OFFICE OF THE AUDITOR GENERAL
THE REPUBLIC OF UGANDA
UGANDA BUREAU OF STATISTICS
REPORT AND OPINION OF THE AUDITOR GENERAL ON THE FINANCIAL
STATEMENTS OF UGANDA BUREAU OF STATISTICS
FOR THE FINANCIAL YEAR ENDED 30TH JUNE 2015
OFFICE OF THE AUDITOR GENERAL
UGANDA
ii
TABLE OF CONTENTS
LIST OF ACRONYMS .................................................................................................. iii
REPORT OF THE AUDITOR GENERAL ......................................................................... 1
ON THE FINANCIAL STATEMENTS OF UGANDA BUREAU OF STATISTICS FOR THE YEAR
ENDED 30TH JUNE, 2015 ............................................................................................ 1
1.0 INTRODUCTION ............................................................................................. 4
2.0 BACKGROUND INFORMATION .......................................................................... 4
3.0 ENTITY FINANCING ........................................................................................ 4
4.0 OBJECTIVES OF THE BUREAU .......................................................................... 5
5.0 AUDIT OBJECTIVES ........................................................................................ 5
6.0 AUDIT PROCEDURES PERFORMED ................................................................... 6
7.0 AUDIT FINDINGS ............................................................................................ 6
8.0 FINANCIAL STATEMENTS .............................................................................. 20
iii
LIST OF ACRONYMS
Acronym Meaning
EFT Electronic Funds Transfer
FY Financial Year
GOU Government of Uganda
ICT Information Communication Technology
IFMS Integrated Financial Management System
IPPS Integrated Personnel Payroll System
LPOs Local Purchase Orders
MDA Ministries, Departments and Agencies
NPHC National Population and Housing Census
NSSF National Social Security Fund
OBT Output Budgeting Tool
PFMA Public Finance Management Act, 2015
PPDA Public Procurement and Disposal of Public Assets Authority
PS/ST Permanent Secretary/Secretary to the Treasury
TAIs Treasury Accounting Instructions
UBOS Uganda Bureau of Statistics
UGX Uganda Shillings
URA Uganda Revenue Authority
1
REPORT OF THE AUDITOR GENERAL
ON THE FINANCIAL STATEMENTS OF UGANDA BUREAU OF STATISTICS FOR
THE YEAR ENDED 30TH JUNE, 2015
THE RT. HON. SPEAKER OF PARLIAMENT
I have audited the financial statements of the Uganda Bureau of Statistics for the year
ended 30th June 2015. These financial statements comprise of the statement of financial
position as at 30th June 2015, statement of financial performance, statement of changes
in equity, cash flow statement together with other accompanying statements, notes and
accounting policies.
Management Responsibility for the Financial Statements
Under Article 164 of the Constitution of the Republic of Uganda, 1995 (as amended) and
Section 45 of the Public Finance Management Act (PFMA), 2015, the Accounting Officer is
accountable to Parliament for the funds and resources of the Uganda Bureau of Statistics.
The Accounting Officer is also responsible for the preparation of financial statements in
accordance with the requirements of the Public Finance Management Act 2015, and the
Financial Reporting Guide, 2008, and for such internal control as management
determines is necessary to enable the preparation of financial statements that are free
from material misstatement whether due to fraud or error.
Auditor’s Responsibility
My responsibility as required by Article 163 of the Constitution of the Republic of
Uganda,1995 (as amended), and Sections 13 and 19 of the National Audit Act, 2008 is to
audit and express an opinion on these statements based on my audit. I conducted the
audit in accordance with International Standards on Auditing (ISA). Those standards
require that I comply with the ethical requirements and plan and perform the audit to
obtain reasonable assurance whether the financial statements are free from material
misstatement.
An audit involves performing audit procedures to obtain evidence about the amounts and
disclosures in the financial statements as well as evidence supporting compliance with
relevant laws and regulations. The procedures selected depend on the Auditor’s judgment
including the assessment of risks of material misstatement of financial statements
whether due to fraud or error. In making those risk assessments, the Auditor considers
internal control relevant to the entity’s preparation and fair presentation of financial
statements in order to design audit procedures that are appropriate in the circumstances
but not for purposes of expressing an opinion on the effectiveness of the entity’s internal
2
control. An audit also includes evaluating the appropriateness of accounting policies used
and the reasonableness of accounting estimates made by management as well as
evaluating the overall presentation of the financial statements.
