LOCAL AUTHORITIES - Office of the Auditor General · LOCAL AUTHORITIES . ii . ... 5.2.9....
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THE REPUBLIC OF UGANDA OFFICE OF THE AUDITOR GENERAL ANNUAL REPORT OF THE AUDITOR GENERAL FOR THE YEAR ENDED 30 TH JUNE 2015 LOCAL AUTHORITIES
Transcript of LOCAL AUTHORITIES - Office of the Auditor General · LOCAL AUTHORITIES . ii . ... 5.2.9....
THE REPUBLIC OF UGANDA
OFFICE OF THE AUDITOR GENERAL
ANNUAL REPORT OF THE AUDITOR GENERAL
FOR THE YEAR ENDED 30TH JUNE 2015
LOCAL AUTHORITIES
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Table of Contents PART I ............................................................................................................................ 1
1.0 INTRODUCTION ................................................................................................... 1
2.0 STATUS OF COMPLETION OF AUDITS .................................................................... 1
3.0 KEY AUDIT FINDINGS ........................................................................................... 3
4.0 CROSS CUTTING ISSUES IN LOCAL GOVERNMENTS ................................................ 9
PART II ..........................................................................................................................33
5.0 DETAILED REPORT OF LOCAL AUTHORITIES .........................................................33
5.1 ARUA BRANCH .............................................................................................33
5.1.1. ADJUMANI DLG .............................................................................................33
5.1.2. ARUA MC ......................................................................................................34
5.1.3. MARACHA DLG ..............................................................................................35
5.1.4. MOYO DLG ...................................................................................................37
5.1.5. MOYO TC......................................................................................................37
5.1.6. YUMBE DLG ..................................................................................................39
5.1.7. ZOMBO DLG .................................................................................................40
5.2 FORT-PORTAL BRANCH ................................................................................47
5.2.1. BUNDIBUGYO DLG ........................................................................................47
5.2.2. KARAGO TC ..................................................................................................48
5.2.3. HOIMA DLG ..................................................................................................49
5.2.4. HOIMA MC ....................................................................................................50
5.2.5. KASESE DLG .................................................................................................50
5.2.6. KAGADI TC ...................................................................................................52
5.2.7. MASINDI MC .................................................................................................53
5.2.8. KYEGEGWA DLG ............................................................................................54
5.2.9. KIRYANDONGO DLG ......................................................................................54
5.2.10. BWEYALE TC .............................................................................................55
5.2.11. KYENJOJO TC ............................................................................................56
5.2.12. KATOOKE TC .............................................................................................56
5.2.13. NTOROKO DLG ..........................................................................................58
5.3 GULU BRANCH ..............................................................................................59
5.3.1. APAC DLG .....................................................................................................59
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5.3.2. AGAGO DLG ..................................................................................................61
5.3.3. ALEBTONG DLG ............................................................................................62
5.3.4. GULU DLG ....................................................................................................62
5.3.5. KOLE DLG .....................................................................................................64
5.3.6. KITGUM DLG ................................................................................................66
5.3.7. LAMWO DLG .................................................................................................69
5.3.8. LIRA DLG ......................................................................................................70
5.3.9. PADER DLG...................................................................................................72
5.4 JINJA BRANCH .............................................................................................74
5.4.1. BUGIRI DLG ..................................................................................................74
5.4.2. BUYENDE DLG ..............................................................................................74
5.4.3. IGANGA DLG .................................................................................................78
5.4.4. IGANGA MC ..................................................................................................81
5.4.5. JINJA DLG ....................................................................................................84
5.4.6. KAMULI DLG .................................................................................................87
5.4.7 KAYUNGA DLG ..............................................................................................89
5.4.8 KAYUNGA TC ................................................................................................89
5.4.9 LUUKA DLG ...................................................................................................90
5.4.10 LUUKA TC .....................................................................................................91
5.4.11 MAYUGE DLG ................................................................................................91
5.4.12 NAMUTUMBA DLG .........................................................................................93
5.4.13 NAMAYINGO DLG ..........................................................................................95
5.5 KAMPALA BRANCH .......................................................................................97
5.5.1 BUVUMA DLG ................................................................................................97
5.5.2 GOMBA DLG .................................................................................................98
5.5.3 LUWERO DLG ...............................................................................................99
5.5.4 WOBULENZI TC .......................................................................................... 104
5.5.5 MPIGI DLG ................................................................................................. 104
5.5.6 MUKONO DLG ............................................................................................. 105
5.5.7 MUKONO MC............................................................................................... 106
5.5.8 NAKASEKE DLG ........................................................................................... 107
5.5.9 NAKASONGOLA DLG .................................................................................... 107
5.5.10 ENTEBBE MC .............................................................................................. 107
5.6 MASAKA BRANCH .......................................................................................108
5.6.1 KALANGALA DLG ......................................................................................... 108
5.6.2 KIBOGA DLG ............................................................................................... 109
5.6.3 KIBOGA TC ................................................................................................. 109
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5.6.4 LYANTONDE TC .......................................................................................... 110
5.6.5 MASAKA DLG .............................................................................................. 111
5.6.6 MITYANA DLG ............................................................................................. 111
5.6.7 MITYANA TC ............................................................................................... 112
5.6.8 MUBENDE DLG ............................................................................................ 113
5.6.9 RAKAI DLG ................................................................................................. 114
5.6.10 RAKAI TC ................................................................................................... 115
5.6.11 SEMBABULE TC ........................................................................................... 115
5.6.12 BUKOMANSIMBI TC ..................................................................................... 116
5.6.13 KALUNGU DLG ............................................................................................ 117
5.6.14 LWENGO DLG ............................................................................................. 117
5.6.15 LWENGO TC ............................................................................................... 118
5.6.16 MATEETE TC ............................................................................................... 119
5.7 MBALE BRANCH .........................................................................................121
5.7.1 BUDAKA DLG .............................................................................................. 121
5.7.2 BUDAKA TC ................................................................................................ 122
5.7.3 BUDUDA DLG .............................................................................................. 123
5.7.4 BUDUDA TC ................................................................................................ 124
5.7.5 BUKWO TC ................................................................................................. 124
5.7.6 BUSIA DLG ................................................................................................. 125
5.7.7 BUSIA MC ................................................................................................... 127
5.7.8 BUTALEJA DLG ............................................................................................ 128
5.7.9 KWEEN DLG ................................................................................................ 128
5.7.10 MANAFWA DLG ........................................................................................... 129
5.7.11 MBALE DLG................................................................................................. 130
5.7.12 SIRONKO DLG ............................................................................................. 132
5.7.13 BUDADIRI TC .............................................................................................. 133
5.7.14 TORORO DLG ............................................................................................. 134
5.7.15 TORORO MC ............................................................................................... 135
5.7.16 LWAKHAKHA TC .......................................................................................... 136
5.7.17 BULAMBULI DLG ......................................................................................... 136
5.7.18 BULAMBULI TC ........................................................................................... 138
5.7.19 BULEGENI TC .............................................................................................. 139
5.8 MBARARA BRANCH ....................................................................................139
5.8.1 BUSHENYI DLG ........................................................................................... 139
5.8.2 KABALE DLG ............................................................................................... 140
5.8.3 KATUNA TC ................................................................................................ 145
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5.8.4 HAMURWA TC ............................................................................................. 146
5.8.5 KABWOHE-ITENDERO TC ............................................................................. 147
5.8.6 KIHIHI TC................................................................................................... 148
5.8.7 KIRUHURA DLG ........................................................................................... 149
5.8.8 KISORO DLG ............................................................................................... 150
5.8.9 KISORO TC ................................................................................................. 151
5.8.10 MBARARA DLG ............................................................................................ 152
5.8.11 NTUNGAMO DLG ......................................................................................... 153
5.8.12 RWASHAMAIRE TC ...................................................................................... 158
5.8.13 RUKUNGIRI DLG ......................................................................................... 158
5.8.14 RUKUNGIRI MC ........................................................................................... 159
5.8.15 IGORORA TC .............................................................................................. 160
5.8.16 BUTOGOTA TC ............................................................................................ 160
5.8.17 SHEEMA DLG .............................................................................................. 161
5.8.18 BUGONGI TC .............................................................................................. 162
5.8.19 BUHWEJU DLG ............................................................................................ 162
5.8.20 RUBAARE TC ............................................................................................... 163
5.8.21 RUBIRIZI DLG ............................................................................................. 163
5.9 SOROTI BRANCH ........................................................................................164
5.9.1 ABIM DLG ................................................................................................... 164
5.9.2 ABIM TC ..................................................................................................... 167
5.9.3 BUKEDEA TC ............................................................................................... 169
5.9.4 KOTIDO DLG .............................................................................................. 169
5.9.5 KUMI DLG ................................................................................................... 171
5.9.6 MOROTO DLG ............................................................................................. 172
5.9.7 NAKAPIRIPIRIT TC ...................................................................................... 173
5.9.8 SOROTI DLG ............................................................................................... 173
5.9.9 SOROTI MC ................................................................................................ 174
5.9.10 NGORA DLG ................................................................................................ 176
5.9.11 NGORA TC .................................................................................................. 180
5.9.12 SERERE DLG ............................................................................................... 181
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LIST OF ACRONYMS
AO Accounting Officer
BOQs Bills of Quantity
CAO Chief Administrative Officer
CIID Criminal Investigation & Intelligence Department
DA District Administration
DC District Council
DEC District Executive Committee
DLG District Local Government
DLG District Local Government
DPAC District Public Accounts Committee
DSC District Service Commission
GOU Government of Uganda
HC I Health Centre I
HC II Health Centre II
HC III Health Centre III
HC IV Health Centre IV
HLG Higher Local Government
IAS International Accounting Standard
IDP Internally Displaced People
IFRS International Financial Reporting Standard
INTOSAI International Organization of Supreme Audit Institutions
LC I Local Council One
LC II Local Council Two
LC III Local Council Three
LC IV Local Council Four
LC V Local Council Five
LGA Local Government Act
LGBFP Local Government Budget Framework Paper
LGDP Local Government Development Programme
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LGFAM Local Government Financial and Accounting Manual
LGFAR Local Government Financial and Accounting Regulations
LGMSD Local Government Management of Service Delivery
LGPAC Local Government Public Accounts Committee
LLG Lower Local Government
LST Local Service Tax
MC Municipal Council
MoFPED Ministry of Finance Planning and Economic Development
MoLG Ministry of Local Government
MoPS Ministry of Public Service
NAA National Audit Act
NAADS National Agricultural Advisory Services
NDP National Development Plan
NSSF National Social Security Fund
OAG Office of the Auditor General
OPM Office of the Prime Minister
PAYE Pay As You Earn
PFAA Public Finance and Accountability Act
PHC
PPDA
Primary Health Care
Public Procurement and Disposal of Public Assets Authority
PFMA Public Finance Management Act
PSC Public Service Commission
PWDs People with Disabilities
SAI Supreme Audit Institution
SC Sub County
SFG School Facilitation Grant
TC Town Council
TC Town Clerk
UGX Uganda Shillings
ULGA Uganda Local Governments Association
UPE Universal Primary Education
URA Uganda Revenue Authority
URF Uganda Road Fund
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USMID Uganda Support to Municipal Infrastructure Development Program
VAT Value Added Tax
VFM Value For Money
WHT Withholding Tax
YLP Youth Livelihood Programme
IFMS Integrated Financial Management Systems
IPPS Integrated Personel and Payroll System
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Definitions
Accountant General Means the person designated under Section 3 of the Public
Finance Management Act, 2015.
Accounting Officer means a person designated under Section 3 of the Public Finance
Management Act, 2015 as Accounting Officer and Section 64(1),
65 (2) (a) and 69(2) of the Local Governments Act 1997 Cap 243
of the Laws of Uganda as amended in respect of Chief
Administrative Officer of a District, Town Clerk of an Urban
Council and Sub-county Chief and Head teachers respectively.
Auditor General Means the Auditor General appointed under article 163(1) of the
Constitution of Uganda 1995, as amended.
Adverse opinion Means an opinion issued by the Auditor General whereby the
financial statements contain material misstatements or errors and
there is disagreement with management to the extent that it is
concluded that the financial statements do not represent a fair
presentation of the financial position of the entity as at the
financial year end.
Consolidated fund Means the consolidated fund of Uganda established under article
153 of the Constitution of Uganda 1995, as amended.
Disclaimer opinion Means an opinion issued by the Auditor General whereby the
financial statements contain material misstatements based on
limitations on scope of the audit work to the extent that there is
uncertainty on the fairness and truthfulness of the financial
statements and therefore an audit opinion cannot be given
because of the gravity of the uncertainty.
Doubtful Expenditure Means expenditure that has not been confirmed as genuine
considering the circumstances under which it was incurred.
Escrow account Means an account established in the custody of a third party to
hold revenues which will be disbursed upon the fulfillment of the
conditions specified.
