Audit reveals rot at GMB
By Lloyd Mbiba, Staff Writer
Sunday, 18 March 2012 11:51
HARARE – The loss making Grain Marketing Board (GMB), is being run by
incompetent people who have contributed to its inability to sustain itself
on commercial activities, an audit report has revealed.
The audit report sent to the Comptroller and Auditor General for the year
2010 on GMB by Ruzengwe and Company (chartered accountants) has helped shed
light on how the $136 million debt-saddled parastatal is being mismanaged.
The Forensic findings of the audit revealed that the GMB board was occupied
by incompetent people who were running the institution to a halt.
“Some of the Board’s key decision making positions are occupied by officials
of questionable competency. Top management is taking no remedial action to
ensure that all board officials in the finance section are performing to
expectations. ……The finance department lacks supervision and control and
there is no timely presentation of reports to board of directors.
Incomplete, inaccurate financial reports are produced and presented,” the
report read.
GMB board consists of chairperson Charles Chikaura, Basilio Sandamu (vice
chairperson), George Magosvongwe, Sheunesu Mpepereki, Ntombana Regina Gata,
Ellen Gwaradzimba, Gift Kallisto Machengete, Ephraim Mugugu and Simon
Masanga.
The GMB wage bill is two times more than the revenue generated and the
management had no plan in place to address this anomaly, the report further
sated.
“The board’s wage bill is of $10 185 548 (for the year 2009/2010) is more
than twice the revenue generated from commercial activities ($4 079 980),
making it clearly impossible for the board to sustain itself on the revenue
from commercial activities,” reads the report.
“The Board’s plans to contain the losses are not convincing as continuation
of the current commercial activities at the current operational levels will
lead to more losses being incurred,” the report warned.
The report noted that there was no evidence to suggest that market surveys
were carried out before production of mealie meal by Centra (Private)
Limited, a contractor for the toll milling of GMB’s refined mealie meal.
Furthermore, there is poor credit control by head office, the audit
revealed. The head office is tasked with credit control according to the GMB
credit policy.
However, a $37 00 debt incurred by Mutema Brothers supermarkets from the
Masvingo depot was not reflecting in the head office nor was the debt
settled as of 2nd July 2010.
The Zimbabwe National Army Head Quarters 3 in Mutare twice bought mealie
meal form GMB valued at $12 000 on credits and this never reflected in the
head office nor was the money paid back.
The audit also discovered that the project appraisal tools were absent or
weak.
“There was no evidence to suggest that adequate project tools were in place
to help assess the profitability of commercial activities which were being
undertaken by the board.
“The board had no information for analytical procedures such as financial
reporting on specific operations/activities like milling and bakery
operations,” the audit report said.
The report said the GMB board had a penchant of making inappropriate
decisions as evidenced by Centra (private) limited toll milling contract
which was rewarded without proper considerations.
The auditors said the board’s contract overlooked legal recourse in the
event of breach of contract and the board only found out after production
commenced that the contractor had lied and was a competitor involved in the
roller meal production.
The auditors noted that there was a management deficiency especially in the
financial sector as they failed to update financial records for the current
period on the pretext that the board had outstanding audit backlog.
GMB has been torpedoed by malaises as there have been reports of losses,
debts and maize going bad.
The parastatal general manager Albert Mandizha, while appearing before
Parliament last month said GMB owes $110 million to 12 different companies
in Zambia, Malawi and South Africa who sold maize to Zimbabwe in 2007 and
2008 when there was grain shortage.
The parastatal has lost 55 000 tonnes of maize grain worth about $16 million
due to poor storage at its 44 depots and silos countrywide.
Senior government officials including cabinet ministers are accused of
having stolen government-subsidised inputs, including fertilisers meant to
benefit farmers amid reports the GMB had failed to account for grain
reserves at its depots.