I believe that the audit evidence I have obtained is sufficient and appropriate to provide a
basis for my opinion.
Part “A” of this report sets out my qualified opinion on the financial statements. Part “B”
which forms an integral part of this report presents in detail all the significant audit
findings made during the audit which have been brought to the attention of management
and will form part of my Annual Report to Parliament.
PART “A”
Basis for Qualified Opinion
Mischarge of Expenditure – UGX.7,975,214,371
The Bureau charged wrong expenditure codes to a tune of UGX.7,975,214,371
thereby misstating the balances in the financial statements. This practice
undermines the importance of the budgeting process, as well as the intentions of
the appropriating authority to instil budget discipline.
Unauthorized Excess Expenditure – UGX.23,434,276,656
Contrary to Section 17 of the Public Finance and Accountability Act, 2003, an
analysis of budget estimates and the actual expenditure of the Bureau for the
financial year under review revealed an excess expenditure of
UGX.23,434,276,656 by the Bureau. This excess expenditure has not been
disclosed in the Bureau’s Statements of Appropriation for the year under review.
Doubtful Accountabilities - UGX.205,779,600
A review of accountabilities from a sample of districts revealed that a sum of
UGX.205,779,600 expended on various activities, was not properly supported. I
could not establish whether it was utilised for the intended purposes.
Funds not Accounted for – UGX.714,041,150
A review of accountabilities revealed that UGX.402,335,100 advanced to UBOS
staff through personal bank accounts to carry out various activities and another
UGX.311,706,050 advanced to various officers at the districts to carry out census
activities was not accounted for. There is uncertainty as to whether the amount in
question was properly utilised for the intended purposes.
3
Qualified Opinion
In my opinion, except for the possible effects of the matters described in the Basis for
Qualified Opinion paragraph, the financial statements of the Uganda Bureau of Statistics
for the year ended 30th June, 2015 are prepared, in all material respects, in accordance
with Section 51 of the Public Finance Management Act, 2015, and the Financial Reporting
Guide, 2008.
Other matter
Without qualifying my opinion further, I draw your attention to the following matter other
than what has been disclosed in the financial statements, which is also in part B of my
report;
Transfer of Funds to Staff Personal Accounts - UGX.10,389,500,329
An analysis of payments made during the year revealed that a sum of
UGX.10,389,500,329 was transferred to personal accounts for undertaking various
UBOS activities contrary to the requirements under the Treasury Accounting
Instruction (TAI), Sections 227, 228 and 229, which stipulate that all payments
should be made by the Accounting Officer directly to the beneficiaries.
John F.S. Muwanga
AUDITOR GENERAL
KAMPALA
21st December, 2015
4
PART "B"
DETAILED REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS
OF THE UGANDA BUREAU OF STATISTICS FOR THE FINANCIAL YEAR ENDED 30TH
JUNE, 2015
This Section outlines the detailed audit findings, management responses, and my
recommendations in respect thereof.
1.0 INTRODUCTION
Article 163 (3) of the Constitution of the Republic of Uganda, 1995 (as amended)
requires me to audit and report on the public accounts of Uganda and all public
offices including the courts, the central and local government administrations,
universities, and public institutions of the like nature and any public corporation or
other bodies or organizations established by an Act of Parliament. Accordingly, I
carried out the audit of the Uganda Bureau of Statistics (UBOS) to enable me report
to Parliament.
2.0 BACKGROUND INFORMATION
UBOS, formerly known as the Statistics Department under the Ministry of Finance,
Planning and Economic Development, was transformed into a semi-autonomous
body by the Uganda Bureau of Statistics Act No.12, 1998. The decision to establish
the Bureau arose from the need for an efficient and user-responsive agency that
would meet the growing demand for statistics on the social, economic and political
developments in the country.
The Bureau is, therefore, coordinating "the development and maintenance of a
National Statistical System which will ensure collection, analysis and dissemination of
integrated, reliable and timely statistical information.
The Bureau’s vision is “To become a Centre of excellence in statistical Production",
while its mission is “To develop a coherent, reliable, efficient and demand-driven
National Statistical System that supports management and development initiatives”.