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Emphasis of matter Refers to a matter that does not affect the Auditor’s Opinion but
is of such fundamental importance to users in understanding of
the financial statements so as to warrant its inclusion in the
Auditor’s report immediately after the opinion.
Financial year Refers to an accounting period of twelve months.
Force on Account Means construction works undertaken by use of a procuring and
Disposing Entity’s own personnel and equipment.
Generally accepted
accounting practice
Means accounting practices and procedures recognized by the
accounting profession in Uganda and approved by the Accountant
General as appropriate for reporting financial information relating
to Government, a Ministry or department, a fund, an agency or
other reporting unit and which are consistent with the Public
Finance Managemt Act, 2015 and any other relevant
appropriation Act.
Grade X Means Pupils who did not sit exams.
Grade U Means Children who failed or Un-graded.
Government Means the Government of Uganda.
Higher Local
Governments
Refers in the context of this report, Districts, Municipal Councils
and Town Councils.
Incompletely vouched Means expenditure that is not supported by adequate
accountability documents.
Internal audit Means a process to measure, evaluate and report to the
management of an entity on the efficiency of the system of
internal control used to ensure the validity of financial and other
information.
Internal control Means a set of systems to ensure that financial and other records
are reliable, complete and ensure adherence to the entity
Management policies, orderly and efficient conduct of the entity,
proper recording and safeguarding of assets and resources.
Local Government
Council
Means a Council referred to in article 180 of the Constitution.
Nugatory Expenditure Means wasteful expenditure.
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Qualified “except for”
opinion
Refers to the audit opinion issued by the Auditor General whereby
the material misstatements or errors are not pervasive and
“except for” these misstatements or errors being adjusted for the
rest of the financial statements fairly present in all material
respects the financial position of the entity.
Unqualified opinion Refers to the audit opinion issued by the Auditor General whereby
the financial statements contained no material misstatements or
errors.
Unvouched
Expenditure
Means funds spent without preparing vouchers or expenditure
that is not supported with payment vouchers.
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PART I
1.0 INTRODUCTION
I am required by Article 163(3) of the Constitution of the Republic of Uganda 1995, (as
amended) Section 13, 16 and 19 of the National Audit Act 2008, Section 87 of the Local
Governments Act 1997 as amended and Section 51(4) of the Public Finance
Management Act 2015 to audit and report on Local Governments.
Under Section 82(4) of the Public Finance Management Act, 2015, I am now required to
submit to Parliament by 31st December annually a report of the Accounts audited by me
for the year immediately preceding. I am therefore issuing this report in accordance
with the above provisions.
Chapter 3 of this Annual Report to Parliament covers financial audits carried out on
District Local Governments, Municipal and Town Councils, Lower Local Governments,
Schools and Tertiary Institutions.
Part 1 of this chapter, I give an overview of the financial audit work carried out, status
of completion of the audits, a summary of the audit opinions issued on the financial
statements of the entities audited and the major audit findings in Local Governments
arising from the results of the audits carried out.
Part II gives the other significant audit findings on the Local Government entities
audited that need urgent attention.
I, therefore, urge all stakeholders to review this report with utmost interest and concern
to ensure effective implementation of the recommendations therein and ultimately
improve the lives of our people.
2.0 STATUS OF COMPLETION OF AUDITS
I am required to audit and report on a total of 1,786 accounts of Local Authorities,
Regional Referral Hospitals, Secondary Schools and Tertiary Institutions. I am pleased
to report that my office was able to audit and complete 1,168 accounts including all the
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307 Higher Local Governments (HLGs) and 13 Referral Hospitals, 571 Lower Local
Governments (Sub-counties) and 277 secondary schools and tertiary institutions. The
table below shows the number of entities and the audit completion status:
Table 1: Number Of Entities And Audit Completion Status
Entities
Planned Number of Entities
Accounts Audited and Pending Audits
Audited Pending
Districts 111 111 -
Municipal Councils 22 22 -
Town Councils 174 174 -
Regional Referral Hospitals 13 13 -
Sub Counties and Divisions (FY 2013/2014)
1,189 571 618
Secondary Schools/Tertiary Institutions (Year 2013 and 2014)
277 277 -
Total 1,786 1,168 618
The detailed audit reports of thirteen regional referral hospitals are included in volume 2
of my report. Audit of 1,189 sub-counties for the financial year 2014/2015 remain
outstanding due to lack of funds.
Similarly, I was only able to audit 277 secondary schools and tertiary institutions out of a
population of 1,280 schools and tertiary institutions due to limited funding provided for
the audit.
2.1 Audit Opinions
The table below shows a summary of the audit opinions of HLG for the financial year
under review including a comparison with audit opinions of the previous two years.
Table 2: Summary of Audit Opinions for the three financial years
2012/2013 2013/2014 2014/2015
Opinion1 Local Govern
ments
Percentage
Local Governm
ents
Percentage Local Governments
Percentage
Un qualified 116 37.4% 213 69.38% 279 91
Except for (qualified)
183 60% 91 29.64% 27 8.7
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Disclaimer 7 2.3% 03 0.98% 01 0.3
Adverse 0 0% 0 0% 0 0
TOTAL 307 100% 307 100% 307 100
From the table above, it is noted that unqualified opinions increased from 37.4% in
2012/2013, 69.38% in 2013/14 to 91% in 2014/15 while qualified opinions decreased
from 60% in 2012/13, 29.64% in 2013/14 to 8.7% in 2014/15. The disclaimer and
adverse opinions decreased from 2.3% in 2012/13 to 0.98% in 2013/2014 to 0.3% in
2014/2015. The above trends of opinion would suggest an improvement in the financial
management and accountability in the Local Governments.
The details of audit opinions issued for each entity regarding financial statements of
2014/15 are shown on pages 24-32.
3.0 KEY AUDIT FINDINGS
A summary of the key findings arising from the audit of Local Governments is
highlighted below:-
Lack of Consolidated Local Governments Annual Accounts
Section 52 (1) (b) of the PFM Act, 2015 requires the Accountant General within three
months after the end of the financial year to submit consolidated annual accounts of the
Local Governments.
However, contrary to the above provision, the Accountant General did not submit the
consolidated annual account of the Local Governments for audit.
Lack of a consolidated Local Government accounts denies the stakeholders financial
information for comparative analysis and decision making.
The Accountant General explained that it was not possible to consolidate the accounts
due to limited time for developing the templates, guidelines and sensitization of the
various Local Government staff that are necessary to implement the change required
under the new legislation.
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I advised the Accountant General to initiate measures for the consolidation of Local
Government accounts to comply with the law.
Overpayment of Salary
Section (B-a) (7) of the General rules on Payment of Salaries in Public Service Standing
Orders,2010 requires salaries to be paid correctly, promptly and as a lump sum in
accordance with the approved salary structure for the Public Service.
However, Payroll analysis carried out revealed that a sum of UGX.6,567,322,457 was
paid in excess of the approved salary scales to various staff.
The Accounting Officers attributed overpayments to challenges encountered during
deCentralization of salary payments on the Integrated Financial Management system
(IFMS) and Integrated Personnel and Payroll System (IPPS) and outright errors during
the salary payment process. Many of the Accounting Officers explained that they had
initiated the process of recovering the overpaid amounts. I wait for evidence to that
effect.
Procurement Anomalies
33 Local Governments procured items worth UGX. 11,493,666,328 without following
Public Procurement Regulations and Guidelines. The amount is comprised of
UGX.310,619,509 which lacked procurement files , UGX.9,937,360,405 where there was
breach of procurement procedures, UGX. 1,029,688,268 involving inadequate contract
management and UGX.215,998,1468 of unauthorized contract variations. Consequently,
it becomes difficult to ascertain whether value for money was achieved. The
shortcomings were attributed to lack of technical capacity, understaffing and deliberate
flouting of PPDA regulations. There is need for the Accounting Officers to develop
capacity building strategies and to engage the Ministry of Public Service to address the
understaffing problem. In addition Accounting Officers are encouraged to invoke the
relevant sections of the Law for noncompliance.
Funds not Accounted for
Expenditure amounting to UGX 5,524,074,947 was identified as funds unaccounted for.
Consequently, I could not confirm that the funds were utilized for the intended
purposes. The delayed submission of accountability may also lead to falsification of
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documents resulting into loss of funds. This was caused by failure of Accounting Officers
to enforce accountability controls and lack of Advances Ledger to monitor advances.
There is need for Accounting Officers to enforce controls relating to financial
management and accountability.
Under Collection of Local Revenue
Regulation 32 of the Local Governments Financial and Accounting Regulations, 2007
requires Councils to ensure collection of all budgeted revenue in an approved manner.
Review of revenue performance revealed significant under collection of Local revenue in
59 Councils amounting to UGX, 23,974,340,977.
The shortfall in revenue collection was attributed to failure to carry out revenue
enumeration and assessments, non-enforcement of contracts with private revenue
collectors, understaffing and incomplete revenue records. There seems to be little effort
in ensuring effective collection of Local revenue.
I advised the Accounting Officers to sensitize tax payers on the relevant taxes and to
develop strategies and enforce lawful measures to enhance revenue collections.
Irregular Levy of Development Tax
There were instances of irregular imposition of development tax totaling UGX.
409,672,340 on contracts by some Local Governments in a bid to enhance Local revenue
collections without approval of the Minister for Local Government contrary to the
regulations. There is a risk that such charges could compromise on quality of works and
increased costs of service delivery. The Accounting Officers explained that this was an
attempt by Councils to raise Local revenue for service delivery. There is need for the
Accounting Officers to seek for the appropriate authority prior to levying of the tax.
Understaffing
Audit revealed that the high levels of vacant posts in Local Government had not
significantly improved. The levels ranged from 14 % in Bududa District Local
Government to 87% in Luuka Town Council.
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Understaffing overstretches the available staff beyond their capacity, creates job-related
stress to the fewer staff avaliable and negatively affects the level of public service
delivery to the community.
Understaffing was attributed to limited wage bill and a ban on recruitment by the
Ministry of Public Service. The Accounting Officers are advised to continue engaging the
Ministry of Public Service, the Ministry of Local Government and the Ministry of Finance
Planning and Economic Development to address the challenge. Meanwhile Government
is advised to address this phenomenon to ensure improvements in service delivery at the
Local level.
Assets Management
Lack of Land Titles
Out of 307 Local Governments, 118 entities representing 39% of the Local Governments
lacked land titles for the land where Council properties are located. There is a risk that
Council land is exposed to encroachment and disputes which later leads to litigation in
courts of law araising from land disputes between the Councils and the Communities.
The Accounting Officers attributed this to lack of funds to process land titles and the
absence of District Land Boards. There is urgent need for the Accounting Officers to
prioritize and allocate funds and ensure that the land titles are secured. The District
Councils are also advised to ensure that the District Land Boards are constituted.
Lack of Information Communication Technology (ICT) Policy
Local Governments are making considerable investments in the Information Technology
equipment and related software without the necessary human resource and proper
procedures to manage the IT resources. I have raised this issue continuously over the
last three years. There is a risk of loss of equipment and data maintained therein.
Although the regulations require the Accounting Officers to designate an Officer to
manage the information and communication technology resources, however the
Accounting Officers are experiencing difficulties in identifying the Officers with the
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required competencies. It is recommended that the Ministry of Public Service should
review the organization structure of Local Governments to ICT personnel.
Financial Reporting
Financial Statements for Lower Local Governments
In my previous year report, I noted that there was still a problem with presentation of
financial statements in the Lower Local Governments. In the financial year under
review, the shortcomings were still identified. The anomalies include;
Non-adherence to presentation and disclosure requirements as per Local
Government Financial and accounting Manual 2007, for example, lack of cash flow
statements, schedule of commitments, and others.
Misstatement of account balances.
Non- preparation of primary books of accounts such as Ledgers, cash books, and
vote books.
Lack of Board of survey reports
Lack of Bank reconciliation statements and certificates of Bank balance.
Unbalanced Budgets
Lack of other statements, schedules and Notes to the accounts.
Missing budget figures in income and expenditure accounts.
Non-disclosure of losses.
Preparation of Financial statements is a stewardship role in which accountability for
application of resources entrusted to Accounting Officers is reported to the stakeholders.
Failure to present financial statements properly impairs interpretation and analysis of
entity performances. This is attributed to understaffing, lack of training, Low levels of
practical experience by clerks and non-adherence to the guidance provided in the Local
Governments’ Financial and Accounting Manual 2007 and other accounting standards.
Accounting Officers should liaise with responsible authorities to ensure the staffing gaps
are addressed and the necessary training undertaken.
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Lack of Standard Financial Reporting Framework for Schools
It was observed that there was no standard financial reporting framework for secondary
schools. This was attributed to lack of financial and accounting manual. As a result,
there was no uniform classification and coding of account balances, format and
presentation of financial statements. Section 29 (2) (b) of Education (Board of
Governors) regulations require the board to prepare within three months financial
statements in the form approved by the Minister or District Secretary for Education.
