Audit Reveals Shocking Council Scams

Audit Reveals Shocking Council Scams
Published: 2016 June 24 05:46:54 (2707 Views)
Harare City Council has launched a full scale investigation into its accounts system after revelations emerged that two ananymous computers were being used to bill customers and create fraudulent invoices for paying customers.

According to Auditor-General Mildred Chiri’s report on local authorities for 2015 which exposed corruption in most councils, the city’s IT department failed to detect the computers that were being used to generate the bills.

The same report shows that Gweru City Council failed to account for a more than $1 million loan balance and the city’s mayor and town clerk had no fuel limit while council’s senior employees were being paid holiday and education allowances outside the payroll.

The audit showed that Mutare City Council had a bank overdraft facility with FBC Bank of $4 162 154 as at December 31, 2013 for which the city paid $1 215 349 as interest and service charges.

The audit also revealed that most councils were not up-to-date with their audited financial statements and a majority of councils maintains multiple bank accounts whose reconciliations were not up to date.

In some cases, the bank balances did not reconcile to the cash book balances resulting in unexplained variances.

“Harare City Council did not reconcile its cashbook overdrawn balance of $208 430 777 as per financial statements to the bank overdraft balances of $7 590 828 giving a significant variance of $200 839 949.

“Harare City Council had weaknesses in internal controls which resulted in significant variances between the system and financial statements. Cash and bank balances, receivables and property, plant and equipment had variances of $317 254 823, $114 237 875, and $486 701 941 respectively,” reads the report.

The Auditor-General also found out several council-owned properties which were being leased but were not recorded and accounted for.

In Kwekwe among other irregularities, the audit found out that the councils’ bank reconciliation statement had an unexplained reconciling figure of $2 569 043 which could not be traced to any underlying transactions and there was a risk that the unreconciled balances may have been used to conceal irregular activities.

In Kariba, the AG was unable to confirm the accuracy, completeness and validity of receivables written off totalling $1 103 543 as council could not provide documentation that supports the write-off of debts.

In Redcliff an analysis of residential stand files showed that most of the agreements of sale were not signed and they seemed to have been prepared post allocation and terms of agreement varied depending on the initial deposits made, some of which were as low as $5.

The audit also revealed that the councils’ CBZ Bank account was in overdraft with an amount of $400 000 and municipality was unable to service it as the loan interest continued to rise.

In Norton the audit showed that the council had total employment costs of $3 108 321 out of expenditure of $5 022 069 indicating that employment costs constituted 62 percent in violation of the ministerial directive prescribing a ratio of 30:70 in favour of service delivery.

The AG said the audit findings warrant the attention of management and those charged with governance.

“The audit revealed that most of the weaknesses emanated from governance issues, revenue collection and debt recovery, employment cost and procurement of goods and services,” Ms Chiri said.

- Herald

You May Like These Videos


| Comment With Facebook Submit

There are no comments.

Big Reads

Pictures show fuel tankers offloading fuel in the bush

by Moses Zhou | 2019 August 13 07:53:37

Schoolgirl drops out after continuous 'sexual abuse' by teacher

by Staff Reporter | 2019 August 13 07:42:33

Bulawayo prostitutes dollarise

by Staff Reporter | 2018 December 01 00:43:29

DRAMA as mourners fight over deceased loan sharks' loot

by B-Metro | 2018 November 30 23:35:19

'Tsvangirai's ex' on police wanted list

by B-Metro | 2018 October 19 12:39:23

Dumped man glasses wife's face with broken beer bottle

by Staff Writer | 2018 October 19 12:32:05

Zimbabwe prostitutes hike prices

by Zimbabwe prostitutes hike prices | 2018 October 18 17:13:08

Pastor shocks female congregant with new panties

by Metro Writer | 2017 March 28 10:50:44

Harare man steals 10kg mealie meal from neighbour

by Court Reporter | 2017 March 28 07:56:29

Four company directors die in Vumba Mountain plane crash

by Staff Writer | 2017 March 28 07:38:59

Man with 'deformed' body bashes parents

by Staff Writer | 2017 March 24 09:48:46

Mugabe Knows Nothing About The Zimbabwe Constitution: MP

by Staff Reporter | 2016 October 01 08:12:02

Troubled Harare Giants Dynamos Falls Into Another Deep Crisis

by Own Correspondent | 2016 October 01 07:49:17

Shock As Local Bank Denies 'Rich' Mugabe's Son Heifty Credit

by Own Correspondent | 2016 September 30 19:14:54

Mugabe "Home Coming" And "Thank You" Rally On Cards

by Own Correspondent | 2016 September 23 06:48:24

Prof Moyo Was Dumped By Western Embassies, Claims Mutsvangwa

by Staff Reporter | 2016 September 22 10:08:07

Prof Jonathan Moyo In Fresh Beef With War Vets

by Own Correspondent | 2016 September 22 07:48:10

You Are Too Old To Lead, Aging Zim President Mugabe Told

by Own Correspondent | 2016 September 22 07:19:25

Younger Lover Beats Up Sugar Mama For Cheating

by Own Correspondent | 2016 September 20 03:21:43

Anti-Corruption Commission Loses Property In Failed Probe

by Own Correspondent | 2016 September 20 03:18:19

Mutsvangwa's Son Caught Up In Rape Case

by Own Correspondent | 2016 September 20 01:24:00


by Sports Correspondent | 2016 September 20 01:21:33

Victims Involved In Horror Crash Named

by Own Correspondent | 2016 September 20 01:16:09

Man Kills Uncle For Taking Him To Prophet

by Own Correspondent | 2016 September 20 01:11:08

Mphoko Threatens Zimra Over Irregular Taxes

by Own Correspondent | 2016 September 20 01:07:44

China Pours $46m On New Parliament Construction

by Own Correspondent | 2016 September 20 01:05:11

SHOCKING:14 Year Old HIV-Positive Boy Rapes 7 Pupils

by Own Correspondent | 2016 September 20 00:04:55

Tajamuka Slams Zimpapers, Fumes Over

by Own Correspondent | 2016 September 19 11:56:42

Mthwakazi Activists Torment Mujuru

by News Editor | 2016 September 19 10:52:58

We Did Not Fire Live Bullets: Police

by Staff Reporter | 2016 September 19 08:09:20

Ruling On 58 Protesters Expected Today 

by Court Reporter | 2016 September 19 08:10:40

6 Zanu PF Youths Nabbed For Assaulting Cops

by Court Reporter | 2016 September 19 08:11:50

Mutare Con-artist Cracks Zanu PF

by Own Correspondent | 2016 September 19 08:13:32

MSU Student Caught Peddling Drugs Tor Tuition Fees

by Own Correspondent | 2016 September 19 05:29:18

ZIMRA Dishes Out Rewards To Faithful Tax Payers

by Own Correspondent | 2016 September 19 05:24:19

Headmaster ‘Steals’ $17 000 From School's Fees

by Own Correspondent | 2016 September 19 05:21:24

Mujuru Party Fails To Pay $15 000 For Printed T-shirts

by Own Correspondent | 2016 September 19 05:14:37