Local authorities urged to comply with relevant financial reporting frameworks

Judith Phiri, Business Reporter

LOCAL authorities have been urged to comply with relevant financial reporting frameworks that are key to the smooth migration from the rule-based approach to the accrual-based International Public Sector Accounting Standards (IPSAS) framework by December 2025.

The adoption of IPSAS is crucial for enhancing transparency, accountability, and comparability of financial information and Zimbabwe has made significant progress towards its implementation.

The accrual-based IPSAS is focused on recognising the assets that the Government has unlike before where the country’s balance sheet only shows liabilities (domestic and foreign debt).

In a speech read on behalf of the Ministry of National Housing and Social Amenities Permanent Secretary, Engineer Theodius Chinyanga by the Chief Director Estates Development and Maintenance, Ms Kudzai Rimai, at the Urban Development Corporation (UDCORP) 2024 IPSAS and Tax Training Workshop in Bulawayo on Wednesday, he said it was critical to foster transparency and good governance in public sector financial management.

“This workshop reflects our commitment as Ministries here present and the nation at large to continue improving public finance management towards the achievement of Vision 2030 of becoming an upper-middle income economy. “This training workshop is a build-up on the earlier ones that were successfully conducted by UDCORP last year from the 2nd to the 3rd of May 2023 and another one from the 6th to the 8th of December 2023,” he said.

“The training needs continue to be identified from analysis of statutory audit reports issued by both the Auditor General’s Office and UDCORP findings when carrying out audits on local authorities and their subsidiaries.” He said serious governance lapses were noted mostly arising from non-compliance with IPSAS, tax and other regulatory requirements.

The Permanent Secretary said this was bolstered by the need for all public entities to comply with the accrual-based IPSAS Zimbabwe Financial Reporting Manual which was launched by the Minister of Finance, Economic Development and Investment Promotion, Professor Mthuli Ncube on the 24th of April 2023.

“These training sessions are vital to local authorities as they are the ones to localise Government policy. We are delighted that UDCORP is continuing to walk the talk in implementing the Government’s policy pronouncements in line with the National Development Strategy Number 1 (NDS 1) thrust and broad vision of attaining a middle-income economy by the year 2030,” added Eng Chinyanga.

“The role that UDCORP is undertaking in capacitating local council authorities to comply with relevant financial reporting frameworks and better comply with laws of the land is commendable.” He said the training workshops were also instrumental in the capacitation of local authorities’ key personnel from all departments in finance, audit, procurement, legal and environmental among others.

The Permanent Secretary said there was a need to continue building the country in the spirit of the President’s mantra “Nyika inovakwa nevene vayo.” UDCORP chief executive officer (CEO), Mr Joey Shumbamhini said, “We have noted the urgent need for implementation of the new rules in the reporting framework for local authorities as dictated by the new financing reporting manual. So, we are conducting these training workshops to align staff with new rules.”