AG says K92bn Bingu-era Cashgate merely ‘audit query’

The Auditor General (AG) Stepheson Kamphasa said on Saturday that his office’s  interim report on findings  of what is being christened as the “MK92 billion Cashgate” is not conclusive as it remains an audit query  as they will ascertain in the final report if  public funds were indeed lost.

As part of the K92 billion Bingu wa Mutharika-era Cashgate, the National Audit Office (NAO) named 54 firms that received about K6.3 billion in suspicious payments from the Malawi Police Service (MPS).

Some of the notable transactions whose value for money NAO could not ascertain include 17 payments to an electrical firm amounting to K1.8 billion; nine payments to another company worth about K1.2 billion; two payments of K150 million to a security equipment supplier; six payments of K123 million to a pharmaceutical firm belonging to a well-known Democratic Progressive Party (DPP) sympathiser and financier.

An analysis of the company names shows that most of the firms appearing in the Mutharika-era audit report are also featuring in the Cashgate investigations conducted since September last year.

Kamphasa: We are objective and will furnish
Kamphasa: We are professional and ethical

In both cases, civil servants appear to have connived with companies to abuse Integrated Finance Management System (IFMS) o.

“The Investigative Audit was requested by the Treasury in November 2011 under the Bingu Administration following revelations that large sums of money was allegedly found deposited into a bank account of a member of staff at the Accountant General’s Department. One of the major scopes for the investigative audit was to test and establish the strength of payments system using the Integrated Financial Management Information System commonly known as the IFMIS,” the AG said in a statement emailed to Nyasa Times.

Kamphasa said auditors assigned came across various transactions  “which at that particular time did not have any supporting documentary payments evidence such as Internal Procurement Committee (IPC)decisions to procure, vouchers and invoices which were not available for the auditors to substantiate the payments as bonafide or not. “

He added: “These preliminary findings were listed down by indicating the transaction, the recipient of payment, plus the reason for raising it as an audit query.  This does not in any way mean that the transaction or the company listed led to loss of public funds but rather gave the Auditor General a new task to call for the needed supporting evidence from the controlling officer of a particular ministry or department to avail them for acquittal.

“ This is a usual practice where the Auditor General is still pursuing outstanding audit queries.  This amount of funds which required supporting documents that had to be found amounted to MK92 billion.”

The AG explained that the K92 billion Cashgate “ remains an audit query requiring further investigation in order to substantiate the transactions validity.”

While some players in the media may portray that the list of names for the companies in the interim report of the preliminary findings are suspects believed to have defrauded government through un supported payments, the Office of the Auditor General would like to clear this misconception by concluding the audit that was already started.  Until this is done it would be grossly misleading to describe this audit query as “MK92 billion cashgate”

Kamphasa   who prides his office  for being objective in the reporting approach said: “When all the avenues have been exhausted, then the Auditor General will communicate and discuss with the relevant stakeholders including the responsible Controlling Officers and officials to ascertain that indeed public funds were lost. “

Forum for National Development (FND) national coordinator  Fryson Chodzi said Parliament and law enforcing agencies need to start by looking at all documents that relate to the cashgate especially the IFMS of 2012.

Chodzi further said that in line with the same, the plunder of public resources including properties must also be looked into by Parliament like reports of Lilongwe City Council of 2011 which highlights the plunder of houses and properties that belong to the Council which the then political leaders acquired with corruption means.

The sold houses are linked to DPP leadership who purchased them for a song when they were in power.

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