There is need for the Minister or District Secretary for Education to prescribe the form of
the financial statements for the Secondary Schools in consultation with the Accountant
General.
Utilized Capacity Building Infrastructure Development Funds Under
(USMID)Project
It was observed that 14 Municipal Councils under the USMID project had not fully
utilized funds released to them amounting to UGX.63,141,565,615 comprising of
capacity building funds (UGX.6,079,544,830) and infrastructure development funds
UGX.57,062,020,785.
Failure to utilize the released funds reflects lack of effective implementation of project
programs disadvantaging the community who are intended to benefit from the program.
Management attributed the low absorption of the capacity Building funds to the failure
of the Municipal Councils to procure key retooling equipment for surveying, engineering
and environment among others partly due to lack of technical capacity to procure such
specialized equipment. In addition the delay to utilise the infrastructure development
funds was attributed to failure to attract responsive bidders for the jobs.
There is need to enhance the absorption capacity to ensure full utilization of the funds
released.
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4.0 CROSS CUTTING ISSUES IN LOCAL GOVERNMENTS
The following cross cutting issues arose in the audit of Local Governments, namely:-
1. Revenue
Under collection of Local Revenue
Irregular levy of Development tax
2. Expenditure
Procurement anomalies
Funds not accounted for
Over payment of salaries
3. Internal control and Governance issues
Understaffing
Shoddy works/incomplete projects
Outstanding commitments
Lack of ICT policy
4. Assets management
Lack of land titles
Receivables
Un spent balances
Under absorption under USMID
The summary of these findings are in the table below and further detailed in table 8 on
pages 24-32.
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Table 3
AUDIT
FINDINGS FORTPORT
AL
JINJA KAMPALA MASAKA SOROTI MBALE MBARARA
Revenue
Irregular
levy of
Dev't tax
11,722,603 0 0 0 36,846,723 19,811,244 0
Expenditu
re
Internal
control
and
Governan
ce issues
Understaffi
ng46%to 58% 47% to 87% 34%- 70% 40% - 66% 22 – 80.3% 14%-71% 26%-62%
Lack of ICT
Policy4 entities 2 Entities 1 entity 5 Entities 10 Entities
Assets
managem
ent
Lack of land
titles19 entities 17 Entities 3 entities 10 entities 9 Entities
Key
Matters that require immediate action at almost no cost.
Matters that require immediate action at a low cost.
Matters that require immediate action, high cost and intervention of other stakeholder .
2,689,465,010 5,067,803,137 3,245,456,345 4,528,377,355 11,681,947,823 63,142,505,615
379,976,896 578,964,437 5,904,514,170
Un-utilized
Capacity
Building and
Infrastructu
re
Developmen
t Funds
under
(USMID
project)
4,780,442,890 7,119,004,037 21,279,231,573 2,750,777,445
Unspent
balances 91,477,502 288,894,036 1,765,395,052 2,750,777,445 49,028,802
498,275,411 70,372,992 650,970,031 1,970,365,504 156,337,165 14,602,705,594
1 entity 15 entities 10 entities 34 Entities
Receivables 475,932,609 6,365,144,394 4,415,307,488
114,164,545 240,072,606 136,827,279 3,115,454,282
5 entities
41% to 77% 20% to 77%
Outstanding
commitment
s
115,352,053 1,571,052,270 723,900,885 214,084,644
97,743,325 2,303,623,818 1,986,961,740 765,195,275 8,022,354,999
174,999,798 1,099,759,836 1,567,134,564 6,567,322,457
Unsatisfact
ory civil
works
1,562,460,312 600,009,488 706,361,041
1,040,386,060 828,148,546 5,524,074,947
Overpayme
nt of
salaries
45,008,211 792,202,445 460,097,809 62,437,379 2,314,711,035 50,971,380
9,919,000 11,493,666,328
Funds not
accounted
for
128,324,569 567,312,919 444,336,515 21,356,000 1,584,962,320 396,061,472 513,186,546
Procuremen
t anomalies1,650,770,174 3,546,240,840 639,542,697 1,257,893,736 103,661,000 464,846,214 3,820,792,667
785,717,478 794,012,515 818,849,886 3,567,380,977 23,974,340,977
79,540,437 261,751,333 409,672,340
Local
Revenue
Under-
collection
414,300,516 2,203,694,151 347,784,620 13,933,568,408 1,109,032,426
Summary of Significant Cross Cutting Issues per OAG Branch Offices
OAG REGIONAL OFFICES
ARUA GULU Total
11
4.1 REVENUE
4.1.1 Under collection of Local Revenue
Regulation 32 of the Local Governments Financial and Accounting Regulations, 2007
requires Councils to ensure collection of all budgeted revenue in an approved manner
and the revenue banked intact in Council accounts. However, a review of revenue
performance of 138 Councils revealed that under colletion of Local Revenue amounting
to UGX. 23,974,340,977.
This implies that all planned activities for the year were not implemented. This was
attributed to lack of revenue enumeration and assessment and failure to supervise
collection of contracted revenue. There is need for the Accounting Officers to carry out
revenue assessments, maintain proper revenue records, sensitize the tax payers and
strengthen controls relating to collection of revenue.
With regard to 571 Lower Local Governments (Sub Counties), an amount of UGX
1,586,709,507 remained uncollected during the period.
The shortfall in revenue collection was attributed to; failure to carry out revenue
enumeration and assessments, non-enforcement of contracts with private revenue
collectors, understaffing and incomplete revenue records. There seems to be little effort
in ensuring effective collection of these revenue sources.
I advised the Accounting Officers to sensitize tax payers and develop strategies and
enforce lawful measures to enhance revenue collection.
4.1.2 Irregular Levy of Development Tax
The Local Governments Act part IV, Other Revenues section 13 (o), requires that any
other source of revenue has to be approved by the Minister for Local Government before
its assessment and collection. However, Fourteen (14) Councils collected funds
amounting to UGX 409,672,340 in form of taxes from contracts funded by conditional
grants without the Ministers approval contrary to the law. There is a risk that such
charges could compromise on quality of works and increased costs of service delivery.
The Accounting Officers explained that this was an attempt by Councils to raise Local
12
revenue for service delivery. There is need for the Accounting Officers to seek for the
appropriate authority prior to levying of the tax.
4.2 EXPENDITURE
4.2.1 Procurement Anomalies
The Public Procurement and Disposal of Public Assets (PPDA) Act 2003, and the Local
Government PPDA Regulations 2006 require that all public procurement of goods,
services and works comply with the procurement law. However, 33 Local Governments
procured items and services worth UGX.11,493,666,328 without following Public
Procurement Regulations and guidelines as shown in the table below:
Table 4 Procurement Anomalies
Category Amount (UGX) %age
Breach of procurement procedures 9,937,360,405 86.5%
Contract management weaknesses 1,029,688,268 8.9%
Lack of procurement files and records 310,619,509 2.7%
Unauthorised contract variation 215,998,146 1.9%
Total 11,493,666,328 100%
In addition the analysis of the 571 audited sub-counties revealed that procurements
worth UGX.2,299,303,377 had irregularities related to lack of procurement records and
failure to follow the procurement procedures.
The shortcomings were attributed to lack of technical capacity, understaffing and
deliberate flouting of PPDA regulations. There is need for the Accounting Officers to
develop capacity building strategies and to engage the Ministry of Public Service to
address the understaffing problem. In addition Accounting Officers are encouraged to
invoke the relevant sections of the Law for noncompliance with the regulations.
4.2.2 Funds not Accounted For
Regulation 43 (2) of the Local Government Financial and Accounting Regulations 2007,
require Administrative advances to Council employees to be authorized by the Chief
13
Executive and accounted for within a month. During the year under review
UGX.5,524,074,947 in respect of HLGs comprising of administrative advances,
incompletely vouched expenditure, unvouched expenditure and doubtful expenditure
remained outstanding as shown in the table below:-
Table 5 Funds not accounted for
Category Amount (UGX) Percentage
Unaccounted for Administrative advances 2,440,991,267
44.2%
Incompletely vouched expenditure 1,765,173,438
32%
Missing Vouchers 1,317,910,242
23.8
Total 5,524,074,947 100%
In addition, UGX 3,364,681,447 remained outstanding in the 571 Lower Local
Governments (Sub Counties) audited as shown below;
Table 6: Funds not accounted for in 571 Lower Local Governments
Category Amount (UGX) Percentage
Incompletely vouched 556,447,976 17.5%
Unaccounted for expenditure 160,909,108 5.1%
Unvouched expenditure 653,359,179 20.5%
Outstanding administrative advances 1,810,370,086 56.9%
Total 3,181,086,349 100%
Consequently, I could not confirm that the funds were utilized for the intended
purposes. The delayed submission of accountability may also lead to falsification of
documents resulting into loss of funds. This was caused by failure by Accounting
Officers to enforce accountability controls and lack of advances ledger to monitor
advances. There is need for Accounting Officers to enforce controls relating to financial
management and accountability.
14
4.2.3 Overpayment of Salary
Section (B-a) (7) of the General rules on Payment of Salaries in Public Service Standing
Orders,2010 requires salaries to be paid correctly, promptly and as a lump sum in
accordance with the approved salary structure for the Public Service.
However, Payroll analysis carried out revealed that a sum of UGX 6,567,322,457 was
paid in excess of the approved salary scales to various staff.
The Accounting Officers attributed overpayments to challenges encountered during
deCentralization of salary payments on the Integrated Financial Management system
(IFMS) and Integrated Personnel and payroll system (IPPS) and outright errors during
the salary payment process. Many of the Accounting Officers explained that they had
initiated the process of recovering the overpaid amounts. I wait for evidence to that
effect.
4.2.4 Unsatisfactory Civil Works
Section 14 of the PPDA regulations require an Accounting Officer to have the overall
responsibility of the successful execution of the procurement, disposal and contract
management processes and ensure that implementation of the contract as per the
agreed terms. Audit inspection of the works in the roads, water, schools, health centres
and other buildings revealed that there were several projects with unsatisfactory
construction works amounting to UGX. 8,022,354,999. This implies that value for
money may not have been achieved. The Accounting Officers attributed this anomaly to
inadequate technical staff, delayed procurement process and inadequate capacity of the
Local contractors to execute the works.
I advised the Accounting Officers to enhance monitoring and supervision of contracts to
avoid such reoccurrences and to source for competent contractors.
4.3 INTERNAL CONTROL AND GOVERNANCE ISSUES
4.3.1 Under Staffing
The audit revealed high levels of vacant posts in Local Government has not significantly
improved. The levels ranged from 14 % in Bududa District Local Government to 87% in
Luuka Town Council.
15
Understaffing overstretches the available staff beyond their capacity, creates job-related
stress to the fewer staff and negatively affects the level of public service delivery to the
community.
This was attributed to limited wage bill and a ban on recruitment by the Ministry of
Public Service.
I advised the Accounting Officers to continue engaging the Ministries of Public Service,
Local Government and Finance Planning and Economic Development to address the
challenge. Meanwhile Government is advised to address this phenomenon to ensure
improvements in service delivery at Local level.
4.3.2 Outstanding Commitments
Regulation 11(d) of the Local Government Financial and Accounting Regulations, 2007
requires the Head of Finance to ensure that commitments are not approved unless there
is sufficient and committed funds available. However, a number of Higher Local
Governments for the year under review failed to adhere to the commitment control
system which resulted in committing Councils beyond the available financial resources.
Consequently twenty two entities accumulated outstanding commitments amounting to
UGX.3,115,454,282.
The outstanding commitments can lead to litigation or confiscation of Council assets if
not settled timely. The Accounting Officers attributed the anomaly to under collection of
Local revenue and shortfall in release of grants from Central Government.
I advised the Accounting Officers to adhere to provisions of the commitment control
system to eliminate arrears and ensure financial discipline.
4.3.3 Lack of Information Communication Technology Policy
Section 110 of the LGFAR (2007) requires the Chief Executive to designate an officer to
ensure that adequate Information and Communication Technology policies are
established and are applied to enable adequate security and protection over computers
and data held on computers or information systems operated by Council. It was
16
observed that Local Governments are making considerable investments in the
Information Technology equipment and related software without the necessary human
resource and proper procedures to manage the IT resources. There is a risk of loss of
equipment and data maintained therein.
Although the regulations require the Accounting Officers to designate an Officer to
manage the Information and Communication Technology resources, however the
Accounting Officers are experiencing difficulties in identifying the Officers with the
required competencies. It is recommended that the Ministry of Public Service should
review the organization structure of Local Governments to cater for ICT personnel.