3.0 ENTITY FINANCING
The Bureau was financed by grants from Central Government totalling to
UGX.110,580,912,601. The Bureau also collected UGX.47,068,440 in miscellaneous
revenue, bringing total revenue for the year to UGX.110,627,981,041. The Bureau
also had an opening cash balance of UGX.24,464,586,030, thus marking the total
funds available for its operations to UGX.135,092,567,071. The grants of revenue
accounted for 99% of approved estimates while the funds available constituted
5
121% of its approved budget estimates of UGX.111,556,460,695. Out of the
available funds, UGX.133,029,607,351 was spent leaving a balance of
UGX.2,081,377,607 due to the Consolidated Fund.
4.0 OBJECTIVES OF THE BUREAU
The following are the objectives of the Bureau;
To develop a coherent, reliable, efficient and demand driven UBOS Statistical
System that supports management and development initiatives through
effective "coordination and management" of the National Statistical System.
To strengthen sectoral human resource development and management
capacity for collection, analysis, dissemination and utilization of statistics.
To strengthen statistical development programmes through generating and
disseminating demand-driven statistics.
5.0 AUDIT OBJECTIVES
The audit was carried out in accordance with International Standards on Auditing
(ISAs) and accordingly included a review of the accounting records and agreed
procedures as was considered necessary. In conducting my reviews, special attention
was paid to establish whether;
a. The financial statements have been prepared in accordance with consistently
applied Accounting Policies and fairly present the revenues and expenditures
for the period and of the financial position as at the end of the period.
b. All funds were utilized with due attention to economy and efficiency and only
for the purposes for which the funds were provided.
c. Goods and services financed have been procured in accordance with the
Government of Uganda procurement regulations.
d. To evaluate and obtain a sufficient understanding of the internal control
structure of the Bureau, assess control risk and identify reportable conditions,
including material internal control weaknesses
e. Management was in compliance with the Government of Uganda financial
regulations.
f. All necessary supporting documents, records and accounts have been kept in
respect of all Bureau activities, and are in agreement with the financial
statements presented.
6
6.0 AUDIT PROCEDURES PERFORMED
The following audit procedures were undertaken;
a. Revenue
Obtained schedules of all revenues collected and reconciled the amounts to the
Bureau’s cashbooks and bank statements.
b. Expenditure
The Bureau payment vouchers were examined for proper authorization, eligibility and
budgetary provision, accountability and support documentation.
c. Internal Control System
Reviewed the internal control system and its operations to establish whether sound
controls were applied throughout the period audited.
d. Procurement
Reviewed the procurement of goods and services under the Bureau during the period
under review and reconciled with the approved procurement plan.
e. Fixed Assets Management
Reviewed the use and management of the Bureau’s assets during the period audited.
f. The Bureau’s Financial Statements
Examined, on a test basis, evidence supporting the amounts and disclosures in the
financial statements; assessed the accounting principles used and significant
estimates made by management; as well as evaluating the overall financial
statement presentation.
7.0 AUDIT FINDINGS
7.1 Categorization of findings
The following system of profiling of the audit findings has been adopted to better
prioritise the implementation of audit recommendations:
No Category Description
1 High
significance
Has a significant / material impact, has a high likelihood of
reoccurrence, and in the opinion of the Auditor General, it requires urgent remedial action. It is a matter of high risk or high stakeholder
interest.
2 Moderate
significance
Has a moderate impact, has a likelihood of reoccurrence, and in the opinion of the Auditor General, it requires remedial action. It is a
matter of medium risk or moderate stakeholder interest.
3 Low
significance
Has a low impact, has a remote likelihood of reoccurrence, and in the
opinion of the Auditor General, may not require much attention,
though its remediation may add value to the entity. It is a matter of
low risk or low stakeholder interest.
7
Accordingly, the table below contains a categorized summary of the findings that
follow in the subsequent paragraphs of the report;
Table showing categorized summary of the findings
No Finding
Significance
7.2 Mischarge of Expenditure – UGX.7, 975,214,371 High
7.3 Transfer of Funds to Staff Personal Accounts - UGX.10,389,500,329
High
7.4 Overpayment of Out-Of-Pocket Allowance To Districts Staff GX.245,003,000
Moderate
7.5 Unauthorized Excess Expenditure – UGX.23,434,276,656 High
7.6 Examination of Transactions on NPHC 12 Account (Number 003430088000011)
High
7.7 Irregularities in the Procurement of Goods and Services Moderate
7.8 Review of Districts Accountabilities High
7.9 Payroll Matters Low
7.10 Annual Board of Survey Low
7.11 Prior year Audit Issues Low
7.2 Mischarge of Expenditure – UGX.7,975,214,371
The Government Chart of Accounts defines the nature of expenditure for each item
code. The intention is to facilitate better and consistent classification of financial
transactions and also track budget performance per item.
