adminHarare last week.
Comptroller and Auditor-General Mrs Mildred Chiri said most of the personnel vital to the successful operation of the State-owned entities were in an acting capacity, unable to make key decisions. “Vacancies remain unfilled for a long time on the board and for key management positions,” she said. “Almost everyone is acting, and not comfortable to make decisions. They always fear for their positions. “As a result, vital decisions necessary to steer the entity are not made. This gives rise to poor transparency and poor accountability.” Mrs Chiri said parastatals should be run like private sector companies. They should have full boards, board committees and internal and external audits.
“Most parastatals do not have a nominations committee. The committee would assist the responsible minister in coming up with the names of potential candidates to fill vacant posts in a timely manner,” she said.
Ms Chiri said when there were vacancies on the board, most of the other vital committees, such as the remuneration committee and audit and risk committees could not be properly constituted.
This has resulted in poor performance by parastatals, which should contribute 40 percent of GDP. Ten have since been earmarked for privatisation, restructuring and commercialisation to enhance their performance.
“In some cases, some public entities have gone for a year or two, or even more without a substantive chief executive officer or finance director,” she said.
“As a result, financial statements are not submitted in time for audit and by the time the audit is done, audit queries are not adequately responded to because of the lapse of time and inadequate record keeping.
“Sometimes, when they are eventually submitted, the people responsible for answering questions would have left. The audit then becomes difficult.” She said parastatals should submit financials every six months, adding that most of the challenges they face are due to corporate governance deficiencies. “Corporate governance rests on the following:
Fairness, openness or transparency, independence, probity or honesty, responsibility, accountability, reputation, judgement and integrity,” said the Comptroller and Auditor-General.
Mrs Chiri added that there was need for parastatals to comply with the Corporate Governance Framework for State Enterprises and Parastatals.
The framework requires them to produce annual reports and a corporate governance report. Very few parastatals are still producing annual reports even though this was a requirement under the Public Finance Management Act.
Online Reporter