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AG: DON’T GIVE MONEY TO 11 PUBLIC ENTERPRISES

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MBABANE - The Auditor General (AG), Timothy Matsebula, has suggested that government should withhold subventions for public enterprises that do not submit audited financial statements.


According to the AG’s Report on the Consolidated Government Accounts for the Financial Year ended March 31, 2019, about 11 public enterprises have not been compliant in terms of submitting their audited financial statements.
So serious is the issue that one of them, the Eswatini National Trust Commission (ENTC), is alleged to have last submitted its audited financial statements in 2016.


Matsebula was speaking during a media briefing where he unpacked his report at the Hilton Garden Inn yesterday.
During the briefing, members of the media asked for his opinion on how public enterprises that did not comply could be dealt with.
In his report, the AG stated that each year government, through its ministries, provided financial support to its public enterprises in the form of subvention, to implement capital investments.


Addition


He said he observed that in addition to the initial capital investments, government transferred an amount of E1 409 355 886 to support its public enterprises in the financial year ended March 31, 2019 but that an amount of E824 968 703 was not audited.


He mentioned in his report that some public enterprises did not submit the audited financial statements as required by the Public Enterprises Monitoring and Control Act, something which he said indicated that the subventions they received were not accounted for.


Such a scenario, according Matsebula, made it difficult to ascertain whether the subventions were used for their intended purpose or not.
When addressing the media yesterday, Matsebula said his office could not carry out audits for the aforementioned public enterprises if they did not submit their financial statements.


“It is wrong to continue pumping in funds to these public enterprises when they cannot be accounted for. We are hopeful that since we now have a tribunal that will focus on public accounts, this will be rectified. Government needs to withhold the subventions until the public enterprises comply,” said Matsebula.


Other public enterprises which make up the list of those that did not submit their financial statements include the Eswatini Water and Agricultural Development Enterprise, University of Eswatini (UNESWA), Eswatini Christian Medical University (ECMU) and Southern Africa Nazarene University (SANU), among others.


The AG stated in his report that all government controlled business enterprises were guided by Section 7 of the Public Enterprises Monitoring and Control Act, 1989 and the Public Enterprises Unit (PEU) Circular No.3 of 2008 to have their annual accounts audited and submitted to both his office and that of the Public Enterprises Unit for review.


“Thus, the public enterprises listed failed to comply with the statutory requirements,” he mentioned in the report. Furthermore, Matsebula said the Public Finance Management Act, 2017 required that government’s consolidated annual accounts should, at a date to be determined by the minister responsible for Finance, integrate all accounts of government business enterprises, presented in accordance with international accounting standards.


Concerned


“I am concerned that the delays in having all public enterprises audited not later than six months after the end of each financial year, shall inevitably delay the date at which the minister of Finance could officially determine that all public enterprises should submit their audited accounts for consolidation to the government’s annual financial statements, as required by the law and international accounting standards,” said the AG.


On another note, during the question and answer session yesterday, the AG strongly disputed that there was interference in his work.
Matsebula was asked by journalists on whether there was any interference when it came to auditing certain public enterprises.


“There is no interference because the Constitution gives my office the independence to conduct its work. We have not experienced any interference of any kind. Regarding entities that were not included in the report, it could just be that we have not been able to cover more,” he said.


This publication made an effort to contact some of the parastatals to determine the challenges they faced, which made them not to submit the required audited financial statements.


It was discovered that one of the entities, the Eswatini National Youth Council, found itself with a backlog of documents to compile and submit following that it operated without a chief executive officer for quite some time.


This was said by the current CEO, Makhosini Dlamini, who then referred this reporter to Board Chairman Babsy Mavuso, who also concurred with Dlamini’s statement.


“The council did not have a CEO for a long time. When the new one was hired, he found that there had not been an audit for three years. So he found himself with a backlog and so far we have completed three. So basically, we could not submit the one for the previous financial year in question because we were still chasing the old ones,” explained Mavuso.


He mentioned that the council had completed financial statements for the 2013/2014, 2015/2016, 2017/2018 financial years and was in the process of compiling the one for 2018/2019. On another note, Eswatini Sports Council’s Spokesperson Dumisani Ntiwane refuted the reports that the entity had not submitted the financial statements.


Submitted


He said they always made sure that they submitted on time. “I know for a fact that we always submit. I am yet to determine if the reports are true,” he said.
Other public entities were sent questionnaires but had not responded at the time of going to print.


Speaking on behalf of ETBC was its Corporate Affairs Manager Mncedisi Mayisela, who stated that the entity was audited every financial year and that its report was then handed over to the Board.


He mentioned that perhaps there was a need to check if there were no anomalies in terms of submitting the reports to the AG’s Office.
“I think it is an issue of procedure because KPMG audits us every financial year.

The report goes to the Board. So basically we report through the Board and I do not recall us submitting the report to the AG’s Office. This means that we need to be properly guided so that if there are anomalies, they can be sorted,” he said.

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