I noted that during the year under review, a sum of UGX.7,975,214,371 was charged
on items which do not reflect the nature of the expenditure as defined per
Government Chart of Accounts. Audit attributed the circumstance to lack of
budgetary discipline by management. Notably among the most mischarged codes
were advertising and public relations with a total of UGX.3.9bn, allowances
UGX.825,677,749, and computer supplies and IT services UGX.1,303,137,933.
Mischarge of expenditure impacts on the credibility of the financial statements, since
the figures reported therein do not reflect the actual amounts expended on the
respective items. It further impacts on the appropriateness of the future budgets
since the reported actual figures are misrepresented.
Management acknowledged the observation and accordingly promised to try as much
as possible to implement as guided. I advised the Accounting Officer to ensure that
all expenditures are charged on the approved budget lines during budget execution
and always seek for reallocations in unavoidable circumstances.
8
7.3 Advances to Staff
7.3.1 Transfer of Funds to Staff Personal Accounts - UGX.10,389,500,329
Sections 227, 228 and 229 of the Treasury Accounting Instruction (TAI), require that
all payments should be made by the Accounting Officer directly to the beneficiaries.
Where this is not convenient, an imprest holder should be appointed by the
Accounting Officer with the approval of the Accountant General.
However, an analysis of payments made during the year revealed that a sum of
UGX.10,389,500,329 was transferred to personal accounts for undertaking various
UBOS activities contrary to the above provisions in the TAI.
Management in their response appreciated the level of risk involved, but also noted
that the nature of their activities is to collect data in the field and when doing so,
they mainly deal with temporarily recruited people to do the work. In their view, it
poses a higher risk to disburse these funds to temporary staff with all the allowances
to cover the long period assignments in the field in order to reduce the risk of likely
disappearance upon receipt of funds. Accordingly, the funds are disbursed to only
those staff who have been with the Bureau and/or Supervisors of the field activity.
They also noted that since the main activities of the Census have been concluded,
they intend to seek help from the Accountant General on how best they can handle
the field allowance issue without breaking the law.
I advised the Accounting Officer to always adhere to the requirements under the law,
and seek permission and/or guidance from the PS/ST where circumstances do not
permit application of the laid down guidelines.
7.3.2 Un-accounted for Funds advanced through personal bank accounts -
UGX.402,335,100
Section 217 of the TAI requires that accountabilities for funds advanced should be
submitted within 60 days from the date of payment. However, contrary to this
requirement, a total of UGX.402,335,100 advanced to staff through personal bank
accounts to carry out various activities, remained unaccounted for by the time of
audit. Under the circumstances, I could not establish whether the amounts in
question were expended for the intended purposes.
Although management had promised to provide the accountability in question, this
had not yet been availed by the time of writing this report. I have advised the
Accounting Officer to always enforce strict adherence with the financial regulations in
place in order to ensure full accountability for all funds expended. In addition, the
9
outstanding amounts should be followed up, failure of which, necessary recovery
measures ought to be instituted from the concerned staff.
7.4 Overpayment of Out-Of-Pocket Allowance To Districts Staff
UGX.245,003,000
During the training of trainers for 2014 census, the Bureau paid staff out of pocket
allowance totaling to UGX.363,803,000. However, the 450 participants were entitled
to an amount totaling to UGX.118,800,000 (calculated as 20%*120,000*11
days*450 participants). The failure to observe the correct calculation of the
allowance resulted into an overpayment of UGX.245,003,000. The excess amount
paid is recoverable.
The Accounting Officer explained that the training of trainer’s workshops involved
Census coordinators from various districts and special areas like army, police,
prisons, etc. All these participants in the country were gathered for intensive training
including field visits and the rate paid was based on the workload involved. I
however, did not find the Accounting Officer’s explanation satisfactory. I have
accordingly advised him to ensure adherence to regulations in future.
7.5 Unauthorized Excess Expenditure – UGX.23,434,276,656
Contrary to Section 17 of the Public Finance and Accountability Act, 2003, an analysis
of budget estimates and the actual expenditure of the Bureau for the financial year
under review revealed an excess expenditure of UGX.23,434,276,656 by the Bureau.
