Capital fails audit

22 November 2021 | Government

Windhoek • [email protected]

The Auditor-General, Junias Kandjeke, says there is significant uncertainty about Windhoek Municipality's solvency.
In his report for the financial years ended 30 June 2019 and 30 June 2020, he points out that the current liabilities of more than N$2.3 billion (2019: about N $ 2.4 billion), exceed the assets of about N$1.1 billion (2019: about N$1 billion) by N$1.3 billion.
In the report, Kandjeke withholds an audit opinion. This means that in a chartered accountant's terms, he cannot say with certainty that the financial statements of the Windhoek municipality do not contain material misstatements.
One of the issues is the fact that the municipality has not disclosed in the financial statements the many lawsuits against the CoW that could lead to losses of more than N$124 million. He says the possibility that the municipality will have to pay this much if the entity loses these claims.
The Auditor-General also points out that the value of properties, plant and equipment is overestimated by N$32.8 million (2019: N$34 million). This is due to the fact that the size of land and its value in the asset register differ from the values in the so-called E-planner.
Furthermore, Kandjeka is concerned about the lack of evidence that the municipality applies asset management policy with regards to the classification of land that will be sold in the ordinary course of business, or that will be developed and then sold. It appears properties that the municipality plans to sell are not listed on the asset register.
Similarly, land developed in partnership with private developers is also not listed on the asset register.
In his audit he also points to numerous other errors in the financial accounting.
Another concern is that the municipality's information systems, including those for the payment of salaries and the imposition of fines, have not been audited in the last five years to determine whether they are working properly.
Kandjeke says the financial statements submitted to him to be audited do not meet the requirements set in terms of international standards for accounting in public institutions.
These annual reports were tabled in the National Assembly (NA) last week.

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