REPUBLIC OF ZAMBIA REPORT of the AUDITOR GENERAL ON THE ACCOUNTS OF THE REPUBLIC for the Financial Year Ended 31st December 2017 OFFICE OF THE AUDITOR GENERAL VISION: A dynamic audit institution that promotes transparency, accountability and prudent management of public resources. MISSION: To independently and objectively provide quality auditing services in order to assure our stakeholders that public resources are being used for national development and wellbeing of citizens. CORE VALUES: Integrity Professionalism Objectivity Teamwork Confidentiality Excellence Innovation Respect i Contents Preface .......................................................................................................................................iv Executive Summary ........................................................................................................................................ v Programme: 2011 Tax Revenue – Zambia Revenue Authority .................................................................. 11 Programme: 2021 Non Tax Revenue – Road Transport and Safety Agency .............................................. 16 Programme: 129 National Road Fund Agency ......................................................................................... 21 Programme: 2021 Non Tax Revenues – Department of Immigration ........................................................ 26 Programme: 2021 Zambia Information and Communication Technology Authority ................................. 28 Programme: 2021 - Non Tax Revenues (MPSAs) – Judiciary ..................................................................... 29 Programme: 2021 Non Tax Revenue (MPSAs) - Ministry of Lands and Natural Resources ..................... 33 Programme: 123 – Fees - Ministry of Transport and Communications ....................................................... 38 Programme: 122 Licences – Ministry of Tourism and Arts ...................................................................... 39 Programme: 123 Fees Ministry of Works and Supply .............................................................................. 43 Programme: 2021 Non Tax Revenues (Fees and Fines) – Zambia Police ................................................. 44 Head: 04 Ministry of Gender ........................................................................................................ 46 Head: 11 Zambia Police Service ................................................................................................... 49 Head: 15 Ministry of Home Affairs .............................................................................................. 51 Head: 17 Ministry of Foreign Affairs ........................................................................................... 52 Head: 17/25 Ministry of Foreign Affairs- Mission Abroad – Tokyo ................................................. 53 Head: 17/26 Ministry of Foreign Affairs – Missions Abroad - Windhoek ........................................ 57 Head: 17/27 Ministry of Foreign Affairs - Mission Abroad - Brussels ............................................. 61 Head: 17/30 Ministry of Foreign Affairs – Mission Abroad - Harare ............................................... 62 Head: 17/32 Ministry of Foreign Affairs - Missions Abroad - Geneva ............................................. 63 Head: 37 Ministry of Finance ....................................................................................................... 68 Head: 45 Ministry of Community Development and Social Services ......................................... 70 Head: 45 Ministry of Community Development and Social Services .......................................... 72 Head: 46 Ministry of Health ......................................................................................................... 80 Head: 46 Ministry of Health ......................................................................................................... 83 Head: 46 Ministry of Health ......................................................................................................... 85 Head: 54 Ministry of Housing and Infrastructure Development ................................................. 107 Head: 65 Ministry of Higher Education ...................................................................................... 109 Head: 77/01 Ministry of Defence – Headquarters ........................................................................... 119 Head: 77/02 Ministry of Defence - Zambia Army .......................................................................... 121 Head: 77/03 Ministry of Defence - Zambia Air Force ..................................................................... 123 Head: 77/04 Ministry of Defence - Zambia National Service ......................................................... 124 Head: 80 Ministry of General Education – Recurrent Departmental Charges and Capital Expenditure ................................................................................................................. 126 Head: 80 Ministry of General Education .................................................................................... 136 Head: 80 Ministry of General Education – National Implementation Framework III ................ 161 Head: 80 Ministry of General Education .................................................................................... 167 ii Head: 85 Ministry of Lands and Natural Resources ................................................................... 173 Head: 86/01 Ministry of Fisheries and Livestock - Headquarters.................................................... 175 Head: 86 Ministry of Fisheries and Livestock ............................................................................ 182 Head: 89/09 Ministry of Agriculture – Agribusiness and Marketing Department ........................... 193 Head: 89 Ministry of Agriculture ............................................................................................... 204 Head: 89 Ministry of Agriculture ............................................................................................... 207 Head: 90/01 Office of The President – Lusaka Province ................................................................. 211 Head: 90/01 Office Of The President – Lusaka Province ................................................................ 215 Head: 90/01 Office of the President – Lusaka Province .................................................................. 216 Head: 90 Office of the President - Lusaka Province ................................................................... 217 Head: 91/01 Office of the President - Copperbelt Province ............................................................. 218 Head: 91/01 Office of the President – Copperbelt Province ............................................................ 225 Head: 91/01 Office of the President – Copperbelt Province ............................................................ 229 Head: 91/01 Office of the President – Copperbelt Province ............................................................ 231 Head: 92 Office of the President – Central Province.................................................................. 233 Head: 93 Office of the President – Northern Province ............................................................... 236 Head: 94 Office of the President – Western Province ................................................................ 245 Head: 94 Office of the President – Western Province ............................................................... 252 Head: 97 Office of the President – North Western Province ...................................................... 253 Head: 98 Office of the President - Southern Province ................................................................ 256 Recommendations .................................................................................................................................... 261 Acknowledgements .................................................................................................................................... 262 Recommendations of the Public Accounts Committee ................................................................................. 262 Appendix 1 – Summary or the Status of the Unresolved Issues as at 31st December 2017 ........................... 263 Appendix 2 - Glossary of Terms .................................................................................................................... 305 iii Preface I am delighted to be able to meet the constitutional mandate of submitting the Annual Audit Report on the Accounts of the Republic of Zambia for the financial year ended 31st December 2017 as required by Article 212 of the Constitution. The Constitution gives the Auditor General the mandate to audit all public finances. In this report, I have highlighted significant audit results bordering on failure to follow legislation, Government regulations and instructions, weaknesses in internal controls resulting in failure to collect or bank revenues on time, failure to account for funds and delays in implementing projects among others. The audit covered areas that cut across all the five (5) Developmental Strategic Areas of the Seventh National Development Plan. The issues mentioned in this report are those which could not be resolved during the audit process and those which were highlighted in the previous reports, but had not been rectified at the time of producing this report.