THE rural electrification programme has been adversely affected by the use of poor quality powerlines, resulting in most of them falling within a few years of installation.
This is contained in the Auditor-General's latest report released recently.
The rural electrification programme started in 2002 following the enactment of the Rural Electrification Fund Act and the Electricity Act.
However, a large portion of rural areas remain in darkness several years on.
“The quality of the poles used for construction of powerlines was not up to standard. As a result, there were instances of high voltage power lines falling due to the quality of the poles used,” the report read.
The report states that this resulted in Zesa Holdings incurring huge losses through replacements.
The report said there were gaps in the financial statements of the Rural Electrification Fund (REF).
The fund is meant to facilitate rapid and equitable electrification of all rural areas.
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“In my opinion, because of the significance of the matter discussed in the basis for adverse opinion section of my report, the financial statements do not present fairly the financial position of REF as at December 31, 2021, and its financial performance and cashflows for the year then ended inaccordance with International Financial Reporting Standards,” the AG’s report read.
The report said there was non-compliance with international accounting standards.
“Accounting policies, changes in accounting estimates and errors, during the prior financial years, the foreign currency-denominated transactions and balances of the fund were translated into ZWL$ using the interbank exchange rates which were notconsidered appropriate spot rates for translations as required by IAS 21 — “The Effects of Changes in Foreign Exchange Rates”.
“The fund had not aligned its governance processes to the Public Entities Corporate Governance Act [Chapter 10:31]. There was no evidence to support that the audit committeemembers had a background that demonstrates experience and expertise in finance. This was contrary to the requirements of the Public Entities Corporate Governance Act [Chapter 10:31],” the report read.
