The report summarizes the AG's findings and recommendations on matters found during the course of financial, compliance, performance, information technology, and special audits conducted from May 2020 to April 2021.
This year the audit covered 87.8% of the reported Government Expenditure for the year ended 30 June 2020 compared to 87.1% audited last year.
Besides the State consolidated financial statements, this year OAG audited 175 individual entities, which include; six (6) GBEs, ten (10) Boards, sixty-three (63) projects, ten (10) ministries, twenty-nine (29) central government entities, thirty-one (31) local government entities, and twenty-six (26) district hospitals.
“These resulted into one hundred eighty-eight (188) audit reports (both financial and compliance), compared to one hundred eighty-one (181) in the previous years” the Auditor General said. “These individual reports support the audit opinion issued on the state consolidated financial statements” he added.
This year, in the audit of financial statements of public entities, 53% obtained unqualified audit opinion, 32% qualified audit opinion, and 15%adverse audit opinion. In compliance with laws and regulations, and value for money, 32%public entities obtained unqualified audit opinion, 38%obtained qualified audit opinion, while 30%obtained adverse audit opinion. No disclaimer opinion was expressed in either financial statements audit or compliance with laws and regulations and value for money.
The percentage of audit opinion types have shifted over time, with unqualified and qualified opinions increasing compared to adverse and disclaimer opinions.
The office also conducted nine (9) performance audits, twenty (20) special audits, and five (5) IT audits. Performance audit focused on environmental protection, expropriation, trade and industry, revenue collection, land use, agriculture, infrastructure, and education.
In the current year, irregular expenditure in form of unsupported expenditure, partially supported expenditure, wasteful expenditure, unauthorised expenditure and funds diverted or fraudulently utilised decreased by 34%. This year, such expenditure amounted to Frw 5,664,068,116 compared to Frw 8,605,923,188 in the year ended 30 June 2019.
Despite the decreasing trend, public monies and resources management in some public entities are still weak and need improvement
“Unnecessary, unlawful and wasteful expenditure should have been avoided if public entities exercised due care in their operations, coupled with prudent management of public resources,” the Auditor General said.
He also noted in his report that the level of implementation of audit recommendations has slightly increased by 3% in the current audit. 47% of recommendations were fully implemented compared to 44% implemented in the previous year 2019. It is worth noting that the percentage of fully implemented recommendations has not reached 50% in the last three years.
Some of the cross-cutting issues identified include Inadequate management review controls over financial information, exclusion of internally generated revenue and expenditure of NBAs from the national budget approved by parliament, persistent cases of delayed contracts, abandoned works not yet resumed, cases of idle assets, stalled projects, and failure to seize or recover advance payment and performance guarantees, among others.
This is the first audit report OAG has presented since the country started migrating from the Cash basis of accounting to the Accrual basis IPSAS. OAG provided inputs towards its implementation and committed to continue to monitor its implementation. Though it is in the formative stage, the Auditor General termed it “something to celebrate”.
“This framework is the only complete accounting for PFM that will enable the Government to enhance accountability and transparency in financial reporting” he said.