It was noted that, whereas Parliament appropriated UGX.111,556,460,695 to the
Bureau and UGX.110,580,912,601 was released by Treasury, a total of
UGX.134,990,737,351 was spent by the Bureau as seen in the table below;
Details Amount - UGX
Expenditure from TSSA 110,580,912,601
Expenditure from Field-work account 30,341,591
Expenditure from NPHC 12-Opening balance 24,379,483,159
Total 134,990,737,351
Amount appropriated 111,556,460,695
Excess Expenditure 23,434,276,656
I further noted that the above was caused by the off-budget financing of
UGX.24,434,244,439 that was kept on NPHC 12 account at the beginning of the
financial year, which was not appropriated. The Bureau has also not reflected this
10
expenditure, in its statements of appropriation, implying that the expenditure
disclosed was understated by UGX.23,434,276,656.
The practice undermines the intentions of the appropriating authority and exposes
such funds to a risk of misuse. I was not provided with evidence of any authorization
for this excess expenditure.
The Accounting Officer in his response stated that all the transactions had been
harmonized and accordingly incorporated in the financial statement.
I advised the Accounting Officer to always ensure budgetary discipline and where
circumstances do not permit, Parliamentary approval should always be sought for a
supplementary estimate, before incurring excess expenditures.
7.6 Examination of Transactions on NPHC 12 Account (Number
003430088000011)
In 2009, UBOS opened up a Uganda Bureau of Statistics - NPHC 2012 Bank Account
No.003430088000011 in Bank of Uganda (BOU). According to the account opening
documentation availed, the account was used to receive funds from development
partners for the NPHC census activities that were due to take place in 2012.
However, due to budget constraints, the Census never took place as planned, but
the account was not closed. The following observations were noted;
7.6.1 Commingling of Funds
Contrary to the initial purpose, during the financial year under review, the account
received funds from the TSSA and other project accounts. Whereas management
explained that the account was solely for census activities, we noted that funds from
this account were also paid out for none census activities. These included among
other operational expenditures like security, Statistics House repairs, annual end of
year facilitation, wellness and sports facilitation allowances, air tickets to UBOS staff,
front office flowers, demarcation of Plot 9 Colville street, all totaling to
UGX.5,986,474,376 in the year under review. These payments would have been paid
from the UBOS TSSA not from the NPHC account.
Under the circumstances, there is a risk that census funds were diverted and that the
entity was financing its operations outside the appropriated budget.
The Accounting Officer explained that the National Population and Housing Census
(NPHC) was a national program and at its implementation, the entire UBOS was
actively involved. All regular activities were scaled down and all UBOS operations
11
were all targeted to the promoting and implementation of the census. All the
identified activities including procurement of a bus, front office flowers and the face
lifting of statistics house were for the purpose of promoting the Census. Therefore all
funds to that respect were incurred to the implementation of the NPHC.
I advised the Accounting Officer to always ensure that the funds are utilized for the
intended purposes and that commingling of funds is avoided to ensure proper
accountability.
7.6.2 Transfer and utilization of funds on NPHC 12 Account
I noted that the Accounting Officer was granted authority by Treasury, to retain
unutilised funds at the closure of the FY 2013/14. Accordingly, following this
authorisation, an amount of UGX.18,315,717,031 was transferred from the Treasury
General Account (TGA) to the NPHC 12 Account, which resulted into an opening
balance of UGX.24,434,244,439 as of 1st July 2014.
I however noted that the entire balance of UGX.24,434,244,439 was erroneously
written off as expenditure during the FY 2013/14 as opposed to recognising the cash
balance on the NPHC 12 Account. I further noted that in the current year 2014/15,
whereas disclosure and presentation in the financial statements has been made in
the statement of financial performance and under note 15 of the final accounts, the
disclosure is only done as a block figure categorized as ‘other expenses’ and does not
reflect the nature of the expenditure incurred. This implies that management has not
properly presented the underlying expenditure.
The Accounting Officer explained that the National Population and Housing Census is
always categorized as a project and a disclosure as a project was made in the final
accounts of the financial year 2013/14. I advised the Accounting Officer to always
ensure that full disclosure of the Bureau’s financial transactions is made in the
financial statements.
7.6.3 Non-maintenance of ledgers for NPHC 12 account
Treasury Accounting Instruction 401 states that, “Accounts and records shall be kept
by Accounting Officers to ensure that all monies received are properly brought to
account, all payments are correctly made and properly authorized and that adequate
control is maintained over assets and liabilities. TAI 402 further clarifies that
Accounting Officers will maintain the following books or records: Cash books; Vote
Control Register (book) and General Ledger and subsidiary ledgers.