4.4 ASSETS MANAGEMENT
4.4.1 Lack of Land Titles
Regulation 9 (j) of the Local Government Financial and Accounting Regulations, 2007
require the Accounting Officers to ensure safe custody of all assets of Council. It was
observed that out of 307 Local Governments, 118 entities representing 39% of the Local
Governments lacked land titles for the land where Council properties are located. There
is a risk that Council land is exposed to encroachment and disputes. The Accounting
Officers attributed this to lack of funds to process land titles and absence of District
Land Boards. There is urgent need for the Accounting Officers to prioritize and allocate
funds and ensure that the land titles are secured. The District Councils are also advised
to ensure that the District Land Boards are constituted.
4.4.2 Receivables
Paragraph 2.3.2.3 of the Local Governments Financial and Accounting Manual 2007
states that money owed to Council represents an asset that is idle, as it denies the
Council the opportunity of using the money to provide services promptly. Thirty two
(32) Local Governments failed to collect outstanding revenue from different sources
amounting to UGX.14,602,705,594. This was attributed to laxity on the part of the
Accounting Officers to follow up collection of the debts.
17
Uncollected revenue adversely affect service delivery and have an additional risk of loss
of revenue. I advised the Accounting Officers to develop debt recovery strategies to
ensure that all outstanding debts are collected.
4.4.3 Unspent balances
Section 17(2) of the Public Finance and Management Act, 2015 requires a vote that does
not expend money that was appropriated to the vote for the financial year at the end of
the financial year to repay the money to the consolidated fund.
It was however, observed that in thirteen (13) entities UGX 5,904,514,170 in respect of
conditional grants remained unexpended at year end and was not returned to the
consolidated fund contrary to the law.
The Accounting Officers attributed the shortcoming to the late release of funds and
promised to repay back the funds to the consolidated fund.
I advised the Accounting Officers to ensure that the funds are repaid to the consolidated
fund.
4.4.4 Utilized Capacity Building Infrastructure Development Funds Under
(USMID) Project
It was observed that 14 Municipal Councils under the USMID project had not fully
utilized funds released to them amounting to UGX.63,141,565,615 comprising of
capacity building funds (UGX.6,079,544,830) and infrastructure development funds
UGX.57,062,020,785.
Failure to utilize the released funds reflects lack of effective implementation of project
programs disadvantaging the community who are intended to benefit from the program.
Management attributed the low absorption of the Capacity Building funds to the failure
of the Municipal Councils to procure key retooling equipment for surveying, engineering
and environment among others partly due to lack of technical capacity to procure such
18
specialized equipment. In addition the delay to utilise the infrastructure development
funds was attributed to failure to attract responsive bidders for the jobs.
There is need to enhance the absorption capacity to ensure full utilization of the funds
released.
4.5 SECONDARY SCHOOLS AND TERTIARY INSTITUTIONS
4.5.1 Financial Statements for Secondary Schools, Primary Schools and
Health Centres
Regulations 61-64 of the Local Governments Financial and Accounting Regulations 2007
require District Hospitals, Health Units, Secondary Schools and Primary Schools to
prepare and submit financial statements to the Chief Executive on regular basis as
indicated below;
Table 7 Financial Statements for Secondary Schools, Primary Schools and Health Centres
Entity Period Chief Executive
District Hospitals Monthly and Annually Chief Administrative Officer
Health Units Monthly Sub-county Chief and copy
Administrative Units
Secondary Schools Each academic term and
Calendar year
Chief Administrative Officer
Primary Schools Each Academic term Sub-County Chief
The regulations further provide that where a Head Teacher and the In-charge of the
Primary Schools and Health centre respectively are unable to prepare the financial
statements, assistance may be sought from the sub accountant of the Sub-county.
Regulations 70 requires the Chief Executive to submit the accounts prepared in
accordance with these regulations to the Auditor General for audit.
In my audit reports for the two previous years, I observed that the entities lacked clear
guidance on the nature of books of accounts and specific financial statements to be
prepared. The primary schools and Heath Centres also lacked the necessary manpower
to prepare the books. These issues have not been addressed.
19
It is advised that the Ministry of Finance Planning and Economic Development together
with Ministry of Local Government issue relevant accounting manuals and guidelines for
preparation of financial records and statements in the schools and Health Centres.
4.5.2 Financial Statements for Lower Local Governments
In my audit reports for the two previous years, I noted that there was still a problem
with presentation of financial statements in the Lower Local Governments. In the
financial year under review, the shortcomings were still identified. The anomalies
include;
Non-adherence to presentation and disclosure requirements as per Local
Government Financial and accounting Manual 2007, for example, lack of cash flow
statements, schedule of commitments, and others.
Misstatement of account balances.
Non- preparation of primary books of accounts such as Ledgers, cash books, and
vote books.
Lack of Board of survey reports
Lack of Bank reconciliation statements and certificates of Bank balance.
Unbalanced Budgets
Lack of other statements, schedules and Notes to the accounts.
Missing budget figures in income and expenditure accounts.
Non-disclosure of losses.
Preparation of Financial statements is a stewardship role in which accountability for
application of resources entrusted to Accounting Officers is reported to the stakeholders.
Failure to present financial statements properly impairs interpretation and analysis of
entity performances. This is attributed to understaffing, lack of training, Low levels of
practical experience by clerks and non-adherence to the guidance provided in the Local
Governments’ Financial and Accounting Manual 2007 and other accounting standards.
Accounting Officers should liaise with responsible authorities to ensure the staffing gaps
are addressed and the necessary training undertaken.
20
4.5.3 Other Irregularities in Management of Schools and Tertiary Institutions
The analysis of 100 schools and tertiary Institutions out of the audited population of
277, revealed the following crosscutting issues;
1. Revenue shortfall
The analysis revealed revenue shortfall of UGX 3,045,515,542 in respect of 19
entities. The revenue shortfall implies that some planned activities were not
implemented. The shortfalls were attributed to Central Government budget cuts,
fees defaulters and shortfalls in student’s enrollments. There is need for the
Accounting Officers to continue liaising with the Ministry of Education and Sports and
other stakeholders to enhance revenue mobilization and collection.
2. Funds not accounted for
Audit revealed that funds amounting to UGX. 170,243,404 in 58 entities remained un
accounted for contrary to the Regulations. In the absence of accountabilities, it
becomes difficult to confirm that the funds were utilized for the intended purposes.
Delayed accountability of funds may lead to falsification of documents and loss of
funds. The delays to present accountabilities are attributed to laxity of the
Accounting Officers to enforce the internal controls regarding accountability. There is
need for the Accounting Officers to enforce controls relating to financial
management and accountability.
3. Noncompliance with PPDA Act and the Regulations
Out of the sample of 100 entities, audit observed noncompliance with the PPDA Act
and the Regulations in 52 schools and tertiary institutions. The most common
problems identified included the following;
Lack of consolidated procurement plans
Lack of prequalified list of suppliers
Failure to maintain procurement records
Application of inappropriate procurement methods with less competition with a
risk of higher costs.
21
Lack of procurement officers
Consequently, value for money may not have been achieved from the procurements
executed. These irregularities were attributed to lack of procurement Officers in the
school staff structure. The guidelines 4.1 and 4.2 of PPDA (Schools) define the
structure through which public procurement activiites are carried out in schools. It
requires that Schools with a budget not exceeding UGX.45 million shall employ one
procurement officer and schools with budget exceeding UGX.45 million shall employ
two procurement officers. However, the Accounting Officers explained that the
approved structure of the schools lacks the position of the procurement officer.
There is need for the Accounting Officers to engage the Ministry of Public Service,
Ministry of Local Governmnent and Ministry of Education and Sports in consultation
with the PPDA so that procurement officers are provided for in the school structure.
4. Noncompliance with the Income Tax Obligations
The analysis revealed that Taxes totaling to UGX 160,117,688 were not deducted in
the form of Pay As You Earn (PAYE) and Withholding Tax (WHT) in 15 schools. Non-
compliance with the tax law attracts fines and penalties from the tax body. This was
attributed to lack of awareness of the Income Tax law. There is a need by the
Accounting Officers to engage URA for sensitization on tax obligations to achieve tax
compliance.
5. Assets Management
Lack of Land Titles
It was observed that 33 schools representing 34% of the sampled schools and
Tertiary Institutions lacked land titles for the land where their properties are located.
This was attributed to the reluctance by the founding bodies to surrender ownership
of land and lack of funding to process land titles. This creates a risk of
encroachment and land disputes. There is need for the accounting officers to engage
the founder bodies and also prioritize funds allocation to secure the land titles.
22
Lack of Fixed Assets Register
The analysis revealed that 11 schools representing 11% of the sampled schools did
not maintain fixed assets registers. In the absence of fixed assets registers the
verification of the fixed assets is rendered difficult. This anormaly was attributed to
management laxity in ensuring that the details of the fixed assets owned by the
entity are properly recorded. The Accounting Officers are advised to ensure that the
Assets Registers are established.
Understaffing
The audit revealed high levels of vacant posts in 17 Schools. The levels ranged from
16% at Kasese Senior Secondary School to 88% in Uganda Technical College Kyema.
Understaffing hampers service delivery and may lead to poor academic performance.
The understaffing was attributed to the recruitment ban by the Ministry of Public and
the wage bill ceiling. Accounting Officers should engage the Ministry of Education,
Ministry of Public Service and the Education Service Commission to ensure that the
vacant posts are filled.
Governance
Audit observed that board meetings were not regularly convened to discuss strategic
matters affecting the institutions as required by the Regulations. In some instances,
the tenure of the boards had expired. The failure to convene the meetings regularly
was attributed to lack of funding. The Ministry of Education was also cited for
delaying to renew or appoint Board members. There is need for Accounting Officers
to prioritize and fund Board meetings and also follow up with the Ministry of
Education to ensure that Board members are appointed timely.
6. Lack of Standard Financial Reporting Framework
It was observed that there was no standard financial reporting framework for
secondary schools. This was attributed to lack of financial and accounting manual.
As a result, there was no uniform classification and coding of account balances,
format and presentation of financial statements. Section 29 (2) of Education (Board
of Governors) regulations require the board to prepare within three months financial
statements in the form approved by the Minister or district secretary for Education.
23
There is need for the Minister or District Secretary for Education to prescribe the
format of the financial statements for the Secondary Schools in consultation with the
Accountant General.
Inspection of the Schools and Tertiary Institutions Infrastructure
Audit inspection revealed inadequate classrooms, inadequate staff accommodation,
condemned structures with asbestos sheets, and lack of sick bays, inadequate
computer equipment, lack of laboratories and lack of lightening conductors. These
inadequacies impact adversely on the academic performance of the institutions. This
was attributed to lack of funds for infrastructure development. There is need for
Accounting Officers to liaise with the Ministry of Education and Ministry of Finance
for the requisite funding.
