.
This situation necessitates immediate attention and action by the Bank of Sierra Leone to ensure the accuracy and reliability of its financial reporting and cash management practices. The ongoing investigation is critical for restoring trust in the bank’s operations and protecting public funds.
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