12
I observed that apart from the cash book (maintained in Ms Excel), no ledgers and
vote books were maintained for the expenditures on this account. This was contrary
to the above regulation.
I have advised the Accounting Officer to always maintain proper books of accounts
as required by the regulations.
7.6.4 Doubtful Expenditure – UGX.27,080,000
A review of payments totaling to UGX.27,080,000 revealed the following;
There were no activity reports attached for the said activities. As such, we
could not establish whether the activities were undertaken at all.
Payments for some activities were being made at UBOS headquarters directly
to District Technical Officers (DTOs) and yet funds were also being sent to
the districts for similar activities. There is a risk that some payments could
have been duplicated.
Accountabilities attached were not sufficient to show that payments reached
the intended recipients.
Under the circumstances, there is a risk that the above funds may not have been
used for the intended purposes given the nature of the accountabilities that were
submitted.
Management explained that these funds were paid to district technical officers from
headquarters to beef up the team mainly in Kampala and Wakiso because of the
staff shortages the two unique districts realized in the respective areas when the
deadline of the actual enumeration had reached. I advised the Accounting Officer to
obtain proper accountability for the funds in question or else initiate recovery
measures from the concerned beneficiaries.
7.7 Irregularities in the Procurement of Goods and Services
7.7.1 Excessive Procurement of Census Materials – UGX.786,968,769
A number of items were procured to execute census activities. I noted that some of
the items were procured in large quantities over and above the required amounts,
and as such, excess quantities remained unused in the stores valued at
UGX.786,968,769, which I considered wasteful. Most of the items were census
branded, and might never be used in the near future by UBOS. I further noted that
certain items in the store were procured without first running down the stores, for
example pens and packaging boxes would continuously be purchased irrespective of
13
the huge balances existing at the time. Furthermore, during the physical inspection
of the stores, we noted that some of the items were becoming spoilt or obsolete.
Purchase of excessive census materials is an indication that there was inadequate
assessment of the census needs which could have caused over procurements to that
magnitude.
In his response, the Accounting Officer explained that the minimum unit of
distribution to an enumerator was a questionnaire booklet of 25 households.
Questionnaires were packed in boxes of 30 questionnaires each. During the
estimation of materials, each enumerator was allocated enough books to cover all
the households in the enumeration area and each parish supervisor was allocated
the required full boxes to cover all the enumerators. The sub county supervisors
received the 10% contingency on the boxes required by the parish supervisors. This
distribution plan was designed to control quality and avoidance of shortages and
misplacement of data. He however added that the disposal process for any excess
material was under way. I noted Management’s explanation and also advised the
Accounting Officer to always exercise proper procurement planning while
undertaking procurements in order to avoid excessive procurements and wastage of
funds.
7.7.2 Stores Not Recorded – UGX.255,241,892
A physical inspection of the stores and a review of the stores documentation/records
as well as a reconciliation of receipts and issues from the stores revealed that some
item balances did not tally with the physical balances in the stores. As a result, items
valued at UGX.252,241,892 were found not recorded. I observed that the controls
surrounding the management of stores were not adequate as there were no regular
stock takings and reconciliations undertaken. There is a risk that the items in
question may have been misused without management’s knowledge.
Management in their response explained that since the receiving and arranging of
materials from districts was completed, they were now updating the stock cards for
proper documentation. By the time of completing the audit (December, 2015), the
updating exercise was ongoing.
I advised the Accounting Officer to strengthen the controls in the management of
stores and complete the store records updating exercise with a view of accounting
for all stores.
14
7.8 Review of Districts Accountabilities
7.8.1 Doubtful Accountabilities - UGX.205,779,600
Paragraph 5.6 of the Census 2014 Financial Management Guidelines requires that all
original documents relating to the census activity shall be submitted to UBOS in their
entirety at the end of the Census. In addition, paragraph 5.7 states that no
accountability will be accepted if it does not match the expenditure line items against
which it was advanced.
