Report of the Auditor General for Financial Year Report Ended 31
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Report of the Auditor General for the Financial Year Ended 31 Report of the Auditor General for Financial Year Report of the Auditor General for the Financial Year 31st March 2015 Office of the Auditor General Sustainable Development Report of the Auditor General Wise-Spending for the Financial Year Ended 31st March 2015 Intergrity SPEND WISELY st March 2015 P.O. Box 98 Mbabane H100, Swaziland Old Income Tax Building Opposite the Main Treasury Building, 1st & 2nd Floor TO ACHIEVE DEVELOPMENT Talk to us @ +268 2404 2796/7 Fax to us @ +268 2404 2839 Printpak by Printed a Report of the Auditor General for the Financial Year 31st March 2015 b Report of the Auditor General for the Financial Year 31st March 2015 The Kingdom of Swaziland REPORT OF THE AUDITOR GENERAL ON THE WORK OF THE OFFICE OF THE AUDITOR GENERAL AND ON THE GOVERNMENT ACCOUNTS OF THE KINGDOM OF SWAZILAND FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2015 i Report of the Auditor General for the Financial Year 31st March 2015 The Kingdom of Swaziland Office of the Auditor General P. O. Box 98 Mbabane, H100 Swaziland Ministry of Finance P.O. Box 443 Mbabane, H100 Swaziland Your Honourable, In accordance with Section 207 (5) of the Constitution of Swaziland, I have pleasure and honour to submit my report on the Audit of the Accounts of the Government of Swaziland for the financial year ended 31st March, 2015. Yours Faithfully. P. T. Nxumalo Auditor General of the Kingdom of Swaziland ii Report of the Auditor General for the Financial Year 31st March 2015 The Speaker of the House of Assembly in Parliament C E R T I F I C A T E Report on the Financial Statements I have audited the accompanying financial statements of the Swaziland Government for the year ended 31 March 2015. These financial statements comprise the annual financial statements and the various trading accounts and the related statements of revenues and expenditures for the year then ended, and a summary of significant accounting policies and other explanatory information. Accountant General’s Responsibility The Accountant General is responsible for the preparation and fair presentation of these financial statements in accordance with Section 18 of the Finance Management and Audit Act of 1967 as amended in 1992, and for such internal control, as the Accountant General determines is necessary to enable the preparation of financial statements that are free from material misstatements, whether due to fraud or error. Auditor’s Responsibility My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with International Standards for Supreme Audit Institutions. These standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Basis for Qualified Opinion a) Misstatements of bank balances in the Consolidated Statement of Assets and Liabilities The Consolidated Statement of Assets and Liabilities, for the fiscal year ended 31st March 2015, reflected an overdrawn bank balance, of E4 850 402 356.36. This implies that Government iii Report of the Auditor General for the Financial Year 31st March 2015 operated at an overdraft during the year 2014/2015. This misstatement is supported by the presentation of overdrawn bank balances (understatement of bank balances) and the overstatement of bank balances in the financial statements. For example, the General Account depicts an overdrawn balance of E9, 060,325,660.50 at the financial year ended 31st March 2015 in the Annual Treasury Accounts, yet the bank statement shows a bank balance of E28,931, 782.83 at the Central Bank of Swaziland; and the other understated bank accounts (Teachers Account, MOF Disbursement Salaries Account, SWD Government 5yr Bond, Resettlement Advance Account, and Fuel Tax Special Account) were misstated by E4,087,490,172.10 in aggregate. While, the overstated bank balances aggregate to E7,770,726,827.59, which include Salaries Account, Cashiers Account, MOF Disbursement General Account, South African Reserve Bank, Capital Fund Account/Chinese Grant, SWD Government 3yr Bond, and PAYE Account. This confirms that the monthly bank reconciliation was not done by the Accountant General. Hence, the true position of moneys (funds) held by the Government of Swaziland in its banks, at year-end, was distorted. (b) Undisclosed/understated Revenue In the financial year ended 31st March 2015, I found that Revenue of E 1, 316, 199, 911.36 was not disclosed in the Detailed Statement of Revenue/Income Statement. The audit confirmed that the total revenue collected for the year ended 31st March 2015 was E15,176, 276, 491.85, however, E13,860,076,580.49 was reported in the Detailed Statement of Revenue. The Swaziland Revenue Authority (SRA) revenue collections, amounting to E1,230,039,786.86 was not captured in the Government Accounting System, hence, it was not disclosed in the Income Statement (Treasury Books of Accounts). The revenue received from SRA of E7,204,508,000.00 was partially captured in the Government Accounting System as E5, 974,468,213.14. This was due to the late submission of the SRA classification revenue item report to the Accountant General, which was submitted at the closing date of the Government Accounts, on 30th September 2015, which was the submission date of the accounts to the Auditor General for audit purposes. Further, dividends of E86,160,124.50 received from the Government’s shareholding investments in companies was not disclosed in the Income Statement. Qualified Opinion In my opinion, except for the possible effects of the matters described in the Basis for Qualified Opinion paragraph, the consolidated financial statements present fairly, in all material respects, the financial position of the Swaziland Government, as at 31st March 2015. Other Matters Also, my report includes matters relating to previous financial years’ budget. Due to materiality by nature and context, they are significant matters. P. T. Nxumalo Auditor General of the Kingdom of Swaziland iv Report of the Auditor General for the Financial Year 31st March 2015 TABLE OF CONTENTS PART A INTRODUCTION ......................................................................... 1 - 29 PART B MINISTRIES & DEPARTMENTS ................................................ 30 HEAD 03 Private and Cabinet Offices ........................................................ 31 HEAD 04 Tourism and Environmental Affair ................................................ 32 - 35 HEAD 05 Police ........................................................................................... 36 - 58 HEAD 06 Deputy Prime Minister’s Office .................................................... 59-60 HEAD 07 Foreign Affairs and International Cooperation ............................. 61 HEAD 08 Defence ...................................................................................... 62 HEAD 09 Tinkhundla Administration and Development ............................. 63 - 154 HEAD 10 Natural Resources and Energy ................................................... 155 - 179 HEAD 20 Agriculture ................................................................................... 180 - 188 HEAD 23 Economic Planning and Development ........................................ 189 - 197 HEAD 24 Housing and Urban Development ................................................ 198 - 202 HEAD 29 Commerce Industry and Trade ................................................... 203 - 205 HEAD 30 Education and Training ............................................................... 206 - 266 HEAD 34 Finance ....................................................................................... 267 - 276 HEAD 35 Treasury ……………………………………………......................... 277 HEAD 40 Labour and Social Security ......................................................... 278 - 283 HEAD 41 Public Service ............................................................................. 284 - 292 HEAD 43 Information, Communication and Technology ............................. 293 - 296 HEAD 45 Health ......................................................................................... 297 - 305 HEAD 46 Justice and Constitutional Affairs ................................................ 306 - 307 HEAD 48 Judiciary ....................................................................................... 308 - 316 HEAD 49 Correctional Services ..................................................................