The National Assembly’s Standing Committee on Public Enterprises (PEC) has revealed that the National Water and Electricity Company (NAWEC) accumulated losses of D6.4 billion by the end of 2022, while raising serious concerns over the utility’s financial reporting, procurement practices, and internal accounting controls.
The findings are contained in the committee’s report on its scrutiny of the audited financial statements, management letters, and activity reports of state-owned enterprises for the 2022 financial year.
According to the report, NAWEC recorded a loss of D3.3 billion during the 2022 financial year, leaving the company with a net liability of D2.1 billion and accumulated losses totaling D6.4 billion.
The committee warned that these financial indicators cast significant doubt on the utility’s ability to continue operating as a going concern.
“The entity made a loss for the year of GMD3.3 billion and an accumulated loss of GMD6.4 billion and a net liability of GMD2.1 billion,” the committee stated in its report.
Despite the deteriorating financial position, PEC noted that NAWEC did not perform a formal going concern assessment, a key accounting requirement used to evaluate whether an organisation can continue operating in the foreseeable future.
The committee has therefore directed NAWEC’s Board and Management to conduct a comprehensive annual going concern assessment beginning with the 2026 financial year.
Revenue Discrepancies
The committee also uncovered inconsistencies in the utility’s revenue records.
Auditors identified differences between monthly electricity and water sales reports generated by NAWEC’s billing department and figures recorded in the company’s General Ledger. The discrepancies amounted to D18.53 million for electricity sales and D175,336 for water sales.
The report further questioned NAWEC’s accounting treatment of prepaid electricity revenue.
According to the committee, revenue from prepaid electricity sales was recognised immediately after customers purchased electricity units, but no corresponding accounting entry was recorded when the electricity was actually consumed.
PEC said this approach raises concerns over compliance with the matching principle under accrual accounting, which requires revenues and the related costs to be recognised within the same accounting period.
Procurement Irregularities
The report also identified procurement weaknesses, revealing that several suppliers awarded contracts by NAWEC were not registered with the Gambia Public Procurement Authority (GPPA) at the time the contracts were issued.
The committee said the affected contractors included suppliers engaged for equipment hire, transportation, excavation works, and the provision of various goods and services. It further found that some of these suppliers were not included in NAWEC’s approved vendor register.
Continued Financial Support
Presenting the report before the National Assembly, PEC Chairperson and Brikama South lawmaker, Hon. Lamin J. Sanneh, observed that NAWEC has continued to depend heavily on financial support from both the government and development partners.
He told lawmakers that the utility reportedly recorded losses of approximately D3.6 billion in 2024, received about D1.6 billion in World Bank support in 2025 to help settle Karpowership-related obligations, and also benefited from government intervention through the assumption of approximately D1.2 billion in debts and arrears.
Committee Recommendations
To strengthen the utility’s financial management, the committee recommended that NAWEC reinforce its internal control systems, ensure strict compliance with public procurement regulations, and improve financial reconciliation procedures.
PEC also urged the company to reconcile discrepancies between its billing records and the General Ledger and ensure full compliance with applicable accounting standards governing revenue recognition and financial reporting.
