AUDITOR General Anna Chifungula has stated that the K20 billion that was released by the Ministry of Finance to cater for late president Levy Mwanawasa’s medical and funeral expenses in 2008 was irregularly spent and unaccounted for by some spending agencies.
In her report on public accounts for the financial year ended December 31, 2008, Chifungula stated that during the period under review unvouched expenditure was the most common irregularity.
Chifungula indicated that the issue of the medical and funeral expenses of the late president Mwanawasa was one of the accounting irregularities that had been sighted under Head 8, Cabinet Office-Office of the President in 2008.
“In the Estimates of Revenue and Expenditure for the financial year ended 31 December 2008, a provision of K170, 322, 361, 649 was made out of which a total of K111, 697, 249, 099 was released leaving a balance of K58, 625, 112, 550,” the report read. “In August 2008, the Ministry of Finance and National Planning released a total amount of K10, 000, 000, 000 to cater for the medical expenses for the late President. In September 2008 the Ministry further released K10, 000, 000, 000 to cater for funeral expenses.”
The report tabulated that the amount was to be spent as follows: fuel (K450, 000, 000), imprest (K2, 711, 570, 925), hire of cars, tents, toilets and conference (K480, 392, 310), construction of burial site (K2, 568, 360, 077), air travel (K408, 677, 953), decorations (K573, 385, 100), lodging/food (K58, 036, 900), printing (K467, 304, 768), payment to France (K1, 653, 987, 025), payment to London (K126, 684, 619), PS Community Development (K10, 340, 000), PS (Hunting of Animals) (K36, 990, 000), PS Foreign Affairs (K118, 395, 000), PS Defence (K45, 000, 000), PS Information (K370, 080, 000) and PS Works and Supply (K1, 826, 216, 486).
Other recipients were Provincial Administration-various (K1, 150, 000, 000), Director General-OP (K5, 198, 150, 000), Zambia Army (K1, 089, 684, 000) and Lusaka Town Clerk (K479, 363, 600) bringing the total to K19, 822, 618, 763.
“According to existing arrangements, all the spending agencies funded were supposed to account for the funds by way of submitting expenditure returns to the Permanent Secretary at Cabinet Office,” the report stated.
The report highlighted that a review of the expenditure records for the amount above revealed that contrary to Financial Regulations numbers 45 and 52, there were several payments in amounts totaling K343, 115, 272 that were unvouched in that payment vouchers were either missing, inadequately supported or unacquitted.
“During the period from August to September 2008, amounts totaling K450, 000, 000 were paid to a filling station for the procurement of fuel to use during the funeral procession of the late President. However, there were no receipt and disposal details made available for audit,” the report disclosed.
“Contrary to Financial Regulation No. 96 which requires that imprest be retired immediately the purpose for which it was issued has been fulfilled accountable imprest totaling K729, 158, 600 issued to sixteen (16) officers in August 2008 for procurement of fuel and lubricants and for the delegation to France to bring the remains of the late President had not been retired as of December 2008.”
According to a table showing the disbursements of this accountable imprest, four officers from Cabinet Office got K521, 734, 600, four officers from Southern Province got K86, 642, 000, four officers from Copperbelt got K105, 950, 000, three officers from Eastern Province got K9, 196, 000 and one officer from Northern Province got K5, 636, 000, bringing the total to K729, 158, 600.
“A total amount of K1, 030, 904, 720 was paid to Ministry of Works and Supply to procure various goods and services for the funeral of the late President. Out of the total amount released, the ministry spent K759, 852, 000 for the procurement of mattresses, carpets, coffee tables and chairs for which no disposal details were available,” the report highlighted in part. “Out of the total of K250, 000, 000 disbursed to Central and Luapula Provinces, a total amount of K110, 000, 000 was not accounted for by the respective Provincial Administrations in Central (K10, 000, 000) and Luapula (K100, 000, 000) provinces.”
The report stated that in the case of Eastern Province the presidential funeral expenses funds were misapplied.
“A total amount of K100, 000, 000 was received by the Provincial Administration to cover for the funeral expenses. It was however observed that a total of K45, 196, 000 was applied on unrelated activities such as procurement of fuel for Kulamba ceremony and curtains for the minister’s residence among others,” the report stated.
The report stated that an examination of accounting and other records carried out at Cabinet Office, Office of the President and visits of the provinces in February 2009 revealed further accounting and other irregularities within the establishment.
“Contrary to Financial Regulations No. 45 and 52, there were fifty six (56) payments in amounts totaling K1, 528, 504, 408 that were unvouched in that the payment vouchers were either missing, inadequately supported of unaquitted,” the report stated. “Contrary to Public Stores Regulation No. 16, there were no receipt and disposal details in respect of fuel and lubricants costing K520, 532, 997 purchased during the period under review.”
The report further stated that out of K10, 940, 455, 711 issued as imprest, K442, 773, 038 had not been retired by 37 officers and that as of December 2009 no recoveries had been effected on the officers that had contravened Financial Regulation No. 96 (1).
The report’s executive summary stated that the report contains 94 paragraphs on issues that could not be resolved through the various Audit Inspection Reports (management letters) and draft annual report paragraphs.
The Auditor General’s analysis of the surplus/shortfall in revenue revealed that the net deficit in the revenue collected against the estimated amount by K1, 313, 603, 956, 045 was attributed to uncollected internal revenue amounting to K190, 503, 809, 727 and unrealised bilateral and multi-lateral grants amounting to K1, 123, 100, 146, 318.
“There was unreconciled balance of K53, 670, 974, 188 indicated in the Financial Report for which no explanation was given. It has also been observed that unreconciled balances have been appearing in the Financial Report since 2002,” the report indicated.
“A review of statement ‘C’ of the Financial Report for the year under review revealed that expenditure in excess of the provision voted by Parliament of 25 heads of expenditure amounted to K249, 973, 998, 660. The excess expenditure of K249, 973, 998, 666 is unconstitutional and will require approval by Parliament as provided for under Article 117 (5) of the Republican Constitution. The unconstitutional expenditure has increased from K192, 485, 883 in 2007 to K249, 973, 998, 666 in 2008.”
The report stated that according to Statement ‘I’ of the Financial Report for the year under review, there were unretired imprests amounting to K445, 240, 734, 515 involving 55 heads of expenditure and that included in the figure was an amount of K1, 357, 477, 316 which could not be identified with any head of expenditure.
“It was also observed that that the unretired imprest increased by 7 per cent from K417, 837, 358, 131 in 2007 to K445, 240, 734, 515,” the report stated, according to the Post.
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