Non-submission of financial reports rife


Albertina Nakale

Windhoek-Despite government efforts to exempt all local authorities from paying audit fees, many are still failing to submit their financial statements, as required by law.

“The accounting officer of a local authority council shall within three months or such longer period as the Auditor-General may approve, after the end of a financial year of the local authority council make out financial statements in such form as may be determined by the Auditor-General in respect of that financial year and submit such financial statements to the Auditor-General,” Section 87 (1) and (2) of the Local Authorities Act of 1992 (as amended) stipulates.

The financial statements referred to in subsection (1) shall consist of a balance sheet showing the assets and liabilities of the local authority at the end of that financial year. It should also consist of a statement on income and expenditure of the local authority council for that financial year, and such other statements as may from time to time be required by the Auditor-General.

In a special report compiled by the Auditor-General Junias Kandjeke last October, he expressed serious concern over the non-submission of financial statements by some local authorities, regional councils and statutory bodies up to the 2014/2015 financial year.

He said although significant improvement had been noted since the previous report, there were a number of local authorities that still did not comply with the stipulations of the Local Authorities Act by not submitting up to date financial statements.

The municipalities he named include Karasburg Town Council, which had failed to submit between 2012/13 and 2014/15 financial years. Another defaulter is the Maltahöhe Village Council, who failed to submit during the same period.

Otjinene Village Council and Witvlei Village Council both failed to submit during the 2014/15 financial year, he said. Kandjeke said many local authorities are dependent on consultants to draw up their financial statements due to a lack of capacity.

“This is an expensive exercise, which is hardly affordable for the majority of the local authorities,” he noted. He further said the Office of the Auditor-General obtained Treasury approval to exempt all local authorities from paying audit fees for a period of five years starting on April 1, 2014.

Additionally, Kandjeke explained this is on condition that local authorities utilise the savings towards capacity building so that local authorities should be able to draw up their own financial statements by March 31, 2019.

“It is an ongoing concern of which no or little progress was made during the past financial years,” he pointed out. Since non-submission has been a serious concern, Kandjeke recommended that the line ministry develop a training programme to train staff at local authorities in the drafting of financial statements.

The regional councils that failed to submit their financial reports include Zambezi during the 2012/13, 2013/14 and 2014/15 financial years. Ohangwena Regional Council also did not comply with the stipulations of the Act by not submitting up to date financial statements during 2013/14 and 2014/15.

Kandjeke mentioned that some statutory bodies breached the law by not submitting financial statements dating as far back as 2005 up to 2014/15 financial years.

These include the National Heritage Council (2014/15), Marine Resources Fund (2012/13, 2013/14 and 2014/15), Namibia Students Financial Assistance Fund (2011/12 up to 2012/13), as well as the National Youth Service (2014/15).

Other bodies include the National Youth Council between 2013/14 and 2014/15, the Veterans Fund during 2011/12, 2012/13, 2013/14, 2014/15, while the community courts failed to submit from 2005/06 financial up until 2014/15.

Kandjeke said the non-submission of financial statements hampers the execution of his mandate and causes unnecessary delays. Another issue of concern he singled out is the increase in the number of requests to the Auditor-General by statutory bodies for extensions to submit financial statements.


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