24
Table 8 Details of Significant Crossing Cutting Issues per OAG Branch Offices
Local
Revenue
Under-
collection
Irregular
levy of Dev't
tax
Procurement
anomaliesOverpay
ment of
salaries
unstafactory civil
worksUnderstaffing Lack of ICT policy Lack of Land Title Unspent balance
Un utilised
Capacity Building
and Infrastructure
Development Fund
under USMID
Others Type of Opinion
S.nos Entity
Breach of
Procurement
Procedures
Un-vouched
expenditure
Incompletel
y vouched
expenditure
Unaccounte
d for
Administrati
ve advances
Arua Branch
1 Adjumani DLG 10,609,950 0 0 0 Unqualified Para 5.1.1.1
2 Adjumani TC 86,523,128 0 0 0 0 Unqualified
3 Arua DLG 0 0 0 0 27,607,069 0 51% x Unqualified
4 Arua MC 0 0 0 0 0 489783196 46% 4,780,442,890 Unqualified 5.1.2.1
5 Koboko DLG 0 1,640,160,224 0 0 4,559,057 24,000,000 62% x Unqualified
6 Koboko TC 0 0 0 0 0 0 Unqualified
7 Maracha DLG 0 0 0 11,810,000 11,856,589 37,602,440 25% Unqualified 5.1.3.1
8 Maracha TC 0 0 0 0 0 0 52% Unqualified
9 Moyo DLG 0 11,722,603 0 45,815,000 25,044,000 0 29,381,000 Unqualified 5.1.4.1
10 Moyo TC 0 0 0 0 0 Unqualified 5.1.5.1
11 Nebbi DLG 76,931,170 0 0 11,873,000 0 49% Unqualified
12 Nebbi TC 61,012,973 0 0 0 0 Unqualified
13 Paidha TC 0 0 0 0 0 Unqualified
14 Pakwach TC 0 0 0 0 0 Unqualified
15 Yumbe DLG 103,310,117 0 0 0 985,496 430,233,040 x 2,021,502 Unqualified 5.1.6.1
16 Yumbe TC 86,523,128 0 0 0 0 Unqualified
17 Zombo DLG 0 0 0 12,894,750 0 467,436,259 x 89,456,000 Para 6.1.7.1 Unqualified 5.1.7
18 Zombo TC 0 0 0 5,916,000 0 58% x Unqualified
TOTALS 414,300,516 1,650,770,174 45,815,000 67,537,750 45,008,211 1,562,460,312 91,477,502 4,780,442,890
Other
SIGNIFICANT
ISSUES
Revenue Expenditure Internal control & Governance Asset management
Funds not accounted
25
EntityLocal Revenue
Under-collection
Irregular levy
of Dev't tax
Breach of
Procurement
Procedures
Inadequate
contracts
management
Unauthorised
contracts
variations
Incompletely
vouched
expenditure
Unaccounted
for
Administrative
advances
Missing Vouchers Payroll Unsatifactory
Civil works Payables
Understa
ffing %
Managem
ent of
ICT
Lack of
land
titles
Receivables Unspent
balances
LOW
ABSORPTION OF
USMID FONDSOther
issues Opinion
other
siginificant
issues
FORT PORTAL
Buliisa District 25,294,915 2,433,760,448 10,500,000 19,705,820 18,000,000 59% X 86,406,128 Unquallified
Buliisa Town Council X Qualified
Bundibugyo District 445,286,662 194,450,332 146,338,827 230,375,671 697,623,483 Unquallified 5.2.1.1
Bundibugyo Town Council 11,591,985 X Unquallified
Butunduzi Town Council 1,934,518 Unquallified
Bweyale Town Council X Unquallified 5.2.10
Fort Portal Municipal C 1,370,375,848 15,489,480 40% X 777,379,086 Unquallified
Fort Portal Regional RH Unquallified
Hima Town Council 4,081,600 Unquallified
Hoima District 13,132,000 18,820,850 6,500,000 137,417,000 50% Unquallified 5.2.3.1
Hoima Municipal Council 18,454,400 26,084,928 61% X X 6,341,624,951 Unquallified 5.2.4.1
Hoima Regional RH Unquallified
Kabarole District 608,104,970 X Unquallified
Kagadi Town Council 21,547,814 5,350,500 Unquallified 5.2.6.1
Kakumiro Town Council 77% Unquallified
Kamwenge District 2,730,000 823,821 27% X X Unquallified
Kamwenge Town Council 55,162,338 2,360,000 73% Unquallified
Kanara Town Council 57% Unquallified
Karago Town Council 64% X X Unquallified 5.2.2.1
Karugutu Town Council 87,672,401 65% Unquallified
Kasese District 38,448,323 5,000,000 365,437,300 26% 167,284,497 Unquallified
Kasese Municipal C 22,840,000 21,890,103 Unquallified 5.2.5.1
Katooke Town Council 1,047,500 13,563,401 46% X Unquallified 5.2.12
Katwe Kabatoro TC 69,315,876 200,351,881 Unquallified
Kibaale District 39% Unquallified
Kibaale Town Council 44,617,580 1,166,200 55% X Unquallified
Kibiito Town Council 3,212,000 66% Unquallified
Kibuku Town Council 3,410,000 Unquallified
Kigorobya Town Council 60% Unquallified
Kigumba Town Council 55% X Unquallified
Kijura Town Council 68% Unquallified
Kiko Town Council 12,923,264 55% Unquallified
Kiryandongo District 9,839,000 7,009,394 34,444,192 Unquallified 5.2.9
Kiryandongo Town Council 60% Unquallified
Kyarusozi Town Council 52% X Unquallified
Kyegegwa District 15,797,199 18,657,100 2,324,023 24% Unquallified 5.2.8.1
Kyegegwa Town Council 3,285,628 Unquallified
Kyenjojo District 12,735,000 14,583,900 17% Unquallified 5.2.11
Kyenjojo Town Council 39% Unquallified
Masindi District 71,256,267 41% X Unquallified
Masindi Municipal C 141,324,048 30,000,000 210,474,068 3,290,000 X Unquallified 5.2.7.1
Mpodwe Lhubiriha TC 26% Unquallified
Muhoro Town Council 11,657,387 59% Unquallified
Ntoroko District 34,000,000 49% X Unquallified 5.2.13
Nyahuka Town Council 72,473,072 X 288,894,036 Unquallified
Rubona Town Council Unquallified
Rwebisengo Town Council 1,250,000 Unquallified
Rwimi Town Council 75% X Unquallified
TOTAL - FORTPORTAL 2,203,694,151 79,540,437 3,119,768,626 210,474,068 215,998,146 51,794,400 276,318,825 239,199,694 792,202,445 600,009,488 115,352,053 15 - - 475,932,609 288,894,036 7,119,004,037 - -
REVENUE PROCUREMENT ANOMALIES FUNDS NOT ACCOUNTED FOR INTERNAL CONTROL AND GOVERNANCE ISSUES Assets management
26
Procurement anomalies Funds not accounted for
Understaffi
ng Assest Management Unspent balances
Under absorption of
funds under USMID Types of Opinion
OTHER
SIGNIFICANT
Entity
Under collection
local revenue
Irregular levy of
Development tax
Lack of
Procuremen
t files
Breach of
Procuremen
t
Procedures
Inadequate
contracts
manageme
nt
Unauthoris
ed
contracts
variations
Un-vouched
expenditure
Incompletel
y vouched
expenditure
Unaccounted for
Administrative
advances
Missing
Vouchers
Overpayment
of salaries Lack of land titlesReceivables
8
1 ADUKU TC 67 X Unqual i fied
2 AGAGO DLG 62,693,485 25,449,200 66 Unqual i fied 5.3.2
3 AGAGO TC X Unqual i fied
4 ALEBTONG DLG 57 X Unqual i fied 5.3.3
5 ALEBTONG TC 77 X Unqual i fied
6 AMOLATAR DLG 27,224,132 39,929,500 3,531,125 47 Unqual i fied
7 AMOLATAR TC 77 Unqual i fied
8 AMURU DLG 50,029,306 83,166,346 125,942,346 Qual i fied
9 AMURU TC Unqual i fied
10 AMURU TC Unqual i fied
11 ANAKA TC Unqual i fied
12 APAC DLG 85,520,700 54.450,679 1,765,395,052 Qual i fied 5.3.1
13 APAC TC 77 Unqual i fied
14 AYER TC X Unqual i fied
15 DOKOLO DLG 14,186,821 22,979,000 Unqual i fied
16 DOKOLO TC Unqual i fied
17 GULU DLG 330,564,366 210,883,447 Unqual i fied 5.3.4
18 GULU MC 18,867,000 44 6,365,144,394 14,505,711,262 Unqual i fied
19 GULU RRH Unqual i fied
20 KALONG TC 50 X Unqual i fied
21 KITGUM DLG Unqual i fied 5.3.6
22 KITGUM TC Unqual i fied
23 KOLE DLG X Unqual i fied 5.3.5
24 LAMWO DLG 72,381,163 37,218,100 Unqual i fied 5.3.7
25 LAMWO TC X Unqual i fied
26 LIRA DLG 32,955,855 Unqual i fied 5.3.8
27 LIRA MC 6,773,520,311 Unqual i fied
28 LIRA RRH Unqual i fied
29 NAMASALE TC Unqual i fied
30 NWOYA DLG 37,975,969 66 Unqual i fied
31 OTUKE DLG 25,381,700 20 X Unqual i fied
32 OTUKE TC 69 Unqual i fied
33 OYAM TC Unqual i fied
34 PADER DLG 35,236,426 67,849,000 32,334,357 Qual i fied 5.3.9
35 PADER TC Unqual i fied
36 PADIBE TC 17,220,254 X Unqual i fied
37 PATONGO TC Unqual i fied
TOTAL 347,784,620 261,751,333 444,336,515 405,647,130 6,365,144,394 1,765,395,052 21,279,231,573
Revenue
27
Lack of
Procuremen
t files
Breach of
Procuremen
t Procedures
Inadequate
contracts
managemen
t
Unauth
orised
contrac
ts
variatio
ns
Un-
vouche
d
expendi
ture
Incomplete
ly vouched
expenditur
e
Unaccounted
for
Administrativ
e advances
Missing
Vouche
rs
Lack
of land
titles
ReceivablesUnspent
balances
Low absorption
of funds under
USMID project
OPINION
BUGEMBE TC 137,886,844 4,017,250 57.50% X Unqualifed
BUGIRI DLG 490, 392,030 5.4.1.1 Unqualifed
BUGIRI TC 119,645,710 47% 13,301,500 Unqualifed
BUSEMBATIA TC 13,535,480 X Unqualifed
BUYENDE DLG 5.4.2 Unqualifed
BUWENGE TC X Unqualifed
BUYENDE TC 18,969,463 46% 5,658,463 X Unqualifed
JINJA DLG Unqualifed
JINJA MC 1,846,307,177 815,181,449 X 2,707,996,392 2,750,777,445 2,750,777,445 Unqualifed
IGANGA DLG Unqualifed
IGANGA MC 37,380,748 13,733,000 47% 452,957,716 X 5.4.3 Unqualifed
JINJA DLG 5.4.4 Unqualifed
KAKIRA TC 47% X 37,298,200 5.4.5 Unqualifed
KALIRO DLG X Unqualifed
KALRO TC 262,332,542 58,340,453 Unqualifed
KAMULI DLG Unqualifed
KAMULI TC 33%) 25,994,540 X 56,754,080 5.4.6 Unqualifed
KAYUNGA DLG 50,214,828 Unqualifed
KAYUNGA TC 14,417,402 X 5.4.7 Unqualifed
LUGAZI TC 417,568,212 X 374, 832,206 5.4.8 Unqualifed
LUUKA DLG 252,703,836 124,078,436 2,841,000 X Unqualifed
LUUKA TC 131,685,444 87% X 5.4.9 Unqualifed
MAYUGE DLG 8,971,108,256 7,684,723 X 5.4.10 Unqualifed
MAYUGE TC 61, 555,274 4,782,000 X 16,157,164 5.4.11 Unqualifed
NAMAYINGO DLG 4,537,004 Unqualifed
NAMAYINGO TC X 5.4.13 Unqualifed
NAMUTUMBA DLG 25,072,231 27% X Unqualifed
NAMUTUMBA TC 71.70% X 9,657,800 5.4.12 Unqualifed
NJERU TC 1,775,360,924 47% 243,307,220 1,140,969,693
Assest Management
Entity
Local Revenue
Under-
collection
Irregular
levy of
Dev't tax
Procurement anomalies
Unsatisfactory
Civil Works
Funds not accounted for
Salary
Overpaymen
ts.
