Beyond B0T lie more deadly culprits
By Kate Meyer
When the Controller and Auditor General`s annual reports on public authorities and local and central government were released this week, media pounced on the glaring discrepancies and questionable decisions reflected in the accounting books of the Bank of Tanzania (BoT) and Tanzania National Parks Authority (TANAPA).
But beyond the culprits in the headlines, the reports revealed many more less glaring but similarly damaging examples of corruption, inefficiency and disorganisation.
In the annual report on public authorities and other bodies, released this week and dated March 26, 2009, CAG Ludovick Utouh documents hundreds of
`lesser` sins of obfuscation or omission committed by everyone from the people handling our pensions to those training our future accountants.
There`s the National Social Security Fund, which gave out 74.3m/- in bonuses and allowances without justification, and distributed more than 1.5bn/- in cheques without recording the cheques` information, such as a signature, date and cheque number, to ensure they weren’t misallocated to unintended recipients.
Then there`s Tanesco, the electricity supply company, which had differences between its monthly customer collection reports and its general ledger. In one instance, the difference was 109.2m/- and in another, it was 356.8m/-.
The CAG review also found that at the Institute of Social Work, eight cheques worth 7,761,200/- were fully signed by signatories but not dispatched to payees because they had errors.
``The cashier when interviewed said that the cheques had already been replaced with correct cheques,`` the report reads. ``This is very risky as the same cheques could be used to draw money from the accounts of the institute.``
And then there`s the Presidential Parastatal Sector Reform Commission, whose direct banking simply did not account for 691.2m/- in its books of account.
Perhaps a worrying litmus test for the country`s accountability at large, the Institute of Accountancy had trouble with its own books, the CAG report says.
The CAG found a difference of 59.5m/- between the tuition fees recording in their bank accounts and the tuition fees computed based on the number of students registered for the year.
These discrepancies may be attributable to intentional pocketing of funds, but as the report points out, many times it is hard to track the discrepancies in the first place because so many public authorities do not keep adequate records of their finances.
The Tanzania Broadcasting Corporation, for example, wants everyone to trust that they ran all the commercials they say they sold, even though they don’t seem to keep any written records of the shows and advertisements they air.
The CAG found a difference of 2.2bn/- between the broadcaster`s revenue summary from the marketing department and the summary total of invoices issued to customers by the accounting department, but with no list of programmes and ads aired, they couldn`t reconcile that difference, or gauge the accuracy and completeness of all the commercial revenue.
``Due to limitation with respect to the recording and accuracy of revenue transactions, the completeness of the programmes and commercial revenue could not be substantiated with appropriate audit evidence by using other audit procedures.
We are therefore uncertain on the completeness of the commercial revenue of 5,420,214,926/- included in the financial statements,” the report reads.
This issue of documentation is the common thread running through almost every instance of unaccounted for or misallocated funds.
TANAPA claims to has paid Sh5.9billion as compensation to Usangu villagers but no concrete evidence on whether the monies were really paid or not.
``The biggest problem that is facing the central, local and even the public authorities, centers on poor documentation,`` Utouh told The Guardian on Sunday. “That is our priority number one.``
Many authorities have problems with documentation both because they lack the technology that would streamline and digitise the process, and because they do not make it a priority, Utouh said.
Even those who have updated their documentation are still likely to be violating proper procedures for procuring goods and services, as that is still a huge problem with government and public authorities of every stripe.
Tendering process as per the Public Procurement Regulation 2005 is rarely followed correctly, according to the CAG reports, and many government and public bodies have yet to establish ‘Procurement Management Units` as required.
The CEO of the Public Procurement Regulatory Authority, Ramadhan Mlinga, told The Guardian on Sunday earlier last month that following procurement procedures continues to be a looming problem across the board, and there is not a single ministry or public authority that has made strides in becoming more transparent, efficient or attentive to procurement laws.
But the CAG calls out even the PPRA for not thoroughly reviewing monthly bank reconciliation statements to check for discrepancies - which begs the question, if everybody, including those meant to be safeguarding the country from corruption, are committing errors and not properly reviewing their financial activity, then who is auditing the auditors?
Notably, in all three reports Utouh outlines the recommendations he made in his last annual reports that have either not been implemented, or have only been partly implemented.
The CAG can only make recommendations, upon which parliamentary oversight committees can issue directives.
Utouh said that despite the slow progress and the disregarded recommendations, he wasn’t pressing for more power for auditors to make directives themselves.
``I don`t think it`s a very wise move. It’s not advisable in most cases to create a too powerful institution, and I think if anything our current system…is still a fair system of bringing sufficient accountability,`` he said.
Utouh said that although the reports consistently bring up the same issues each year, public authorities and government bodies are learning from their mistakes, and making progress.
``There are major improvements,`` he said. ``Even though the items are repeating, they are being reduced over the period. We are moving in the right direction.``
In the meantime, though, these `smaller` inconsistencies add up.
Just the suspected or unaccounted for figures used in this story alone add up to more than 5bn/-, and they represent only a slice of the discrepancies outlined in the reports.
The real scandal seems to be taking place not just in the upper chambers of the BoT or backrooms at TANAPA , but in the everyday transactions of all of the country’s public authorities.
Because the problems with accountancy and accountability are so pervasive, Utouh said people cannot expect things to change overnight.
``Wherever there are weaknesses we should not be overambitious and expect a sudden improvement,`` Utouh said. ``It`s a process - we have to change the mindset of our people. It`s really a gradual process.``