GWANDA Municipality reportedly processed ZWL$3,74 billion outside its official payroll system, creating a glaring discrepancy with its financial statement figure of ZWL$8,21 million, according to the Auditor-General (AG)’s 2024 report on local authorities.
AG flagged the mismatch, noting that no reconciliations were done between payroll summaries and ledger records, raising doubts about the accuracy of reported payroll expenses.
“The municipality experienced system challenges, resulting in ZWL$3,74 billion being processed outside payroll. Consequently, the payroll summaries had an amount of ZWL$3,75 billion which did not agree with the financial statement amount of ZWL$8,21million,” the report read.
“No reconciliations were performed by the municipality to reconcile salaries and wages per the payroll summaries to salaries and wages per the ledger.
“I could not satisfy myself on the accuracy of payroll expenses reported in the financial statements.”
Management attributed the anomaly to system challenges, promising a solution through migration to a new enterprise resource planning system.
The audit also revealed that three municipal vehicles were not registered under the local authority’s name, with no logbooks provided for verification.
“This exposes the municipality to potential misappropriation or loss in legal disputes,” the AG warned, urging immediate registration.
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Council failed to comply with International Accounting Standard (IAS) 29, applying incorrect conversion factors to adjust financial statements for hyperinflation.
Non-monetary assets were improperly restated using yearly averages instead of acquisition dates.
AG recommended strict adherence to IAS 29 in future financial reporting.
An unresolved variance of ZWL$2,5 million was found between receivable balances totalling ZWL$20,18 million and age analysis records of ZWL$17,67 million.
“I could not satisfy myself on the accuracy of receivables reported on the financial statements,” AG noted.
AG urged monthly reconciliations to ensure accuracy.
