Am I missing something?

I was going through what I think is the abridged “scope of work” of what should have been the ‘K92 billion Forensic Audit’, but which turned out to be the K577 billion forensic data analysis and cashbook reconstruction report.

Whew! We keep learning, don’t we now?

The brief scope I am referring to is outlined in the early pages of the controversial 52-page PricewaterHouseCoopers (PwC) public finance data analysis report titled Final Analysis Report: Reconstruction of the Malawi Government Cashbook for Purposes of Further Investigation covering years from January 1 2009 to December 31 2014.

From what I read, the National Audit Office (NAO) issued out two contracts: One to PwC Malawi to provide assistance pertaining to the reconstruction of the cashbook system and identifying possible ‘red flags’—very clear Terms of Reference (ToRs) for the assignment.

Once PwC has identified the ‘red flags’, then PwC Forensics, referring to PwC South African team, would provide forensic investigative services—which is the second contract—based on the potential ‘red flags’ emanating from the procedures performed by the PwC Malawi team.

Thus, these are two assignments—the first going to PwC Malawi (cashbook reconstruction) and the second to PwC South Africa team (to carry out the forensic audit based on the local office’s findings).

However, says PwC, it became clear at an early stage of the investigation that in order to secure all available electronic data, it will be necessary to image the electronic media containing the relevant data and PwC Malawi did not have the capacity to image electronic media; hence, the involvement of the SA team in the initial assignment that was specifically given to the Malawi team.

Thus, the PwC Forensic team travelled to Malawi on a number of occasions to image the servers under the control of Soft-Tech Ltd (Soft-Tech) located at the Accountant General’s office in Lilongwe.

According to the auditing firm, during these visits the PwC Forensics team inter alia met with the Auditor General (AG), Assistant AG and one Edwin Rodin-Brown, a consultant appointed by GIZ—the agency through which the German Government is funding the forensic audit—to discuss certain aspects of the investigation.

During one of these visits—if the scope part of the PwC report is anything to go by—the AG and a representative of GIZ informed PwC of the following, among other things:

• The AG wanted PwC Forensics to try and recover the lost cashbook data for the period preceding July 2010, through the imaging of the servers located at the Accountant General’s office. The firm says it managed to image the mentioned servers, and tried to recover all available data;
• The AG requested PwC Forensics to identify the individuals who worked on the Integrated Financial Management Information System (Ifmis). According to PwC, the allegation is that the persons whose name appeared on the user logs are not the actual persons who worked on the system. It is alleged that the users shared their user names and passwords. The auditors point out that this aspect will be addressed as part of their investigation into specific transactions and will not be addressed.

Now, having read all this, it occurred to me that there were two assignments here to be carried out by two sets of consults although they both fall under the PwC group—one from Malawi and the other from South Africa, but because the local team did not have certain competencies, the SA team came in to beef them up.

Of course, one can question why the report appears not to have been authored by PwC Malawi, but that is neither here nor there.

My point is that given that these are two assignments, I am not surprised that there will be two reports: one on the cashbook construction and the other on the forensic audit, which is expected to take 10 months.

Now, I am not ruling out the possibility that the report presented to Parliament may have been a watered down document. It is a real possibility.

For example, one of the Auditor General’s instructions was for PwC to identify the individuals who worked on Ifmis—and I believe that this instruction was to be carried out as part of the initial assignment—data analysis.

So, why are those names not in the report they have released and currently enjoying high vaulted public discourse?

So, yes, it is possible that this may not have been the original report. But to expect two reports—the data analysis report and the forensic audit report when the latter has not yet been conducted—at least according to PwC, NAO and the Germans—is rather strange.

Or am I missing something? A detailed look at the ToRs for the assignments could clarify a lot of things, but for now, I will look at the cold hard facts as I know them not to be as I wish they were.