Deadline for Zacc to carry out local authorities audits
PARLIAMENT’S Public Accounts Committee (PAC) has given the Zimbabwe Anti-Corruption Commission (Zacc) a 23 July deadline to carry out systems compliance audits across all local authorities after it emerged that several of them were last audited between 2017 and 2019, raising the risk of corruption, and mismanagement of fund, The NewsHawks has learnt.
PAC also ordered local authorities, with immediate effect, put in place backup systems for information, while ordering the Ministry of Local Government to procure current accounting software by 30 June 2023.
Local authorities are required by Section 35 (6) of the Public Finance Management Act (PFMA) to submit audited accounts to the Auditor-General.
However, findings by the committee show that 16 local authorities, including city councils, rural boards, municipal councils and rural district councils were yet to send submit audited accounts to Auditor General Mildred Chiri’s office.
The report presented in parliament this week by Kadoma Central legislator Muchineripi Chinyanganya shows that Gweru City Council is yet to submit its financial accounts for the period spanning from 2017-2019.
Gwanda Municipality and Beitbridge Town Council are also yet to submit their audited accounts dating from 2018 to 2019, while Hwange local board has missing financial accounts of between 2017 and 2019.
Rural District Councils (RDC) make the bulk of local authorities that are yet to submit, with their accounts unaudited between 2018 and 2019.
The committee observed that failure to comply was caused mainly by incompetence, the Covid-19 pandemic and lacklustre appointments of comptrollers by the Auditor-General and use of old-fashioned methods of accounting.
“It was caused by the following; failure by some local authorities to back up their accounting data which resulted in delays in case of systems failure, lack of sound accounting packages like Pastel and Sage in some local authorities.
“High staff turnover in some local authorities resulted in inadequacy of staff. This was caused by poor uncompetitive remuneration leading to skills flight and brain drain. Incompetent treasurers as in the case of former Hwange Rural District Council treasurer who was not executing his duties well.
“Delays by Auditor General in appointing auditors in time resulted in some councils having to wait for a period of time before being assigned an auditing firm. Covid-19 restrictions hampered progress. The lockdown restrictions of March 2020 made it difficult for entities to fully function,” according to the report.
Most rural district councils have been using manual accounting systems, which are not only inefficient, but prone to delays and financial leakages.
For instance, Beitbridge Rural District Council informed the committee that the upgrading of the council’s Enterprise Resource Planning (ERP) system, that is the Pastel Evolution from Version 8 to Version 11 caused much of the delay.
“There were teething problems that came with the upgrade of the system and the software vendor took a considerable time to resolve the challenges,” reads the report.
In that regard, PAC has also given local authorities, in liaison with the Ministry of Local Government the task to procure current accounting software by 30 June 2023.
Other local authorities are also set to foot huge bills to cover the uncovered audit period.
Hwange Local Board officials told the committee that they need over ZW$5 million in audit fees, to audit council’s arrears of over five years.
PAC also said measures that will enable the local authorities to submit their audited statements for audit, should be put in place.
“The auditing firms and local authorities should embrace the use of technology and must adapt to conduct audits online in line with Covid-19 restrictions by 30 June 2023. The Auditor General should conduct due diligence before appointing the accounting and auditing firms to carry out the work on its behalf as some were failing to carry out the assigned audits on time or at all.
“These appointments must be done by the 8th February of each year as to allow the local authorities to comply with the Public Finance Management Act and the Constitution,” PAC said.