Village Councils Exempted From Paying Audit Fees – Again

ACCUMULATING debts and poor book-keeping at local councils have forced the Office of the Auditor General to once again pardon village councils from paying N$1,9 million in audit fees.

This follows yet another failure to submit timely and accurate financial statements.

Auditor General Junias Etuna Kandjeke told a stakeholders’ meeting attended by representatives of nine village councils yesterday that his office got approval from Treasury in 2008 to exempt local authorities from paying audit fees for the period 2008-2013.

Kandjeke also said they have been forced to extend the exemption for 2014-2019 because councils are still struggling to produce financial statements. He said his office had to pay the audit fees during the exemption period.

“The purpose of that exemption was clear.Local authorities should use the allocated funds for capacity building, especially in the field of compiling their own financial statements,” he said. Kandjeke further said early this year, his office conducted a survey to find out how many local authorities could honour the request.

“Quite a number of responses were received and most local authorities indicated that they could not train their staff to prepare financial statements and are still relying on consultants. Only the Swakopmund local authority indicated that it will cover its own audit fees,” he said.

The latest reports of local authorities show a number of qualified and disclaimed opinions which include bad and doubtful debts, value-added tax and employees’ tax returns, housing receivables, rates and taxes due to lack of supporting documentation, build together aances, arrears external loans and long-term liabilities.

The deputy Auditor General, Goms Menette, expressed concern over the dependency of local authorities on external financial consultants, saying it was a waste of taxpayers’ money.

Menette encouraged local authorities to train internal staff to handle financial bookkeeping competently and not rely on external auditors.

Village councils in turn said they were facing challenges of unqualified staff and lack of accountants because of low wages and said retaining financial accountants was proving to be a stumbling block.

“There is also a lack of understanding of financial statements compiled by consultants as they do not brief us on their findings after completing their audits,” said Bethany village council CEO Willie Humphries.

Representative of the Internal Audit Division at the Ministry of Regional and Local Government and Housing and Rural Development Martin Ngubai said many CEOs at village councils were depositing money and claiming travel allowance for their efforts.

Ngubai said local authorities also made payments without proper authorisation.

“Village councils are situated far from the towns, and, as a result, money is not banked regularly,” he said, adding that funds at the village councils were not used for the intended purposes and that there was a general staff shortage because of low salaries.

Ngubai suggested that the ministry should recruit qualified staff who understand financial management, and consider salary structures to attract suitable persons for crucial positions.

He said the Office of the Auditor General should come up with training programmes for councils and provide copies of audit reports to all regional councils and local authorities to the ministry for action.

The two-day briefing session was attended by ten village councils, including Bethanie, Gibeon, Gochas, Leonarille, Kamanjab, Maltahoumlhe, Koeumls and Tses.

Source : The Namibian