BY KABELO SEITSHIRO
The Auditor General’s latest annual report on the accounts of government paints a gloomy picture of laxity in financial prudence at three parastatals ÔÇô BMC, BDC and BPC.
Topping the list is the Botswana Meat Commission (BMC) which continues to experience financial challenges in the payment of installments due on an outstanding loan of P198 337 098 for the financial year that ended 31 March 2018.
The Auditor General’s report indicates that the submission to the 56th meeting of Public Accounts Committee, the BMC accounting officer had informed the committee that a government decision had been made, in February 2018, to convert all loans to the commission into equity.
Stated in the report is that as at 31st march 2018, no accounting action had been made to clear the outstanding balance of 192 000 000 under this loan.
“The commission had not complied with all financial provisions of section 17 of BMC Act which require that, taking one year with another, its revenues should be sufficient to enable the commission to meet the outgoings properly chargeable to the revenue account in terms of section 14 of the Act,” reads the report.
Stated in the report is that the auditors drew attention to indications that the Commission reported a total deficit for the year of P242 million. Added is that accumulated losses of the Commission amounted to P1, 050 million.
“These conditions indicated the existence of a material uncertainty that casts significant doubt on the Group’s and Commission’s ability to continue as a going-concern” reads the report.
A look into the financial results the Group and Commission recorded a loss of P238.47 million and P242.15 million before revaluation loss on property, plant and equipment of P220.38 million. This is compared to a loss of P222.52 million and P204. 05 million, respectively reported in the previous year.
The expenditure of the Group declined by 6 percent from P1 405.89 million in the P1 315.55 million in the year under review, while income declined by 10 percent from P1 183.36 to P1 063.98 million during the year under review.
“The auditors noted, as in the previous that 536 animals had been in the feedlots for more than 90 days, which exposed the Commission to loss of profit since standing fees and feeding cost were incurred for each animal on a daily basis,” stated in the report.
According the report, working capital position of the Group as at 31 December 2017 showed total current assets of P222.50 million and total current liabilities of P487.90 million. This is resulting in a net current liability position of P265.40 million, while that of the commission showed current assets of P222.57 million and current liabilities of P543. 30 million giving a current liabilities position of P320.73 million.
Stated in the report is that management further highlighted that that there were instances beyond the Commission and the feed lotters’s control that sometimes resulted in cattle standing beyond the average time, such as days spent by cattle in sick pens and veterinary issues, and animals indicating that they were in wrong locations.
“The auditors noted a balance of P7.29 million in the BotswanaPost clearing account. Management stated that they engaged BotswanaPost on several occasions regarding the matter and it was not concluded. The commission had decided to engage legally to settle the dispute as it was dispute between the parties,” reads the report.
The Botswana Housing Corporation has an outstanding balance of P15 899 457. The Botswana Development Corporation owes government P58 039 319 from the construction of the GICC project valued at P189 500 000.