Understaffing
Out standing
commitment
s
Lack of ICT
Policy
Revenue Expenditure Internal Control & Governance
other
SIGNIFICANT
ISSUES
28
Entity
Lack of
Procurement
files
Breach of
Procurement
Procedures
Inadequate
contracts
management
Unauth
orised
contrac
ts
variatio
ns
Un-vouched
expenditure
Incompletely
vouched
expenditure
Unaccounted for
Administrative
advances
Missing
Vouche
rs
Lack
of
land
titles
Manag
ement
of ICT
Low absorption of funds under USMID project
OPINION
BUIKWE TC 6,588,000 47 4,648,062 Unqual i fied
BUVUMA DLG 41 X 120,318,311 5.5.1.1 Unqual i fied
BUVUMA TC 53 Unqual i fied
ENTEBBE M C 185,328,120 1,072,191,081 39 2,689,465,010 213,688,889 5.5.10 Unqual i fied
KANONI TC 36,155,159 9,968,700 36 X 22,144,000 Unqual i fied
KIRA TCl 57 136,346,000 Unqual i fied
LUWERO TC 46 X 40,767,289 Unqual i fied
MASULITA TC X X Unqual i fied
MIGYEERA TC 12,758,783 55 X X 17,289,977 Unqual i fied
MPIGI TC 68 X Unqual i fied
NAKASEKE DLG X 16,482,829 5.5.8 Unqual i fied
NAKASEKE TC 48 Unqual i fied
NAKASONGOLA DLG 56,590,627 5,219,120 5.5.9 Unqual i fied
NAMAYUMBA TC 7,525,862 62 X Unqual i fied
NKOKONJERU T C 60 X Unqual i fied
SEMUTO TC 70 25,734,080 Unqual i fied
WAKISO TC 25,735,800 7,000,000 43 Unqual i fied
WOBULENZI TC 5.5.4 Unqual i fied
LUWERO DLG 442,358,600 X 201,403,969 5.5.3 Unqual i fied
MUKONO DLG 86,171,050 50,613,941 49,028,802 5.5.6 Unqual i fied
WAKISO DLG 801,756,780 45,200,000 X 2,276,126,315 Qual i fied
BUIKWE DLG X 22,101,891 231,357,766 Unqual i fied
BOMBO TC 49 X Unqual i fied
BUTAMBALA DLG 47 Unqual i fied
GOMBA DLG 46,692,000 70,357,900 39 X 5.5.2.1 Qual i fied
GOMBE TC 58 Unqual i fied
KAKIRI TC 4,081,350 2,743,000 65 Unqual i fied
KAKOOGE TC 45 X Unqual i fied
KIWOKO TC 59 X 12,947,750 Unqual i fied
MPIGI DLG 170,820,839 5.5.5 Unqual i fied
MUKONO M C 48,753,148 140,098,870 37 681,833,979 5.5.7 Unqual i fied
Nakaseke-Butalangu TC 53 X Unqual i fied
NAKASONGOLA DLG 44,272,579 34 Unqual i fied
NAKASONGOLA TC 42,305,176 Unqual i fied
NANSANA TC 49 Unqual i fied
NGOMA TC 52 6,931,250 Unqual i fied
56,590,627 884,603,939 316,699,170 48,753,148 214,188,599 578,292,561 1,109,032,426 2,314,711,035 49,028,802 2,689,465,010 706,361,041 498,275,411 723,900,885
Other
SIGNIFICANT
ISSUES
Procurement anomalies Funds not accounted for
Local Revenue
Under-
collection
Irregular
levy of
Dev't tax
Under
staffin
g
Assest Management
Over payment
of salaries
Unspent
balances
unsatisfactory
Civil WorksReceivables
outstanding
commitments
29
Entity
Over payment of
salariesunderstaffing
Outstanding
commitmentsLack of ICT policy
Lack of
land
titles
ReceivablesUnspent
balances
Management of
ICT Un-utilized capacity
building funds
Un-Itilised
Municipal
Infrastruture
Development funds
Opinion
Local Revenue
Under-collection
Irregular
levy of
Dev't tax
lack of
Procuremen
t files
Breach of
Procurement
Procedures
Inadequate
contracts
management
Unauthoris
ed
contracts
variations
Un-vouched
expenditure
Incompletel
y vouched
expenditure
Unaccounted for
Administrative
advances
Missing
Vouchers
unsatisfact
ory Civil
Works
Bukomans imbi DLG 49,987,100 2,405,000 4,781,554 47% 18,552,807 Unqual iofied
Bukomans imbi TC 8,497,500 36% 6,811,750 Qual i fied 5.6.12
BukomeroTC 13,939,999 Unqual i fied
Butemba TC 5,870,000 Unqual i fied
Kalangala DLG 154,797,939 Unqual i fied 5.6.1.1
Kalangala TC 30,621,965 Unqual i fied
Kal is izo TC 10,892,747 Unqual i fied
Ka lungu DLG 112,845,086 66% Unqual i fied 5.6.13.1
Kalungu TC 58% Unqual i fied
Kiboga DLG 96,586,599 Unqual i fied 5.6.2.1
Kiboga TC 29,072,850 36,231,042 Unqual i fied 5.6.3.1
Kyankwanzi DLG Unqual i fied
Kyazanga TC 20,153,150 1,917,919 Unqual i fied
Kyotera TC 3,299,500 34,141,950 Unqual i fied
Lukaya TC Unqual i fied
Lwengo DLG 196,049,907 40% Qual i fied 5.6.14
Lwengo TC Unqual i fied 5.6.15
Lyantonde DLG 13,900,000 20,299,700 19% Unqual i fied
Lyantonde TC Unqual i fied 5.6.4.1
Masaka DLG 19,969,080 6,701,833 Unqual i fied 5.6.5.1
Masaka MC 12,268,730 0 31% 438,553,614 4,641,850,452 Qual i fied
Mateete TC 14,007,000 27,275,000 1,135,000 66% Qual i fied 5.6.16
Mityana DLG 10,420,000 7,971,500 94,949,931 Unqual i fied 5.6.6.1
Mityana TC 47,045,886 54%Qual i fied –
Except for 5.6.7.1
Mubende DLG 72,427,966 3,160,000 69,219,325 55% Unqual i fied 5.6.8
Mubende TC 57,497,515 XX Unqual i fied
Ntwetwe TC Unqual i fied
Rakai DLG 27,389,000 39,487,993 Unqual i fied 5.6.9
Rakai TC 17,393,273 12,047,400 4,295,000 93,770,156 Qual i fied 5.6.10.1
Sembabule DLG 149,891,005 XX Unqual i fied
Sembabule TC 13,727,384 33,709,250 Qual i fied 5.6.11.1
TOTALS 785,717,478 103,661,000 384,864,472 97,743,325 50,971,380 214,084,644 70,372,992 438,553,614 4,641,850,452
Assets management
Other
SIGNIFICANT
ISSUES
Funds not accounted for
Internal Control and Governance issues
Procurement anomalies
Revenue Expenditure
30
S/N
Entity Overpayment of salariesUnsatisfactory Civil
Works
Other Significant Issues
S/N
EntityLocal Revenue
Under-collection
Irregular levy of
Dev't tax
Lack of
Procure
ment
files
Breach of Procurement
Procedures
Inadequate
contracts
management
Unauth
orised
contrac
ts
variatio
ns
Un-
vouche
d
expendi
ture
Incompletely
vouched
expenditure
Unaccounted for
Administrative
advances
Missing VouchersUnderstaffin
g
Outstanding
Commitments
Lack of ICT
policy
Lack of land
titlesReceivables Unspent balances
Low absorption of funds
under USMID project
OPINION
1 Binyiny T.C. Unqual i fied
2 Budadiri TC x 5.7.13 Unqual i fied
3 Budaka DLG 18,124,000 3,082,000 47% x 5.7.1 Unqual i fied
4 Budaka TC 30,777,250 5.7.2 Qual i fied
5 Bududa DLG 69,632,147 42,481,410 5,746,800 14% X 5.7.3 Qual i fied
6 Bududa TC 14,400,000 5.7.4 Unqual i fied
7 Bukwo DLG 669,167,530 5.7.5 Unqual i fied
8 Bukwo T.C. 4,858,076 2,204,000 x Unqual i fied
9 Bulambul i DLG 41,327,000 5,937,000 32,654,439 29% x 5.7.17 Unqual i fied
10 Bulambul i TC 4,346,722 2,065,000 x x 5.7.18 Unqual i fied
11 Bulegeni TC 5,051,257 5.7.19 Unqual i fied
12 Bus ia DLG 247,172,865 1,600,000,000 6,387,080 4,965,500 5.7.6 Unqual i fied
13 Bus ia MC 57,064,907 46,217,928 6,142,000 1,807,699,504 5.7.7 Qual i fied
14 Busolwe TC x Unqual i fied
15 Butaleja DLG 20,431,500 x x 5.7.8 Unqual i fied
16 Butaleja TC 1,492,000 1,767,500 62% x Unqual i fied
17 Kapchorwa DLG 17,464,343 12,405,500 7,077,176 130,201,210 237,345,720 Unqual i fied
18 Kapchorwa TC 5,074,091 8,036,350 Unqual i fied
19 Kibuku DLG 44,949,000 22,250,000 x Unqual i fied
20 Kibuku TC 71% Unqual i fied
21 Kween DLG 172,896,375 27,753,179 5.7.9 Qual i fied
22 Lwakhakha TC 4,488,000 5.7.16 Unqual i fied
23 Malaba TC 134,378,050 Unqual i fied
24 Manafwa DLG 53,369,800 13,321,500 352,203,981 179,262,236 37% x 5.7.10 Unqual i fied
25 Manafwa TC 9,914,000 5,440,200 56% Qual i fied
26 Mbale DLG. 13,831,850 10,577,850 5.7.11 Unqual i fied
27 Mbale MC 77,262,150 33,288,580 10,670,139 102,387,356 x 149,210,972 2,973,815,434 Unqual i fied
28 Mbale RRH 111,387,226 192,407,745 Unqual i fied
29 Nagongera T.C. 1,100,000 Unqual i fied
30 Nakaloke T.C. 1,616,000 19,110,210 Unqual i fied
31 Pal l i sa DLG 36,657,650 8,154,000 Unqual i fied
32 Pal l i sa T.C 65,728,476 2,548,000 42,970,136 33,379,111 Qual i fied
33 Sironko DLG 446,743,490 19,811,244 35,420,000 33,072,000 39,754,700 5.7.12 Qual i fied r
34 Sironko TC Unqual i fied
35 Tororo DLG 1,457,758,987 11,256,200 37,175,601 584,760,883 19% 400,417,880 5.7.14 Unqual i fied
36 Tororo MC 4,743,311 6,033,646 49.50% 1,397,702,463 1,554,561,921 5.7.15 Unqual i fied
818,849,886 19,811,244 3,818,588,667 2,204,000 635,896,493 374,853,452 29,636,115 1,099,759,838 1,986,961,740 (14-71)% 240,072,606 5 enti ties 9 enti ties 1,970,365,504 578,964,437 4,528,377,355
Revenue Procurement anomalies Funds not accounted for Internal Control and Governance issues Assets management
31
Entity
Salary Arrears understaffingOutstanding
commitments
Lack of land
titlesReceivables
Unspent
balances
Managemen
t of ICTUn-utilized
capacity
building funds
Un-Itilised
Municipal
Infrastruture
Development
funds
High
significan
ce issues
Opinion
Local Revenue Under-
collection
Irregular levy of Dev't
tax
lack of
Procuremen
t files
Breach of
Procuremen
t
Procedures
Inadequate
contracts
management
Unauthoris
ed
contracts
variations
Un-vouched
expenditure
Incom
pletely
vouche
d
expen
diture
Unaccounted for
Administrative
advances
Missing
Vouchers
shoddy
work/incomplete
projects
1.1 1.2 1.3 1.4 2.1 2.2 2.3 2.4 3 4 5 6.1 6.2 7 8 9 10 11
Bugongi TC 46% √ 5.8.18 Unqualified
Buhweju DA 78,041,512 136,268,682 47% √ 5.8.19 Unqualified
Bushenyi DA 107,570,405 28% None 5.8.1.1 Unqualified
Bushenyi Ishaka MC 190,274,411 51% √ None Unqualified
Butogota TC 0% 31,705,496 5.8.16 Qualified
Hamurwa TC 54% √ 50,252,000 5.8.4 Unqualified
Ibanda DA 152,336,448 7,223,750 49% √ Unqualified
Ibanda TC 50% Unqualified
Igorora TC 47% √ 5.8.15 Unqualified
Ishongororo TC 23,236,696 57,937,303 42,511,759 Unqualified
Isingiro DA 521,722,209 3,492,500 73,391,916 48% √ None Unqualified
Isingiro TC 52% √ None Unqualified
Kabale DA 602,133,718 626,759,249 30% √ None 5.8.2 Unqualified
Kabale MC 241,647,766 51% √ 390,251,751 3,239,814,298 Unqualified
Kaberebere TC 2,150,000 50% Unqualified
Kabuyanda TC 33,605,214 Unqualified
Kabwohe-Itendero TC 243,233,215 16,263,050 5.8.5 Unqualified
Kambuga TC 10,177,500 √ Qualifiedr
Kanungu DA 22,289,076 9,919,000 188,494,995 294,495,032 43% √ None Unqualified
Kanungu TC 29,202,300 Unqualified
Kashenshero TC 28% Unqualified
Katerera TC 55% √ Unqualified
Katuna TC 62% 5.8.3 Unqualified
Kazo TC 62% √ Unqualified
Kihihi TC 45,901,534 57,485,850 √ 10,410,000 5.8.6 Qualified
Kiruhura DA 198,483,510 58% √ 5.8.7 Unqualified
Kiruhura TC 12,858,687 30,400,000 71% √ Unqualified
Kisoro DA 222,129,342 44% None 5.8.8 Unqualified
Kisoro TC 53% √ 36,900,356 Unqualified
Kitwe TC 3,418,000 √ 5.8.9
Mbarara DA 56,272,300 181,341,578 47% √ 5.8.10 Unqualified
Mbarara MC 1,094,173,302 38,684,282 41% √ 437,698,988 508,232,407 7,543,649,367 Unqualified
Mitooma DA 135,790,022 23,676,147 0% √
Mitooma TC 52% Unqualified
Muhanga TC 25% √
Nsiika TC 5,502,400 0% √ Unqualified
Ntungamo DA 27% √ 5.8.11 Unqualified
Ntungamo MC 96,126,194 57% √ None Unqualified
Rubaare TC 43,635,986 52% 47,184,480 √ None 5.8.20 Unqualified
Rubirizi DA 1,800,000 51,424,559 55% √ 5.8.21 Unqualified
Rubirizi TC 54% Unqualified
Rukungiri DA 15% √ 5.8.13 Unqualified
Rukungiri MC 44% √ 5.8.14 Unqualified
Rushango TC 49% √ Unqualified
Rwashamaire TC 42% 5.8.12 Unqualified
Sanga TC 95,272,629 37% √ None Unqualified
Sheema DA 64,983,246 44% √ Unqualified
Sheema TC 46% √ 5.8.17 Unqualified
TOTAL - MBARARA BRANCH 3,600,986,191 9,919,000 75,105,850 765,195,275 1,605,818,846 1766% 136,827,279 - 594,036,153 - 898,484,158 10,783,463,665
Assets management
Procurement anomalies Funds not accounted for
Revenue Expenditure Internal Control and Governance issues
32
Lack of
Procuremen
t files
Breach of
Procuremen
t Procedures
Inadequ
ate
contrac
ts
manag
ement
Unauth
orised
contrac
ts
variatio
ns
Un-
vouche
d
expendi
ture
Incompletely
vouched
expenditure
Unaccounted
for
Administrativ
e advances
Missing
Vouche
rs
Lack
of land
titles
ReceivablesUnspent
balances
Under
absorption of
funds under
USMID project
Opinion
Abim DLG 28,916,066 238,898,882 210.817,332 134,357,138 29% x 5.9.1 Unqual i fied
Abim TC 1,327,370 119,518,420 3,269,000 x 5.9.2 Qual i fied
Amudat DLG 57,052,500 22,444,653 75% Unqual i fied
Amudat TC 33,279,637 Unqual i fied
Amuria DLG 15,130,000 151,106,022 7,885,000 66% x Unqual i fied
Amuria TC 80.3% Unqual i fied
Bukedea DLG 39,407,940 5,238,000 58% Unqual i fied
Bukedea TC 230,314,769 6,930,000 72% 5.9.3 Qual i fied
Kaabong DLG 38,331,400 2,862,000 63,347,362 43.3% Unqual i fied
Kaabong TC 72% Unqual i fied
Kaberamaido
DLG 21,361,901 295,508,467 17,141,102 63% Unqual i fied
Kaberamaido
TC 29,715,881 60% Unqual i fied
Kas i lo TC 4,769,117 65% x 2,465,000 Unqual i fied
Katakwi DLG 99,431,552 809,701,780 8,759,567 53% Unqual i fied
Katakwi TC 1,715,000 50% 114,164,545 Unqual i fied
Kotido DLG 350,562,261 19,591,000 24% x 108,703,734 5.9.4 Unqual i fied
Kotido TC 39,872,500 64% 121,748,782 Qual i fied
Kumi DLG 108,192,245 179,549,400 8,861,000 5.9.5 Unqual i fied
Kumi TC 60,974,255 8,934,240 13,405,777 x Unqual i fied
Lorengecora
TC70% x 379,976,896 Unqual i fied
Moroto DLG 51% 45,400,000 Unqual i fied
Moroto MC 2,506,607 370,527,515 1,016,592,010 5.9.6 Unqual i fied
Nakapiripi ri t
DLG176,646,750 32,687,192 20,691,180 x Unqual i fied
Nakapiripi ri t
TCx 5.9.7 Qual i fied
Napak DLG 164,179,000 6,603,287 30,269,697 42,615,934 Unqual i fied
Ngora DLG 9,024,000 49% 5.9.10 Unqual i fied
Ngora TC 41,794,158 1,624,000 22% 5.9.11 Unqual i fied
Serere DLG 59% 5.9.12 Unqual i fied
Serere TC 2,125,000 Unqual i fied
Soroti DLG 9,442,000 42% 5.9.8 Unqual i fied
Soroti MC 4,358,000 50% x x 2,228,864,335 5.9.9 Unqual i fied
794,012,515 36,846,723 254,028,882 2,303,623,818 39,872,500 216,720,773 174,999,798 1 10 650,970,031 379,976,896 3,245,456,345
Entity
Local
Revenue
Under-
collection
Irregular
levy of
Dev't tax
Procurement anomalies
unsatisfactory
Civil Works
Other
SIGNIFICANT
ISSUES
Revenue Expenditure Internal Control & Governance Assest Management
Funds not accounted for
Salary
Overpaymen
ts.
