WINDHOEK – The Auditor-General has gone to Parliament to register his concern over local authorities and regional councils that continue to spend a lot of money, which they do not have, on hiring consultants to draw up financial statements, instead of using the money to train staff members on administration of financial books.
The Auditor-General gave the local authorities and regional councils a five-year exemption from paying audit fees provided that money is used to train staff, so that financial statements are drawn up in-house and submitted to the Auditor-General Office on time.
However, a recent survey by the Auditor-General’s Office found that most local authorities and regional councils still have no experienced staff to deal with the administration of their financial books and are hiring consultants. Only one local authority used the money to train its staff members on drawing up financial statements.
“This is an expensive exercise, which is hardly affordable for the majority of the local authorities,” said Auditor-General Junias Kandjeke in a report before Parliament last week.
A riled Kandjeke reminded the National Assembly that the five-year exemption from paying audit fees was granted on condition that local authorities use the money to train their own staff members on how to manage financial books. The authorities were supposed to have submitted their first financial statements, drawn up in-house, by March 2014. However, this has not happened.
“This non-submission of financial statements hampers the execution of my duties, causes unnecessary delays and as such I express my concern about this to the National Assembly,” Kandjeke said in the report to parliament.
The Office of the Auditor-General did a survey at the end of the 2013/14 financial years on how the local authorities used the savings from the exemption of paying audit fees. The survey revealed that only one local authority used the money to train its personnel on financial statements.
Failure to submit financial statements within three months is a contravention of the State Finance Act of 1991 and the Local Authorities Act of 1992.
Both the Local Authorities Act and the Regional Councils Act of 1992 state that the accounting officer of a local authority council shall within three months or such longer period as the Auditor-General may approve, after the end of a financial year of the local authority council make out financial statements in such form as may be determined by the Auditor-General in respect of that financial year and submit financial statements to the Auditor-General.
“This survey shows that it is still an on-going concern of which none or little progress was made during the past five financial years. As in my previous reports, it is once again recommended that the line ministry should develop a training programme to train staff at local authorities in the drafting of financial statements,” Kandjeke recommend in the report to parliament.
The report names some of the local authorities and regional councils, who are really falling behind with their submissions, as Keetmanshoop Municipality, Karasburg Town Council, Maltahöhe Village Council, Witvlei Village Council, Usakos Town Council, Ohangwena Regional Council, Omaheke Regional Council, Otjozondjupa Regional Council, Zambezi Regional Council.
The Auditor-General says the late submission hinders the responsibility of the Auditor-General to form an independent opinion, based on the audit on those statements and on the regularity of the financial transactions included in them and to report his opinion to the National Assembly.