Malawi denied justice in K577bn cashgate, delay for report scrutiny over funding

Malawi government has not funded a meeting to scrutinise the preliminary report into the forensic exercise of the government’s accounts dating back to 2009 by PricewaterHouseCoopers (PwC) with names of those suspected to be at the centre of the plunder known as K92bn DPP-era cashgate.

The data analysis report compiled by audit and business advisory firm  PricewaterHouseCoopers (PwC) titled ‘Final Analysis Report: Reconstruction of the Malawi Government Cashbook for Purposes of Further Investigation’ showed that K577 billion cannot be accounted for in the government’s bank statements between 2009 and December 2014.

The report was tabled in the National Assembly and referred to Parliament’s Public Accounts Committee (PAC) for further scrutiny and analysis before reporting back to the House.

But PAC chairperson Alekeni Menyani disclosed “ Treasury has not made any money available for such an undertaking.”

The committee is expected to meet in September.

Treasury spokesperson Nations Msowoya said Parliament would eventually arrange meetings for committees.

The chairperson of the Legal Affairs Committee of Parliament, Peter Chakwantha, accused the Democratic Progressive Party (DPP) of hiding a comprehensive audit with names of perpetrators.

Chakwantha claims government has two versions of the report, one which is a data analysis titled ‘Final Analysis Report: Reconstruction of the Malawi Government Cashbook for Purposes of Further Investigation’ and another which has names and details of what happened to payments amounting to K577 billion (US$1.3 billion) that are shown in bank statements, but cannot be traced in Capital Hill’s cashbook.

“One is the data analysis and the other is the real forensic audit report done by the PwC South African team. Now the government has chosen to feed Malawians the data analytic report version so that we all think that this is all that is on the table,” said Chakwantha.

Chakwantha lamented the mafia-like operation of the DPP to sweep under the carpet names of the culprits.

The data analysis revealed there were deliberate efforts to delete important data from the system and specifically mentioned the following suspicious actions as “red flags” requiring further investigation:

Suppliers created on one day but deleted either the same day or the following day

• Payments created and deleted on the same day;
• Invoices created and deleted on the same day;
• Vouchers created and deleted on the same day.

To arrive at the unaccounted for K577 billion, PwC says it analysed 1 788 295 bank statement payments between January 1 2009 and December 31 2014 and matched this against the total number of payment entries on the cashbook, which were found to be 1 007 075. Thus, 781 220 transactions were not accounted for in the Cashbook.

PwC, hired by the German government to work with the Auditor General’s office, assigned two teams—one from South Africa and another from the Malawi office.

Auditor General Stephenson Kamphasa said the analysis had identified significant discrepancies between payments made from government bank accounts and cashbook records held in Ifmis.

A similar forensic audit covering April to September 2013 found that K24 billion could not be accounted for in the government’s accounts.

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