At least four times every year, Zimbabwe’s State-owned enterprises compete for prime newspaper space, using the most fawning prose to mark President Robert Mugabe’s birthday and other public occasions.
Independence day, Heroes and Armed Forces days as well as Unity Day always see parastatals taking out thousands of dollars worth of commemorative advertising.
Even the year-end annual ZANU-PF conference draws some parastatals, notoriously averse to transparency, coming out to play.
Last year, power utility Zesa, with electric speed, managed the unrivalled feat of congratulating Mugabe and ZANU-PF for holding a successful conference before it had even begun!
However, with the exception of a few, these entities cower at the faintest request to publish their financial results, for the benefit of their shareholder — the benevolent Zimbabwean tax-payer who keeps bailing them out — despite perennial losses, egregious mismanagement and outright abuse of funds.
Following a series of revelations showing obscene executive pay at some parastatals and public entities such as the Premier Medical Aid Society, where State workers make up 90 percent of total membership, government launched a national governance code in 2015.
The code seeks to address problems arising from multiple directorships, concentration of corporate power in individuals, conflict of interest, executive remuneration and corporate disclosure, among other issues.
A report by the auditor general (AG) for the year-ended December 2016 shows that 45 public entities, including Air Zimbabwe, Allied Timbers, Cold Storage Company, Sabi Gold mine, Small and Medium Enterprises Development Corporation, Zimbabwe Mining Development Corporation, Zimbabwe Parks and Wildlife Management Authority, Zimpost and Zimbabwe Tourism Authority had not submitted their accounts for audit.
The AG is still waiting for Air Zimbabwe’s accounts going back to 2011.
Of the audited 78 State enterprises and parastatals, 62 got clean opinions, while 10 received qualified opinions.
The AG issued adverse opinions to three and another three entities got ‘disclaimer of opinions’.
The Agricultural and Rural Development Authority (ARDA) got adverse opinions for its accounts for 2009 and between 2011-12.
Potraz’s accounts for 2013-2016 were qualified, as were ZINARA’s for 2013-2014. Qualified audit opinions were also issued to ZIMRA (2015-16), GMB (2013-2016), Zupco (2013-2015) and ZMDC (2012-2014).
In recent years, some public entities such as NSSA and TelOne, which used to lag behind by years in their financial reporting, have not only brought their accounts up to date but have made disclosures previously unheard of.
The reforming NSSA, under investment banker Robin Vela, now provided quarterly updates in addition to their full-year reports.
The statutory pension fund’s 2016 financial statement, released early this month, made significant disclosures, including directors’ remuneration.
Similarly, TelOne’s financial reporting under Chipo Mtasa, rivals the best that the private sector can produce.
The company’s 2016 financials, published late June, also came with a detailed annual report tabled at the firm’s annual general meeting.
Publication of public entities’ financial affairs will not cure all the ills pervading the sector, but will certainly help stem some of the abuses which only come into the public consciousness once a year when the AG’s audit reports are published.
Detailed financial statements would, for instance reveal the obscene executive pay at PSMAS during Cuthbert Dube’s tenure.
They would, also show how the Minerals Marketing Corporation of Zimbabwe, where former mines secretary Francis Gudyanga ran a one-man board, made donations amounting to $3 million, above the stipulated limit of $250 000.
GMB financial statements would, hopefully, reveal how $8 million grain purchase funds were diverted to other purposes.
ZINARA statements could, possibly, reveal that the entity had made $2,1 million in expenditure with no supporting documents. Financial Gazette
