By Mathias Haufiku
WINDHOEK– The Chairperson of the Parliamentary Standing Committee on Public Accounts, Usutuaije Maamberua, said government ministries with multiple bank accounts – some as many as 40 – run the risk of losing money because of lack of control.
Speaking to New Era last Thursday he urged ministries only to keep accounts that are necessary.
Some ministries have N$600 in some of their bank accounts, the auditor general’s office said.
Most line ministries hardly provide source documents relating to bank accounts to the auditor general for audit purposes. This has prompted the AG, in many of his reports on the accounts of line ministries, to stress that ministries should provide source documents for audit purposes.
The Auditor General’s Report on the Accounts of the Ministry of Education for the financial year ended 2012 indicate that the ministry has 43 separate bank accounts with Nedbank, First National Bank, Standard Bank and Bank Windhoek.
Meanwhile, for the same financial year, the Ministry of Environment and Tourism operated 18 bank accounts, but the accounting officer did not submit any source documents such as a cashbook, bank reconciliation statements and income and expenditure statements for seven bank accounts for audit purposes.
During the 2012 financial year, the Ministry of Gender Equality and Child Welfare operated 12 bank accounts.
Another report, which New Era stumbled upon, is that of the Ministry of Health and Social Services. The auditor general’s 2009 report on the ministry’s accounts indicate that the ministry operated 43 accounts but the accounting officer at that ministry failed to submit the bank statements and necessary documents and records to enable the auditors to audit the petty cash account and cash advance bank account that are operated by ministerial staff.
“If you have too many bank accounts you lose control over them and at the same time the transparency of that ministry comes into question because the financial system of an institution with many bank accounts cannot be transparent. Even the auditing processes are made difficult,” said Maamberua.
Maamberua fears that some of the bank accounts may go unnoticed since there may be ministries who perhaps do not declare all accounts.
He is also sceptical whether ministries with multiple bank accounts have indeed – as prescribed by the State Finance Act of 1996 – received permission from Treasury to open bank accounts.
“There is nothing wrong with line ministries having more than one bank account, but the accounts should be justified and opened according to the needs of that specific ministry,” he said.
He also said there is no need for a law aimed at controlling the number of bank accounts a ministry may have because ministerial needs differ from one ministry to the other.
“Bank accounts are opened according to the needs of the ministries, but we really advise them to consolidate their accounts and keep them as low as possible. Having a ceiling in terms of the permissible number of bank accounts for each ministry or government agency will not do any justice,” he said.
“The potential risk of multiple bank accounts is very high, and besides, why would you keep an inactive account, when it actually hampers the checks and balances systems,” questioned Maamberua.
The fact that some line ministries have more than 30 bank accounts attached to their names could have serious implications on the control and regulation processes within such ministries. This is also the reason why in most instances bank accounts are not reconciled and statements are seldom availed for auditing purposes.
“Ministries should not give themselves leeway to keep multiple accounts because it will create the impression among the staff to open bank accounts at will for any given motive,” he warned.
In its 2011 report on the Review of the Auditor General Reports on the Central Government for the financial years ended 31 March 2007 and 2008, The Parliamentary Standing Committee on Public Accounts recommended that accounting officers keeping redundant bank accounts should close them forthwith and in the case where bank accounts are active, accounting officers should ensure regular reconciliation of such bank accounts and financial statements should be availed for audit purposes on an annual basis.
In the same report, the committee observed under its findings that many government offices, agencies and ministries are keeping numerous bank accounts some of them bearing nominal balances.