Online Reporter
Sikhumbuzo Moyo, Check Point Desk
ONLY two local authorities, Goromonzi and Marondera Rural District Councils, both in Mashonaland East, have had their financial statements issued with unqualified opinions by the Auditor-General, Mrs Rheah Kujinga.
In her latest report, presented to the Minister of Finance, Economic Development and Investment Promotion, Professor Mthuli Ncube, Mrs Kujinga paints a troubling picture of the state of financial management in local authorities.
Of the audited financial statements, 64 were issued with adverse opinions, 61 with qualified opinions, while four received disclaimers.
Bulawayo City Council did not receive any opinion as it failed to submit its 2023 and 2024 accounts for audit.
According to the report, Unqualified/clean audit opinion” is financial statements that contain no material misstatements, while “Qualified audit opinion” refers to financial statements that contain material misstatements in specific amounts, or there is insufficient evidence to conclude that specific amounts included in the financial statements are not materially misstated.
For “Adverse audit opinion,” the financial statements contain material misstatements that are not confined to, or misstatements represent a substantial portion of the financial statements and “Disclaimer of opinion” means the auditor has not been able to obtain sufficient evidence to provide a basis of an audit opinion. The lack of sufficient evidence is not confined to specific amounts or represents a substantial portion of the financial statements.
Mrs Kujinga explained that the audits covered two groups of local authorities, Group A (rural district councils) and Group B (urban councils, city councils, municipalities, town councils and local boards).
She said the report covers the results of the audit of 132 financial statements of 89 local authorities and the financial statements audited comprise the statement of financial position, statement of financial performance, statement of changes in net assets, statement of cash flows, statement of comparison of budget and actual amounts and notes to the financial statements.
“The report highlights key audit findings noted during the audits and recommendations on how issues raised may be addressed to improve public sector transparency, accountability, good corporate governance and service delivery,” said the Auditor-General.
She said at the time of finalising the report and in relation to 2019, 2020, 2021, 2022, 2023 and 2024 financial years, 132 financial statements that were submitted for audit have been completed while the audits 48 financial statements were in progress and some being finalised.
The Auditor-General expressed regret that only 26 local authorities have submitted financial statements up to the financial year ended December 31, 2024, while 66 were yet to submit their financial statements for the same period.
The Auditor-General noted that many councils remain in arrears, even as they are expected to migrate smoothly to the International Public Sector Accounting Standards (IPSAS).
Mrs Kujinga said the audits looked at governance, revenue collection and debt recovery, asset management, procurement, employment costs and service delivery.
“The aspects covered are in line with the quest to promote transparency, accountability and service delivery. It is expected that the impact of addressing my findings will have a positive effect on the lives of the citizens of Zimbabwe,” she said.
According to the report, all eight city councils received qualified opinions on their financial statements. The Auditor-General expressed an adverse opinion on Harare and Gweru, but did not express any opinion on Bulawayo.
“The council’s reporting framework was not explicit as to whether it was International Public Sector Standards (IPSASs) or International Financial Reporting Standards (IFRSs). The Financial statements were prepared with reference to the Urban Councils Act (Chapter 29:15) and the Public Finance Management Act (Chapter 22:19),” said Mrs Kujinga in part of her report on Bulawayo.
“As a result, the financial statement was not suitable for other purposes. The financial statements may lack compatibility and may not be useful to users.”
Hwange and Kusile RDCs and Beitbridge Municipality’s financial statements received a disclaimer of opinion from the Auditor-General.
Mrs Kujinga said the audit report enables Parliament and those charged with public sector governance to discharge their oversight responsibilities in addressing audit findings, adding that it helps in building public trust in
Government institutions, resulting in contributing to a stable economic environment and the achievement of national development goals.
“The issues I have raised above, if not addressed, service delivery and efforts made to enhance transparency and accountability through various instruments may be compromised,” said Mrs Kujinga.
“Concerted efforts from those charged with governance is required to put in place measures to address reported weaknesses to enhance transparency, accountability, good corporate governance and service delivery.”
