Tuesday, 13 November 2018

HUGE LOSSES FOR PARASTATALS

There is material breakdown in government’s internal control financial systems and procedures, inadequate accounting processes, and significant weaknesses and misstatements of financial reports, Auditor-General (AG) Mildred Chiri has said.

In a report presented to Parliament, Chiri reported that government ministries failed to provide comprehensive financial information due to inefficient accounting systems, with some transactions grossly violating public funds use.

She said there was a need for “extraordinary corrective measures” to be taken to rescue the situation in government finances.
Government books are in such a shamble that she struggled to express an audit opinion on its financial statements.


The AG — responsible for auditing accounts, financial systems and financial management of departments, institutions and agencies of government — said that government did not properly maintain accounting records which led to irregularities.
Government ministries’ financial reports thus could not be relied upon.

“Some ministries did not maintain proper accounting assets records such as cash books and ledgers to record revenue and expenditure, immovable property, motor vehicle registers, fuel and other assets registers.

“Omission of certain information occurred resulting in misstatement of financial statements,” she said.

Chiri said as a result of inefficient accounting systems, some financial statements were compiled from bank statements, payment vouchers and cash books instead of using general ledgers.
The inefficiency reported by Chiri precipitates loopholes leading to misappropriation of tenders and funds by government ministries.

This also comes as series of duplicitous misuse of money and lack of accountability have been reported to be engulfing the government, resulting to unaccounted debts.
Reports by the Finance ministry have shown marginal debt owed to government amounting to billions, with $4,5 billion being owed by tax evaders.

Chiri alleged that government ministries were being lethargic in recovering funds causing increase of debt owed to government.

“Various ministries and their fund accounts were not putting more effort to recover amounts due to the government to the tune of $133 897 975 which is in form of rent due, surcharges, disallowances and penalties.

“In my previous report I cited lack of inefficient accounting systems and inadequate effort to collect amounts due from employees.

“During current period under review the debtors increased to $133 897 975 by 46 percent (2016: $91 409 864),” Chiri said.

Ministries were also reported be processing payments which did not have adequate supporting documents.

The unsupported total expenditure amounted to $27 101 167, with one ministry alone making a payment of $3 603 243.

The nature of the payments could not be determined by the auditor-general.
Chiri encouraged the government to put in place interventions that show comprehensive financial statements, explaining implemented programmes showing how resources were utilised, in order to avoid misappropriation of funds. Daily News

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