This has resulted in Auditor-General Mildred Chiri questioning whether the payments were actually made against existing debts.
The development comes at a time it has emerged that the Zimbabwe National Army (ZNA) and Air Force of Zimbabwe (AFZ), for the third year running, flouted government regulations by refusing to submit their asset registers for the government audit.
The narrative report on appropriation accounts and miscellaneous funds for 2013 compiled by Chiri reveals that the Ministry of Defence did not obtain confirmation of payment from service providers, despite a request from Treasury.
As a result, the U$35 million could not be accounted for.
“During the 2013 financial year, an amount of US$35 164 363 was directly paid by Treasury to the service providers on behalf of the ministry,” noted Chiri.
“Treasury advised the ministry to obtain confirmation of payments from each respective service provider. However, there was no indication that this was done and no reconciliations were produced to show the actual invoices paid and actual amount owed to each service provider.
“As a result, I could not confirm whether the direct payment made by Treasury were paid against existing debts and that the ministry’s accounts were subsequently credited with the same accounts.”
She also said there was a risk that non-reconciliation of payments may result in duplicate payments or billing errors not being timeously detected.
Chiri expressed concern over the ministry’s failure to submit the ZNA and AFZ departmental assets certificate, a trend since 2011. She said failure to provide asset certificates may result in the ministry not being fully accountable for its assets “thereby exposing them to misuse and theft”.
“In my 2011 and 2012 reports, I raised concern over the ministry’s failure to submit a departmental asset certificate for the whole ministry as required by Treasury Instruction 2004, which states that the accounting officer should submit a certificate to show that the assets have been physically compared against records, not later than two months after the close of each financial year.
“The problem persisted in 2013 with ministry officials not taking corrective action. The ministry submitted a departmental asset certificate, which did not include assets from the Zimbabwe National Army and Air Force of Zimbabwe. Therefore, I was not able to confirm the assets had been properly accounted for.”
A management response from the ministry highlighted that copies of the departmental assets certificate for ZNA and AFZ would be submitted to auditors, but Chiri said at the time of finalising the audit, certificates were still to be obtained.
In 2011 and 2012, the ministry also promised to ensure that asset registers were submitted, but failed to do so. Chiri also expressed concern over the manner in which the War Veterans Fund was being run and could not account for more than US$17 million spent on school fees under the fund. The fund was established to render financial assistance to war veterans and their dependants. It provides loans to finance income generating projects, grants, funeral expenses, manpower development as well as for the physical, mental and social rehabilitation of war veterans. Chiri, as in her 2011 report, noted that school fees for war veterans’ dependants were being deposited directly into the war veterans’ bank accounts instead of being paid directly to education institutions.
“As a result, it was difficult to verify if the funds deposited into these accounts were used to pay fees for the dependants,” said Chiri.
“No supporting documentation in the form of receipts was attached to payment vouchers to show that the amounts disbursed by the fund as education assistance were used for the intended purpose.
“Furthermore, the fund could not provide a list of dependants receiving the assistance or the schools they attended where the fees were paid. Therefore, I was not able to confirm the correctness of the education assistance expenditure of US$17 040 606 disclosed in the financial statements, which constituted 93% of the total expenditure of the fund.”
Chiri recommended that the fund should attach documentation to support the education assistance, while also depositing directly into learning institutions’ accounts.
