IN two consecutive years, 2022 and 2023, external auditors at the Zimbabwe National Water Authority (Zinwa) have shone light on the gross fiscal malfeasance, mismanagement and fragile accounting systems crippling the state-run enterprise.
In 2022, the external auditors, Grant Thornton, exposed irreconcilable trade payables amounting to ZW$3,9 billion (US$5,9 million) after Zinwa released its financial statements.
Following the damning revelations, which potentially exposed Zinwa to financial prejudice, the entity instituted a probe resulting in some of its workers being subjected to disciplinary hearings over allegations of financial mismanagement.
The following year, the same auditors also passed an adverse opinion on the entity, highlighting that its ZW$545,9 billion (US$92 million) revenue for 2023 could not be substantiated due to missing invoices, duplicate invoice numbers and a shambolic accounting system.
In its latest audit statement, Grant Thornton indicated that the water regulator had not taken note of the advice proffered in the previous year to strengthen its fragile accounting systems.
On its part, the Zinwa board admitted that the negative opinion passed by the auditors was a result of an out-dated enterprise resource planning system that had no capacity to meet evolving billing trends.
Keep Reading
- Sakunda hail SA stadia tour
- Rufaro Stadium refurb gathers momentum
- Huge incentives for DeMbare, Bosso
- Chiri vows to stop looting
In the absence of robust revenue control mechanisms, it is predictable that Zinwa will remain exposed to potential financial haemorrhaging.
The shambolic financial mechanism at Zinwa, whose mandate is to “provide quality water through strategic infrastructure development”, is just the tip of an iceberg of the widespread decay at most state-run enterprises.
As of July 2018, these state enterprises, most of them moribund and at an advanced stage of decline, owed the Zimbabwe Revenue Authority a staggering US$491 million.
The systematic collapse of these state entities, which used to drive economic growth while employing millions of Zimbabweans, is largely attributable to excessive political interference, corporate governance flaws, corruption and outright mismanagement.
Most of these state firms have become feeding troughs for the political elite, while some of them like the Cold Storage Company and the Zimbabwe Steel Company (Ziscosteel) have been reduced to shells.
High profile politicians and their associates have creamed off state companies with impunity.
Yet, a series of audit reports from the Office of the Auditor-General (AG) have exposed the rot plaguing these critical firms, which used to form the bedrock of Zimbabwe’s economy.
To all her credit, the former AG Mildred Chiri did a sterling job to expose the mess.
Sadly, she was just a voice in the wilderness. The government failed to support her efforts.
What needs to be done is to comprehensively quarantine these parastatals from corruption, mismanagement and political interference.
The time for action is now.