Unders
taffing
Out standing
commitment
s
Lack of ICT
Policy
33
PART II
5.0 DETAILED REPORT OF LOCAL AUTHORITIES
5.1 ARUA BRANCH
5.1.1. ADJUMANI DLG
Delayed completion of Civil Works
It was observed that two contracts amounting to UGX 154,257,282 were awarded for
Construction of school infrastructure (UGX 103,911,032) and a market (UGX
50,346,250). By the time of audit in August 2015, a sum of UGX.84,024,377 had been
paid however, the civil works had not been complete and the contract period had
expired as shown below:-
Description Period Amount Paid (UGX)
Audit Observation
M/s. Link Investment
Ltd
Contract sum UGX.
103,911,032
Construction of 2 units of semi
detached staff
house, kitchen and 2 stance
drainable latrines at
Aliwara Primary
School.
The start and end dates
were
22/9/2014 and
22/3/2015 respectively
58,728,727 The contract period has not been renewed. The facial
boards, glasses and
internal doors had not been fixed;
Solar water tank and electrical wiring not
installed and
Kitchen chimney shutters and floor have not been
completed.
M/s. Maria Vusi Silvia
Vuga Ltd Contract sum
UGX.
50,346,250
Construction of Maasa Market.
The start and end dates
were 1/10/2013
and
31/3/2014
25,295,650 12 doors of casements at UGX.3,485,400 not fixed
Water disposal system comprising of PVC, rain
water pipe and gutters
worth UGX.1,867,500 had not been done.
A delay to complete the civil works denies the communities prompt services.
34
The Accounting Officer explained that the contractor for the construction of school had
abandoned work.
I advised the Accounting Officer to ensure that the works are completed.
5.1.2. ARUA MC
Delayed Completion of Afra Road
The maintenance of Afra road (0.5 km) under Ref: 751/wks./14-15 was done using
Force on Account mechanism at a cost of UGX 616,977,880 using Uganda Road Fund.
The scope of work involved grading, formation and shaping of road, application of 2
seals, construction of head walls & wing walls on culvert lines, installation of culvert lines
on road and access road, supply of some construction lines and relocation of utilities and
installation of street lights.
It was observed that at time of inspection, that the Council had spent UGX 489,783,196.
However, according to the bills of quantities the following works were still outstanding;
Drainage works
Tarmacking
Gravelling
Grading and shaping
Relocation of utilities
Street lights
Utilities not relocated No gravel, grading & shaping (no earth work)
35
No drainage works done Buildings in the road not yet demolished
The Accounting Officer explained that the project had delayed due to some individuals
who had failed to remove the perimeter walls that were constructed in the road reserve.
However, the District through the physical planning committee had given an ultimatum
to the residents affected to remove the wall fences, but the materials in contention are
safely secured and guarded in the Council yard.
The matter should be given urgent attention.
5.1.3. MARACHA DLG
Abandoned Contracts
Construction of two class room block at Alikua Islamic Primary school.
A Local contractor was engaged in 2013/14 to construct a 2 classroom block at Alikua
Islamic Primary School at a contract sum of UGX.45,087,100 using PRDP funds.
At the time of audit UGX.32,976,400 representing 73% of the contract price had been
paid to the contractor. However, physical inspection of the site in July 2015 revealed
that the contractor had roofed the building, fixed the windows and doors burglar frames
but abandoned the site before plastering as shown in the photograph below;
36
Pictures above showing abandoned classroom block at Alikua PS
The Accounting Officer explained that the contractor abandoned the site before
completing the works. However, the project had been rolled over, planned and
budgeted for in the financial year 2015/2016.
I advised the Accounting Officer to pursue the contractor and ensure construction is
completed.
Construction of Pit latrines at Wadra and Curube HC IIs
The district contracted a Local firm in the financial year 2012/13 to construct 2 pit
latrines at Wadra HC II and Curube HC II at a contract sum of UGX 13,998,480 under
PRDP/PHC funds.
It was observed that UGX 4,626,040 was paid to the contractor. However, physical
inspection of the sites revealed that the contractor abandoned the works at walling as
shown in the photos below;
Abandoned pit construction at Wadra HC II and Curebe HC II respectively
In the circumstance, value for money may not be realised.
37
The Accounting Officer explained that the contractor abandoned the site before
completing the works. However, the project had been rolled over, planned and
budgeted for in the financial year 2015/2016.
I advised the Accounting Officer to engage the contractor and ensure construction is
completed.
5.1.4. MOYO DLG
Construction of Out of Patient Department at Malanga HC 11
Construction of Out of Patient Department was awarded to MS Quks Enterprise at UGX
99,750,000 under PRDP. The contract commenced on 28th January 2015 and was
supposed to be completed on 15th May 2015. At the time of inspection, the contractor
had been paid UGX 88,153,414 representing 88%. However, the following works had
not been done:-
Electric installation worth UGX. 3,095,000
Screeding of the floor & verandah
Roofing of the building was not complete
Fixing of the Face board
Concrete bench seat
Medical sink worth UGX. 4,630,000
Both internal & external water drainage worth UGX. 16,839,000
Installation of the solar worth UGX 4,817,000.
The Accounting Officer explained that all issues raised had been rectified and the
construction had been completed. However, on further verification the issues were still
outstanding.
I advised the Accounting Officer to ensure that the works are completed before final
payments are made.
5.1.5. MOYO TC
38
Construction of watchman’s room and store at Perego village for proposed
Garbage Site
During the year M/s Oasis enterprise Ltd was contracted to construct a watchmans room
and a store at Perego village at a contract sum of UGX 20,743,100. By the time of
audit, the civil works had been completed and the contractor had been paid UGX
19,108,544 leaving a balance of UGX 1,634,556.
Audit inspection carried out on 23rd Oct, 2015 revealed that the iron sheets on the
watchman’s house and the store had been removed as shown below:-
Iron sheets have been removed.
The Accounting Officer explained that the Council secured land in Parego village, for
development of a modern garbage management. However the community under the
influence of some prominent people rejected the project. The matter was brought to the
attention of top district officials, but no action was taken. Consequently the watch man’s
house and store were vandalized by the residents.
I advised the Accounting Officer to follow up the matters with district officials and
sensitize the community to ensure acceptance of the project by the community.
39
5.1.6. YUMBE DLG
Delayed completion of contracts
Regulation 18(3) LGFAR provides that budget estimates shall be based on the objectives
to be achieved for the financial year and efforts shall be made to achieve the agreed
objectives or targets, as programmed by the district. Furthermore, Regulation 26 (2) &
26(6) of the PPDA Regulation states that a user department will be responsible for
contract management, once a contract is signed and shall report any departure from the
terms and conditions of the contract to the Accounting Officer with a copy to the
procurement and disposal unit.
It was observed that three (3) contracts totaling UGX.430,233,040 undertaken during
the financial year had not been completed at the time of writing this report and there
was no evidence to show that the Accounting Officer had taken any action to compel the
contractors finish the works. Besides, the contracts had expired. The details are shown
below:-
Delayed completion of contracts
Proc Ref No Contract Details Contractor Contract
Sum UGX
YUMB556/WRKS/14-
15/00026
Renovation of
Maternity Ward at
Yoyo HC
Amamba
Construction &
Engineering Works
51,000,840
YUMB556/14-15/00021 Construction of OPD
at Barakala HC Babu and Brothers 114,817,280
YUMB556/14-15/00029
Construction/Raising
the Level of Kochi
Drift Bridge
264,414,920
Total
430,233,040
Delayed works deny the community timely services.
The Accounting Officer explained that there were delays in processing payment
certificates and the contractors had asked for time extension.
The Accounting Officer was advised to ensure that the projects are completed.
40
5.1.7. ZOMBO DLG
Grants Released but not Credited to the District General Fund Account
Section 4.9 of the Local Government Financial and Accounting Manual (LGFAM) of 2007
requires Government to remit Conditional, Unconditional and Equalization Grants to the
district and acknowledgement receipts sent to the Central Government (MoFPED),
confirming the receipt of funds. However, a reconciliation of Cash Release/Treasury
Credit Advices slip from Ministry of Finance, Planning and Economic Development
against the District General Fund Account revealed that UGX. 200,363,048 purportedly
released to the district were not credited on the district General Fund Account as shown
below;
Warrant Number Description Amount
RW025/14/15 Development Grant for Oct 2014 148,396,048
RW024/14/15 Recurrent Grant for Oct 2014 51,967,000
Total 200,363,048
The Accounting Officer explained that the matter was noted during reconciliation of the
releases from the Treasury and clarification was sought from the Permanent
Secretary/Secretary to the Treasury on the two credit advices by the district. However,
no response was provided and the money had not been received on the district account
by end of year.
In the circumstance, there is a risk that the funds could have been diverted.
I advised the Accounting Officer to follow up the matter with the Ministry of Finance,
Planning and Economic Development.
Abandoned NUSAF Projects
In a letter dated 4th June 2014 the Office of the Prime Minister Wrote granting the
district autonomy over the implementation of NUSAF projects which the district took
over henceforth in its jurisdiction.
Audit inspection carried out on the 4th of August 2015 revealed that seven of the
projects taken over as contained in the table below had not been completed.
An interview with the NUSAF focal person revealed that the contractors were paid
advances to start off works which is irregular under the NUSAF program. It was further
41
observed that performance security guarantees had not been sought from the
contractors.
