Office of the Auditor General the Republic of Uganda
Total Page：16
File Type：pdf, Size：1020Kb
OFFICE OF THE AUDITOR GENERAL THE REPUBLIC OF UGANDA REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF SEMBABULE DISTRICT LOCAL GOVERNMENT FOR THE YEAR ENDED 30TH JUNE 2018 OFFICE OF THE AUDITOR GENERAL UGANDA TABLE OF CONTENTS list of Acronyms .................................................................................................. iv Opinion ............................................................................................................... 1 Basis for Opinion .................................................................................................. 1 Key Audit Matters ................................................................................................ 1 1.0 Performance of Youth Livelihood Programme ............................................... 2 1.1 Excess Funding of the Programme ............................................................... 2 1.2 Non-compliance with the repayment schedule .............................................. 3 1.3 Transfer of recovered funds to the Recovery Account in BOU ........................ 3 1.4 Inspection of Performance of Youth projects ................................................ 3 1.4.1 Kyolola Youth Cattle Fattening ............................................................... 3 1.4.2 Kiwula Youth Piggery Group .................................................................. 4 1.4.3 Lack of training of Youth Interest Groups ............................................... 4 2.0 Implementation of the Uganda Road Funds .................................................. 4 2.1 Budget Performance ................................................................................... 5 2.2 Status of Implementation ............................................................................ 5 2.2.1 Periodic maintenance ............................................................................ 6 2.2.2 Poorly installed culverts ......................................................................... 6 Emphasis of matter .............................................................................................. 7 3.0 Under-collection of Local Revenue ............................................................... 7 4.0 Unspent conditional grants .......................................................................... 8 Other Matter ........................................................................................................ 8 5.0 Disbursement of YLP Funds for the period 2017/18 ....................................... 8 Other Information ................................................................................................ 9 Management Responsibilities for the Financial Statements ...................................... 9 Auditor General’s Responsibilities for the audit of the Financial Statements ............ 10 Other Reporting Responsibilities .......................................................................... 11 REPORT ON THE AUDIT OF COMPLIANCE WITH LEGISLATION ............................ 12 6.0 Natural Resources ..................................................................................... 12 6.1 Unlicensed activities on Natural resources .................................................. 12 ii 6.2 Absence of a District Environmental Committee .......................................... 12 7.0 Capitation Grant ....................................................................................... 13 7.1 Under funding of St Joseph Matete Primary School ..................................... 13 7.2 Inadequate Infrastructure ......................................................................... 13 8.0 Status of Basic Medical Equipment ............................................................. 14 8.1 Poor Condition of Medical Equipment ......................................................... 14 APPENDICES: .............................................................................................. 16 Appendix 1: Non Compliance with Repayment schedules ................................ 16 Appendix 2: Periodic Maintenance ................................................................. 18 Appendix 3: Status of Medical Equipment ...................................................... 19 iii LIST OF ACRONYMS F/Y Financial Year GOU Government of Uganda HC Health centre IESBA International Ethics Standards Board for Accountants Code of Ethics for Professional Accountants INTOSAI International Organization of Supreme Audit Institutions ISSA International Standards on Auditing LGA Local Governments Act LGFAR Local Governments Financial and Accounting Regulations MAAIF Ministry of Agriculture, Animal Industries and Fisheries MGLSD Ministry of Gender, Labour and Social Development NAA National Audit Act NEA National Environment Act PFMA Public Finance Management Act, 2015 TAI Treasury Accounting Instructions UGX Uganda Shillings ULA Uganda Land Act URF Uganda Road Fund UWEP Uganda Women Entrepreneurship Programme YIG Youth Interest Group YLP Youth Livelihood Programme iv REPORT OF THE AUDITOR GENERAL ON THE AUDIT OF FINANCIAL STATEMENTS OF SEMBABULE DISTRICT LOCAL GOVERNMENT FOR THE YEAR ENDED 30TH JUNE, 2018 THE RT. HON. SPEAKER OF PARLIAMENT Opinion I have audited the Financial Statements of Sembabule District Local Government which comprise the Statement of Financial Position as at 30thJune 2018, and the Statement of Financial Performance, Statement of Changes in Equity and Statement of Cash Flows together with other accompanying statements for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In my opinion, the Financial Statements of Sembabule District Local Government for the year ended 30th June 2018 are prepared, in all material respects, in accordance with section 51 of the Public Finance Management, 2015 and the Local Government Financial and Accounting Manual, 2007. Basis for Opinion I conducted my audit in accordance with International Standards of Supreme Audit Institutions (ISSAIs). My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the District in accordance with the Constitution of the Republic of Uganda1995 (as amended), the National Audit Act, 2008, the International Organization of Supreme Audit Institutions (INTOSAI) Code of Ethics, the International Ethics Standards Board for Accountants Code of Ethics for Professional Accountants (Parts A and B) (IESBA Code), and other independence requirements applicable to performing audits of Financial Statements in Uganda. I have fulfilled my other ethical responsibilities in accordance with the IESBA Code, and in accordance with other ethical requirements applicable to performing audits in Uganda. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Key Audit Matters Key audit matters are those matters that, in my professional judgment, were of most significance in my audit of the Financial Statements of the current period. These matters 1 were addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters. I have determined the matter described below as the key audit matter to be communicated in my report. 1.0 Performance of Youth Livelihood Programme The Youth Livelihood Programme (YLP) is a Government Programme being imple- mented under the Ministry of Gender, Labour and Social Development (MoGLSD). The programme, which started in the financial year 2013-2014, was to respond to the existing challenge of unemployment among the Youths. The programme, which is implemented through the District provides support to the vulnerable youth in form of revolving funds for skills development projects and income generating activities initiated by youth groups. The audit focused on an amount of UGX.286,856,400 disbursed in the Financial Year; 2014/2015 whose recovery period of three years had expired by 30th June 2018. The audit procedures performed focused on ascertaining the following; Whether all funds budgeted for YLP during the period under review were actually released and used only for the program. Whether all funds advanced to the youth groups were repaid in accordance with the agreed repayment schedule and to establish reasons for failure or delays to repay the funds. Whether all funds recovered during the period under review were transferred to the revolving fund account in Bank of Uganda to be disbursed to other Youth Livelihood Groups (YLGs) in accordance with the revolving funding model and Whether on a sample basis the funded projects do exist and are operating. I made the following observations; 1.1 Excess Funding of the Programme A review of the approved budget for the YLP program revealed that whereas the District had budgeted for a total amount of UGX.226,513,400 for the financial year 2014/2015, but instead UGX.286,856,400 was released with an excess of UGX.60,343,000 which is 27% over and above what was budgeted. The Accounting Officer explained that the amount received in excess of the budget was by the MoGLSD in consideration of the cost variations for different enterprises. 2 1.2 Non-compliance with the repayment schedule It was observed that whereas the groups funded in 2014/2015 were expected to have repaid a total amount of UGX.286,856,400 (Interest exclusive)