Auditor General at pains on K92bn looting

The Auditor General (AG) on Saturday went to great length to state that government has not yet ascertained that the K92 billion allegedly stolen during former president Bingu wa Mutharika’s regime was indeed lost.

In a press statement, AG Stephenson Kamphasa regurgitated that an investigative audit was requested by Treasury in November 2011 during the first Democratic Progressive Party (DPP) power stint following revelations that large sums of money were allegedly found deposited into a bank account of an employee of the Accountant General’s Department.

Kamphasa explained that in the course of their work, 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 bona fide or not.

“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,” he said.

He further said this was a usual practice where the AG is still pursuing outstanding audit queries.

“This amount of funds, which required supporting documents that had to be found amounted to K92 billion. As of now this amount remains an audit query requiring further investigation in order to substantiate the transactions’ validity as banafide or not.

“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 ‘K92 billion Cashgate,’ reads part of the press release.

Former president Joyce Banda had asked relevant government institutions and the Public Accounts of Committee of Parliament to further scrutinise the K92 billion interim audit report.

In September 2013, government discovered that billions of money—which a British forensic audit firm later estimated to be K13 billion—may have been stolen in the space of a year that Banda was in power.

While the country was still reeling from the shock of such blatant theft, information emerged that during Bingu’s reign, as much as K92 billion may have been stolen.

According to the interim audit, the bulk of the K92 billion alleged looting took place at the ministries of Agriculture headquarters (K23.3 billion), Health headquarters (K22.2 billion), Land and Housing headquarters (K3.1 billion), Disability (K 1.3 billion), Local Government (K3.1 billion) ,Gender and Children Welfare (K934 million) and Labour headquarters (K 365) million.

The report—which was first revealed by The Nation in October last year—details how the money was allegedly lost or mismanaged through seven irregularities involving specific financial transactions.

The seven irregularities are: (1) payments that National Audit Office suspects were done “deliberately”—not for emergency reasons or technical faults as some officers claimed—outside Ifmis; (2) those without vouchers (3); those not supported with liquidation documents (4); payments made to banks without details of beneficiaries; (5) payments for purchases without Internal Procurement Committee (IPC) authority; (6) payments to suppliers for goods without evidence of delivery and (7) payments for fuel without evidence of delivery.

Of the seven irregular payments, it is the issuance of cheques without vouchers that deprived taxpayers the most, with K57 billion allegedly pilfered through this.

The probe coincided with the discovery in late 2011 of K400 million in a bank account belonging to a civil servant working for the Accountant General’s Department (AGD).

However, the DPP administration systematically discontinued the exercise before 14 more government departments/ministries were probed, suggesting that the plundered K92 billion could be small change compared to what maybe the loss if the agencies that escaped the probe were factored in.