PwC recommends further probe in K92bn Malawi cashgate: ‘Recover deleted database’

PricewaterhouseCoopers (PwC)Advisory Services who were working on methodologies on the reconstruction of the cashbook in the wake of audit query for the K92 billion (US$204.4 million) mismanaged under the watch of the first Democratic Progressive Party (DPP) administration led by former president the late Bingu wa Mutharika, have recommended comprehensive forensic audit.

Kamphasa: K92 billion audit query analysis will lead to forensic audit which will take approximately 10 months

Kamphasa: K92 billion audit query analysis will lead to forensic audit which will take approximately 10 months

In the 52-paged report to the National Audit Office of Malawi, PwC has called for further investigations   of ministries and departments covering the period between 2005 and 2012.

Director of PwC, Lionel Van Tonder said in the report seen by Nyasa Times that the content of the data analysis is for “information purposes only and may not form the basis of any criminal, civil, disciplinary or any other actions against any party/ies.”

The auditors recommended that the “variances” identified pertaining to the reconciliation of bank statement transactions to cashbook transactions need to be further investigated.

“The daily reconciliation performed on the Epicor system, matching electronically received bank statements to the previous day’s cashbook, needs to be reviewed. This is a potential control weakness and more comprehensive controls need to be architected to identify possible irregular transactions or ‘red flags’ as they occur,” reads part of the report recommendations.

PwC recommended that the variances of the number of transactions on the bank statement versus the number of payments on the cashbook be reviewed and that the daily reconciliation of cashbook to bank statement process also be reviewed.

“It should be considered to recover all deleted and/or modified database records in order to reconstruct the Cashbook [for the period following March 2010],” recommended PwC.

The auditors noted that the exercise will be “extremely lengthy and complex “as the Auditor General will have to work through millions of transaction logs to further understand the movements of the database.

“The complexity of this task justifies a separate submission which we will do if required,” PwC said in the report.

Identifying what they called “red flags”, PwC stated that suppliers and users created data on one day but deleted either the same day or deleted the following day.

They also pointed out that payments, vouchers and invoices were being created and deleted on the same day.

PwC states that the “anomalies should be further investigated to identify the extent of the suspected irregular transactions.”

Malawi’s Auditor General Steven Kampala said the released data analysis report is a first step towards a full forensic audit which would take approximately 10 months.

Kamphasa said the data analysis had identified discrepancies between payments made from government bank accounts and cashbook records held in the Integrated Financial Management Information System (Ifmis).

“From analysis alone it is not possible to establish exact amounts or causes of the discrepancies nor how many of these funds were misappropriated,” the Auditor General said.

Germany, one of the countries that suspended aid to Malawi after a massive public sector graft scandal in 2012 known as cashgate, granted Malawi  finances about K125 million to conduct the audit into what has been known as DPP-era cashgate

PwC continued from where British auditor Baker Tilly, who uncovered traces of cashgate, left.

‘Cashgate’ denotes the systematic skimming of millions of dollars of money from the government payment system.

Following the Cashgate revelations, donors withdrew aid and Malawi has been operating on a zero-aid budget, a situation that has caused misery to Malawians economically.

Follow and Subscribe Nyasa TV :

Please share this Article if you like Email This Post Email This Post

More From the World

Sort by:   newest | oldest | most voted
Kandapako
Guest

Anakuuzani Muluzi kuti Bingu ndi economic engineer. Ndalama zinabedwa, kuti apeze amene anaba sizitheka, mapeto ake nkhani yonse ifela mmazila. Tingoiwalapo izi apa.

mwahana
Guest

One thing comes out clear on this saga.The PLUNDERING started when Goodall Gondwe (Mtumbuka, Finance & Economic specialist) was removed from Ministry of Finance and later dropped from cabinet and replaced by Ken Lipenga (Lhomwe, English specialist with no financial knowledge). This was a deliberately hatched scheme to steal by the Mulhakho gurus DPP. Pwc get into the forensic work asap, we want names.Malawians want to know who are the thieves/plunderers/ killers of innocent souls in this nation. By the way “WHERE IS DR KEN LIPENGA?????” I have some few questions for him!!!!!!

GPMG
Guest
In German development assistance accounts it will be reported that the equivalent of MWK125 million was given to Malawi for “promoting financial transparency” when in actual fact this money has been given to South African Boers working for PwC. It would not be so painful if some useful work had been done; but in this case so much money has been spent to tell us what we already knew: The fact that our public finance system was broken and was heavily plundered mainly by the DPP regime. This is the tragedy of being poor and powerless. You are first screwed… Read more »
Snoop
Guest

As I said before, the so called K92 billion cashgate talk by opposition MP is simply HOT AIR. No basis, just barking like MAD dogs. Unfortunately, this is waht some misguided and digruntled Malawians want to hear. Political lies and envy at its best in our country!!!!!! Get a life.

MAFUMU
Guest

Akunama awo zonse taziwona kale PA BANTHU TIMES

NKHANGA ZAWONA !! NKHANGA ZAWONA !!

MALEPA
Guest

PWC ARE LIKE A HUNGRY DOG UNDER GVT DINING TABLE,EXOPECT LIES AND WHAT THEY SAY IS UTRA NOSENSE,vuto ntchito yotenoyi akupereka ku boma kuti liyang’anire;”khoswe akakhala pamkhate sapheka”okuluokulu odatero,mbava izi wina ndiuja alikunja ujo ;solupitaukamutengabwa

straight Talk
Guest
There had been audit of the same 92b by the Mw gvt in 2011 thus where the root came, why having to be redone. In the first we were told Germanyhad allocated 9b for forensic audit of 92b which was called audit query. Now its account data which seems to have same descipances and you keep on hiding the report. Show the report to the nation. I believe the same Germany or any other donor will complete the work having establish anormalies they would want to find out who did this and that. Otherwise according to the statement above mwapanga… Read more »
BONDO
Guest

Ukayenda ndi mlomwe wayenda wekha

mussa
Guest

mmmmmmmmmm dis z full of cashgate

BONDO
Guest

Iwe # 10 it is not govt money being used for the audit but Germany’s. Anzathu safuna kupanga tolerate impunity for the sake of posterity

wpDiscuz

More From Nyasatimes