Malawi breaches business laws

An accounts expert has said Malawi Government has for a long time been breaching the law by not publishing its financial statements in a newspaper with high circulation in Malawi.

Society of Accountants in Malawi (Socam) chief executive officer (CEO) Daniel Dunga, making a presentation at a Malawi Law Society (MLS) conference on Saturday in Mangochi, said government’s failure to do so is in breach of Public Finance Management Act.

“These financial statements must be published in the newspapers [for transparency] according to Section 83 of the Public Finance Management Act, but have you seen them?

“Section 83 (5) of the Public Finance Management Act reads ‘The financial statements, in such summarised form as may be authorised by the minister, shall be published in the Gazette and in a newspaper with a wide circulation in Malawi,’” he said.

But spokesperson in the Ministry of Finance Nations Msowoya said due to cost implications, government posts the financial statements on its website.

Quizzed that the law clearly mentions a newspaper, Msowoya said government would consider that in future, funds permitting.

But the newly-elected MLS secretary Felisa Kilembe said in an e-mailed response that cost implications cannot be used by government to justify its failure to publish financial statements in a newspaper with a wide circulation in Malawi.

“The Act does not oblige government to publish the whole of the financial statements, but only in such summarised form as may be authorised by the minister,” she said.

Dunga, whose body has rarely confronted government on finance management, told the inquisitive lawyers at the conference it was unfortunate that professionals for a long time in Malawi have left the leadership in the wrong hands and watched as things are being messed

up.

The accounts expert also queried government’s decision to appoint an officer who was serving as an Accountant General as Auditor General, arguing that the decision is flawed because it creates a scenario where the newly-appointed Auditor General will be auditing his own accounts for the previous year.

The Socam CEO also described as bad practice a tendency where government in its financial reports paste on its website does not tell what the nation owns, the liabilities, but simply indicate what it has received and what it has spend.

The theme of the MLS annual general meeting (AGM) and the conference was Public Finance Management and Accountability: Entrenching Constitutional Values in Public Institutions.