I reviewed accountabilities from a sample of districts and observed that a sum of
UGX.101,744,600 was incurred on various activities, but the payments were doubtful
as detailed in the table below;
DISTRICT AMOUNT - UGX
Abim 10,441,000
Adjumani 36,921,000
Masaka 54,382,600
Total 101,744,600
The accountabilities were doubted due to the following matters;
• Some of the payment vouchers lacked the necessary supporting attachments,
• Some of the accountabilities attached were inconsistent with the intended
expenditure. For example, expenditure on fuel where the dates, prices and
receipt numbers of the receipts were not in line with the activities.
• Signatures of purported beneficiaries in some instances were also
inconsistent.
• There were instances where payments were made to service providers for
services that were beyond their capacities.
In such circumstances, there is a risk of misuse of the amounts involved.
Similarly, accountabilities totalling to UGX.92,535,000 appeared to be false as
summarized in the table below;
DISTRICT AMOUNT - UGX
Ajumani 3,780,000
Arua 7,850,000
Lira 14,997,500
Moyo 4,181,500
Jinja 17,550,000
Kumi 17,726,000
Mubende 4,500,000
15
DISTRICT AMOUNT - UGX
Sembabule 4,300,000
Amuru 7,930,000
Lamwo 9,720,000
TOTAL 92,535,000
A review of the transactions relating to the above revealed the following anomalies;
• Signatures of beneficiaries of allowances paid in cash that appeared to be
made in the same handwriting;
• Where a single person would sign for funds meant for other beneficiaries
without authorization;
• Forged receipts; and
• Vehicles drawing fuel beyond there tank capacities.
I further observed instances where districts were given funds to hire venues and
other services, but instead used district facilities. From the sample, I observed that
UGX.11,500,000 (i.e. for Agago – Ugx.5,500,000 and Amuria Ugx.6,000,000) was
withdrawn and district receipts were issued. Such expenditures are irregular and
avoidable as the district is expected to use its facilities free of charge. However, this
would have been avoided had UBOS established the districts with such facilities
before budgeting for hire of similar facilities.
Management in their response acknowledged the observations.
I advised the Accounting Officer to have all the funds properly accounted for or else
initiate recovery measures for the amounts in question from the responsible officers.
7.8.2 Expenditures beyond District Budgetary Provisions
The main objective of the Census 2014 Financial Management Guidelines among
others was “To ensure compliance to budget provisions and work plans”. It was
further emphasised in the signed MoUs that all expenditure at the district level shall
be implemented as elaborated in the detailed district budgets.
Analysis of the accountabilities from the sample of districts, revealed instances where
districts spent funds beyond the amount allowed on individual budget items totalling
to UGX.81,519,100 as summarised in the table below;
Amount over spent by Districts
District Amount (UGX)
ABIM 34,578,500
16
District Amount (UGX)
BUKEDEA 9,255,500
ADJUMANI 2,120,000
NAKAPIRIPIRIT 28,264,600
ADJUMANI 2,120,000
MASAKA 5,180,500
TOTAL 81,519,100
I was not provided with evidence that the districts were authorized to spend over
and above the budgeted provisions on certain items. This tantamounts to a diversion
and implies that the other items that were budgeted for were suppressed.
Management in their response acknowledged the observations.
I advised the Accounting Officer to always ensure enforcement of the operational
guidelines issued to the districts, in order to enhance budgetary discipline.
7.8.3 Funds not Accounted for – UGX.311,706,050
Chapter IV paragraph 181 of the Treasury Accounting Instructions, 2003, Part I –
Finance, requires all vouchers to contain full particulars of each service or goods and
be accompanied by such supporting documents as may be required so as to enable
them to be checked without reference to any other documents.
From the review of accountabilities from a sample of districts, it was noted that
UGX.311,706,050 advanced to various officers at the districts to carry out census
activities was not accounted for as indicated in the table below;
DISTRICT AMOUNT (UGX)
BUKEDEA 39,516,500
ADJUMANI 53,658,600
NAMUTUMBA 2,841,000
NAKAPIRIPIRIT 3,185,000
ARUA 37,066,600
AMURIA 45,935,250
JINJA 20,557,000
KUMI 9,310,500
HOIMA 45,789,100
AMURU 2,500,000
LAMWO 8,954,000
MUBENDE 17,000,000
MASAKA 5,205,500
SEMBABULE 20,187,000
TOTAL 311,706,050
17
In absence of the relevant accountabilities, I was unable to confirm whether the
funds were put to the intended purposes.
Management in their response acknowledged the observations.
I advised the Accounting Officer to strengthen controls over advances as prescribed
under the regulations and also ensure that the funds are accounted for by the
concerned districts.
