Nkurenkuru instructed to fix mess
The Nkurenkuru town council has been ordered to supply answers to the auditor-general's queries.
15 August 2019 | Government
The National Council Standing Committee on Public Accounts and Economy has instructed the Nkurenkuru town council to deal with the queries raised in an auditor-general's report, which points to poor accounting practices.
Committee chairperson Peter Kazongominja and his fellow MPs told Nkurenkuru CEO Petrus Sindimba and the council's finance officer Jairus Kakoro on Tuesday to provide satisfactory answers to the concerns raised in the report.
The main objective of the public hearings is to consider material findings raised in auditor-general reports and compile a report with recommendations to be tabled in the National Council.
According to the auditor-general's report on the Nkurenkuru town council for the 2017/18 financial year there were a number of issues detected by the auditors that need serious intervention, for the sake of transparency. It was discovered that the council does not have a fair presentation framework for financial reporting and no detailed fixed asset register. There is also no depreciation policy and there was a non-disclosure of a bank account with an amount of about N$41 000 in it.
It was further discovered that the council had an appropriation balance of about N$7 million between the opening and closing balances.
The financial information also did not include a cash flow statement and notes, while there were also unexplained adjustments on expenditure and revenue amounting to about N$5 million and N$2 million, respectively.
The council also did not provide erven sale agreements to the auditors, as well minutes of the procurement committee meetings that awarded two tenders amounting to a combined N$6 million.
The issue of conflict of interest was also raised, as the council did not present any declarations for those sitting on the procurement committee.
Council's response
Sidimba explained that the undisclosed bank account is a holding account for the Nkurenkuru Trade Fair Expo and is not used for operational activities.
Sidimba said the non-disclosure was an oversight on their part, as they relied on the consultant who used to prepare their financial statements.
“We have taken note of it and we will ensure that all our accounts are disclosed,” Sindimba said.
On the issue of the appropriation account difference of about N$7 million, Sindimba said it was a human error on their part.
He said it resulted from the council having recorded an accumulated surplus of about N$15 million at the end of the financial year ending 30 June 2017, while the opening balance on 1 July 2017 in the financial statement shows an amount of about N$22 million.
Sindimba also explained that they relied on the International Public Sector Accounting Standards (IPSAS) depreciation calculator, which is why they did not have a depreciation policy in place.
On the lack of land sales agreements, Sindimba said they were only issuing deeds of sale and not sales agreements. However, a council resolution was passed that land sales agreements were to be used. The agreement was presented in the parliamentary meeting.
The parliamentary committee applauded Sidimba for his honesty, especially by admitting they had omitted some of the required documents and for assuring them he will take the advice of the committee to heart.
KENYA KAMBOWE
Committee chairperson Peter Kazongominja and his fellow MPs told Nkurenkuru CEO Petrus Sindimba and the council's finance officer Jairus Kakoro on Tuesday to provide satisfactory answers to the concerns raised in the report.
The main objective of the public hearings is to consider material findings raised in auditor-general reports and compile a report with recommendations to be tabled in the National Council.
According to the auditor-general's report on the Nkurenkuru town council for the 2017/18 financial year there were a number of issues detected by the auditors that need serious intervention, for the sake of transparency. It was discovered that the council does not have a fair presentation framework for financial reporting and no detailed fixed asset register. There is also no depreciation policy and there was a non-disclosure of a bank account with an amount of about N$41 000 in it.
It was further discovered that the council had an appropriation balance of about N$7 million between the opening and closing balances.
The financial information also did not include a cash flow statement and notes, while there were also unexplained adjustments on expenditure and revenue amounting to about N$5 million and N$2 million, respectively.
The council also did not provide erven sale agreements to the auditors, as well minutes of the procurement committee meetings that awarded two tenders amounting to a combined N$6 million.
The issue of conflict of interest was also raised, as the council did not present any declarations for those sitting on the procurement committee.
Council's response
Sidimba explained that the undisclosed bank account is a holding account for the Nkurenkuru Trade Fair Expo and is not used for operational activities.
Sidimba said the non-disclosure was an oversight on their part, as they relied on the consultant who used to prepare their financial statements.
“We have taken note of it and we will ensure that all our accounts are disclosed,” Sindimba said.
On the issue of the appropriation account difference of about N$7 million, Sindimba said it was a human error on their part.
He said it resulted from the council having recorded an accumulated surplus of about N$15 million at the end of the financial year ending 30 June 2017, while the opening balance on 1 July 2017 in the financial statement shows an amount of about N$22 million.
Sindimba also explained that they relied on the International Public Sector Accounting Standards (IPSAS) depreciation calculator, which is why they did not have a depreciation policy in place.
On the lack of land sales agreements, Sindimba said they were only issuing deeds of sale and not sales agreements. However, a council resolution was passed that land sales agreements were to be used. The agreement was presented in the parliamentary meeting.
The parliamentary committee applauded Sidimba for his honesty, especially by admitting they had omitted some of the required documents and for assuring them he will take the advice of the committee to heart.
KENYA KAMBOWE
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