7.8.4 Non deduction of PAYE
It was noted that the districts paid honoraria and taxable allowances to various
census officials. However, contrary to the tax law, UGX.394,264,000 in lieu of PAYE,
was not deducted from these payments as summerised in the table below;
DISTRICT AMOUNT (UGX)
ADJUMANI 3,090,000
AGAGO 9,075,000
APAC 12,360,000
ARUA 119,810,000
AMURIA 14,790,000
JINJA 21,225,000
KUMI 13,935,000
NTUNGAMO 25,520,000
BULAMBULI 60,825,000
KIBAALE 3,210,000
AMURU 37,860,000
LAMWO 34,740,000
MUBENDE 32,820,000
MASAKA 5,004,000
TOTAL 394,264,000
Failure to deduct taxes exposes the entities to a risk of penalties and fines, and also
culminates into loss of Government revenue.
Management in their response acknowledged the observation. I advised the
Accounting Officer to institute recovery measures for the un-deducted amounts for
onward remittance to URA.
18
7.9 Payroll Matters
7.9.1 Duplicate payments - UGX.8,247,993
An analysis of the payment file extracted from the IFMS revealed that in the year
under audit, a total of fifteen (15) staff were paid more than one salary for the same
months during the year under review. This resulted into an over payment of
UGX.8,247,993. This implies an existence of a weak internal control mechanism
which could not prevent such occurrences.
In his response the Accounting Officer provided me with copies of refund receipts on
which all the 15 concerned staff had purportedly refunded the extra amounts paid to
them. However, there was no record that this money was banked. I advised the
Accounting Officer to ensure that all monies refunded are banked and to also
strengthen the internal controls surrounding the payroll management.
7.9.2 Over payments of salary – UGX.5,516,074
I also noted that the entity made an overpayment on salaries amounting to
UGX.5,516,074 to several staff. In his response the Accounting Officer explained that
there had been no overpayment and provided me with a schedule with revised rates
which are different from the rates that audit had obtained from the payroll on IPPS
during inspection. Audit therefore could not confirm the authenticity of the payroll
rates submitted by the entity. Besides, the new rates submitted would bring the new
entitlements to a total of UGX.16,168,495, which exceeds the original amount paid of
UGX.15,116,998, thus causing un explained difference of UGX.1,051,497.
The Accounting Officer in his response stated that the Bureau’s salary rates are
determined by the Board and therefore differ from those paid by the Civil Service.
I have advised the Accounting Officer to liaise with the responsible authorities to
reconcile the rates of on the IPSS with those of the Bureau.
7.10 Annual Board of Survey
Section 34(4) of the PFM Act 2015 requires the Accountant General at the end of the
financial year to appoint a board of survey for each vote to survey all the assets of
the vote, for the preceding year. I noted that whereas this was done, we reviewed
the report submitted to the Auditor General and this did not indicate any motor
vehicles owned by the Bureau, yet the fixed asset register indicates a number of
vehicles owned by the vote.
19
This could imply that the Board did not carry out an adequate survey exercise as
some of the Bureau’s assets were not comprehensively captured.
Management in their response acknowledged the observation and informed me that
part of the asset register that contains the vehicles will be incorporated.
7.11 Prior year Audit Issues
The following audit issues contained in my previous report were not fully addressed
by management as indicated below;
No. Audit Issue Internal Audit Comments on the Status of Implementations
1. Mischarge of expenditure
Not addressed
2. Un-accounted for cash advances to districts for census publicity
There were instances of unaccounted for advances to districts in the current year
3. Lack of title of ownership to Statistics House on Plot 9 Colville Street
The process to acquire title is slow but progressing
4. Procurements not recorded in the assets register
Repeated during the current year
5. Maintenance of an old motor vehicle fleet beyond set kilometres
The procurement of new field vehicles are underway this financial year (2015-16) and older vehicles are being disposed accordingly
6. CIS structures and management system
The draft new strategy is in place and under review
7. CIS Financial and Accountability Management System
Positive efforts to recover the CIS accountabilities has been made
8. Status of CIS equipment at District and Sub-County levels
The incorporation of the CIS equipment is awaiting the finalization of the new CIS strategy
The Accounting Officer should endeavour to address all the issues raised in the
previous audit report in order to enhance efficiency of operations, accuracy of
financial reporting and better service delivery.
20
8.0 FINANCIAL STATEMENTS
APPENDIX 1