Sub Project Signing
Date Contractor
Contract
Sum Amount Paid
Papoga P/S 3
classroom
block
2/11/2011 YemimuUnegiu
Enterprises 57,800,000 47,319,577
Pakadha
HCII staff
house
27/11/2012 Daat Company 79,094,972 48,028,104
Warr HC III 10/10/2012 Trinity Engineering
and construction 78,910,125 68,023,004
Atyak P/S
classroom
block
20/11/2012 Ckovem Construction
engineering 95,590,320 73,008,754
Kaya P/S
Classroom
block
9/8/2012 Ulto Engineering Ltd 96,753,051 83,249,187
Atyak HCIII 8/11/2012 Jagon company (U) 78,119,265 70,495,965
PakekAjja PS 27/12/2011 Jagon company (U) 79,312,500 77,311,668
Total 565,580,233 467,436,259
Pakadha HCIII staff house Patek Ajja P/S classroom blocks
Papoga P/S classroom block Warr HCIII staff house
42
The Accounting Officer explained that the contractors moved to other sites prior to
completing their contracts and later had cash flow shortages but added that memoranda
of Understandings (MOU’s) were signed between the IGG, the District and the contractor
guarantying completion of the works. However the process has been slow and it was
observed that inferior materials (window frames) had been used on majority of the sites.
I advised the Accounting Officer to closely monitor the works progress and ensure works
are done in line with standards specified in the contract agreements.
Unspent Balances not returned to the Consolidated Fund
Section 17(2) of the Public Finance management Act 2015 requires that a vote that does
not expend money that was appointed to the vote for the financial year to repay the
money to the Consolidated fund.
Contrary to the above, a total of UGX 89,456,000 remained unutilized at year end and
had not been returned to the Consolidated Fund at the time of writing this report
contrary to the regulations.
The Accounting Officer explained that the funds had been returned to the Treasury.
However, the acknowledgment receipt from Treasury was not presented for audit
verification.
I advised the Accounting Officer to ensure that the unutilized funds are returned to the
Consolidated Fund and the acknowledgement receipt from Treasury should be obtained
and presented for audit verification.
Delayed completion of Road Works
The district signed a contract agreement with M/s. Six Way General Engineering on the
21st of May 2013 for opening and rehabilitation of Palwo P/S - Agingo Chapel road at a
contract sum of UGX. 185,410,540. The works were to be completed within (2 months)
effective 21st May 2013 to 22nd August 2013.
43
It was observed that the project was delayed by 17 months and final certificate was
issued for payment on the 13th of February 2015. However it was observed that the
district did not invoke the provisions of special condition no. GCC.49.1 of the contract
that call for either termination of the contract or the aggrieved party (District) to be paid
liquidated damages at a rate of 0.025% of final contract price per day or maximum of
10% of the entire works amounting to UGX. 18,541,054. Besides, there was no evidence
that the contract period was extended by the contracts committee as required by PPDA
regulations. It was further observed that the district retained UGX. 3,331,208 instead of
UGX 9,270,527 representing 5% of the entire contract sum.
Delayed completion of the works denied the communities the prompt use of facility.
The Accounting Officer explained that the anomalies were due to lack of a Senior
Engineer who had now been recruited for proper supervision.
I advised the Accounting Officer to ensure that the works are properly managed and
supervised.
Service Delivery
Rehabilitation of Gira-Alicudu and Pakadha-Awasi Roads
The contract for the rehabilitation of Gira-Alicudu, Pakadha-Awasi road was awarded to
Link Investments limited at a contract sum of UGX 151,782,750. The contract was
effective from 25th February 2015 to 25th May 2015.
A review of the records revealed that UGX 103,882,250 had been paid to the contractor.
However, inspection carried out on the 5th August 2015 revealed the following.
The BOQs specified 900 mm culvert however, the contractor used 600 mm culverts
leading to a financial loss of UGX 1,080,000.
It was also observed that head walls for some culvert were not properly
constructed. Consequently, some of them had been submerged below the road
surface making it difficult to divert the rapid flowing waters as shown below
44
Accordingly the related cost of UGX 12,000,000 was rendered wasteful. The works
were still on going as piles of murram was seen on the road as shown below
The culvert bridge on Gira-Alicudu road was to be 12m with 1200mm in diameter
implying that two lines measuring 6m each were to be installed as per the BOQs.
However inspection revealed that only one line of 900mm diameter had been
installed as shown below
As a result the district incurred a fiancail loss of UGX.360,000
The culvert bridge on Pakadha–Awasi road was supposed to be 18m with 1200 mm in
diameter. Implying that three lines measuring 6 m each were to be installed. However
by the time of inspection, only two lines of 900 mm diameter had been installed contrary
to the BOQs as shown below
45
It was further observed that the Council trucks were being used to transport murram to
the site although the contract had been awarded to a private contractor.
The Accounting Officer promised to ensure effective supervision and monitoring of the
contract.
I advised the Accounting Officer to closely monitor the work in progress and ensure
completion of the contract.
Non-operational Health Centre
The construction of semi-detached staff house, kitchen and two stance VIP pit Latrine at
Mudhel HC III was awarded to M/s.E & B Construction Limited on 6th February, 2012 as
per contract agreement dated 13th February, 2012 at a contract sum of UGX94,532,955.
Review of the related records and an audit inspection carried out on 04th August, 2015
revealed that although the contractor was fully paid upon completion of the work, the
following shortcomings were identified;
The OPD, semi-detached staff house, kitchen and two stances VIP Latrine had been
abandoned as evidenced by the wild grass growing around the constructed
structures in the photo below.
46
The door glasses are already broken as evidence in the photo below.
The Acting District Health Officer admitted that the health Centre remained non-
operational due to lack of furniture.
Non operationalization of such a Health facilities deprives the community access to
medical services. Consequently, the community has to travel over 10 kilometer to
Nyapea Health Centre to access medical services.
The Accounting Officer explained that management had taken steps to operationalize
the facility though at a minimal scale but will have it fully operationalized during the
financial year 2016/17 .
I advised the Accounting Officer to ensure the Health facility is furnished and become
operational.
47
Un-validated Staff Payroll
Section (A-n) (19) the Uganda Public Service Standing Orders provides that in the
absence of communication from an Officer and failure to resume duty within 30 days,
the Officer shall be deemed to have abandoned duty.
During the period under review, I conducted a validation exercise where I appointed
Ernst and Young Certified Public Accountants on my behalf. Ernst and Young Certified
Public Accountants in a letter dated 7 November 2014 wrote to the district asking for
explanations in regard to the additional personnel found on the district payroll during
the payroll biometric validation. It also highlighted that 118 staff had missed the
validation exercise and cautioned that those who failed to present themselves would be
at risk of deletion from the payroll.
However it was noted at the time of writing this report that, the district had not yet
implemented the recommendations of Ernst and Young since the affected staff were still
on the payroll.
There is therefore a risk of salary payments to ghost employees and an over
exaggerated wage bill.
The Accounting Officer admitted the anomaly and promised to implement the
recommendations of Ernst & Young.
I advised the Accounting Officer to implement the recommendations of Ernst & Young
and ensure regular reconciliation between the payroll and the staff list.
5.2 FORT-PORTAL BRANCH
5.2.1. BUNDIBUGYO DLG
Salary Arrears
Paragraph 5.6.2 of the Local Governments Financial and Accounting Manual, 2007 states
that all payments of salaries and wages shall be made monthly
However, it was established that at the time of audit, the entity had salary arrears
amounting to UGX 625,068,071. Out of this, only UGX 139,478,216 had been approved
48
by the Ministry of Finance, Planning and Economic Development for payment leaving a
balance of UGX.485,589,855 still undergoing verification.
Failure to pay the salary in time demotivates staff.
The Accounting Officer explained that Council had so far written two letters requesting
the Ministry of Finance, Planning and Economic Development to clear the arrears.
I advised the Accounting Officer to follow up the matter with the Ministry to ensure that
the salary arrears are paid.
5.2.2. KARAGO TC
1. Non-remittance of shared revenue to Lower Local Governments
Fifth schedule, Part V (15A) of the Local Governments Act 1997 requires that a Town
Council should distribute 5% and 20% of the total Local revenue collected amongst its
Parishes and Village Councils respectively.
However, it was observed that Council did not remit UGX 20,850,078 to Parishes and
Village Councils as shared Local revenue as required by the Act.
The Accounting Officer explained that Council implemented the planned activities on
their behalf because they were not legally constituted to authorize opening of bank
accounts and those currently serving as LC II Chairpersons and their executives were
just interim and not recognized by the electoral commission.
Failure to remit the funds to the village Councils & wards impairs service delivery at
grassroots and contravenes the deCentralization principle that underpins participation
and involvement of communities in implementation of Government Programmes.
I advised the Accounting Officer to always ensure that remittances to lower Local
Councils in accordance with the laws and on a timely manner.
49
5.2.3. HOIMA DLG
1. Under collection of Contracted out Local Revenue
Regulation 32 of the Local Governments Financial and Accounting Regulations, 2007
requires all revenue to be collected as budgeted. However, out of the amount of
UGX.47,526,000 of revenue contracted out, UGX.13,132,000 was realized leaving a
balance of UGX.34,394,000 as shown below:-
Revenue
source
Contractor Contract
Price
(UGX)
Actual
amount
Collected
Un-realised
UGX
Buseruka main
market
Kibalyerainda
John
2,124,000 NIL 2,124,000
Kinogozi Market Bahemuka
Julius
2,124,000 NIL 2,124,000
wagesa market Sunday Ayubu 19,532,000 NIL 19,532,000
Buhuka Market ByaruhangaIss
a
12,390,000 3,850,000 8,540,000
Rwenzori Market Bahemuka
Julius
3,000,000 2,980,000 20,000
Butimba Market Mugisa John 2,285,000 2,052,000 233,000
Buhimba main
market
Serukera Tadeo 2,118,100 1,250,000 868,100
Kijangi landing
site
Kibalyerainda
John
3,953,000 3,000,000 953,000
TOTAL 47,526,100 13,132,000 34,394,100
The Accounting Officer explained that management had put in place a revenue
enhancement review Committee that reviews revenue performance every quarter.
I advised the Accounting Officer to ensure that revenue collection is closely supervised
and that in future all revenue budgeted is collected. Meanwhile, Council should follow
the contractors for recovery.
50
5.2.4. HOIMA MC
1. Diversion of capacity building funds
I carried out inspection of the Municipal Council and it was observed that capacity
building expenditure worth UGX 7,200,000 was executed outside the Council’s work
plan. Diversion of funds from the planned activities translates into misallocation of
resources.
The Accounting Officer responded that the Municipal Council was advised to refund the
funds spent outside USMID activities.
The promised action is awaited.
5.2.5. KASESE DLG
1. SERVICE DELIVERY
7. Supply and Installation of six 40HP Maize Mills
The District contracted Mupala Agency Ltd to supply and install six Maize Mills in 3 Sub
Counties, 2 Divisions & 1 Town Council at a contract price of UGX 113,704,800 under
contract number KSE/521/SUPLS/2014/2015/00006. At the time of the audit (July 2015)
UGX 113,704,800 had already been paid to the contractor.
The inspection of the facilities revealed that the maize mill had not been installed. This
was as a result of inadequate power supply. The mills require a three phase power
connectivity to enable them operate which was not in place where the machines were to
be installed. It appears the venture was not properly planned. There is therefore a high
likelihood of the mills not being installed leading to waste of resource.
The Accounting Officer explained that the mills were installed however, for them to be
connected to a three phase power; each beneficiary group had to pay UGX 6,000,000
which the groups could not afford. The matter requires urgent attention.
8. Health Service Delivery
Paragraph 2.1.2 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
51
for proper functioning of Health centres. An inspection of selected health centres
revealed the following short comings:-
a) Kabatunda HC III
Minimum Standard HC III Current Status
Maternity ward No maternity ward
2 General wards Only 1 general ward
1 Medical waste pit No medical waste pit
Placenta pit No placenta pit
8 of 2 stance pit latrine Only 2 of 2 stance pit latrine
18 staff Only 8 staff available
Transport No transport available
b) Nyamirame HC IV
Minimum Standard HC IV Current Status
Maternity ward Non
Mortuary Non
1 General ward Non
10 of 2 stance latrines 1 of 4 stance latrine
48 required staff Only 17 staff
Transport in case of emergency No transport
The above shortcomings hinder effective health service delivery in the district.
The Accounting Officer explained that Council had initiated a vigorous lobbying
campaign to raise funds.
I advised the Accounting Officer to engage the Ministry of Health to ensure that the
issues affecting the health services are addressed.
2. Construction of the 5Km Road barrier – MahangoMuhokya Road
The District embarked on the construction of Mahango Muhokya road under Force on
Account at a cost of UGX 137,874,050. According to the Bills of Quantities, civil works
included site clearing, blasting of the rock, grading and culvert construction. The works
started in November 2014 but the project completion date remained undefined.
It was however, observed that an amount of UGX.251,732,500 had been expended by
the time of audit in July 2015, implying an excess expenditure of UGX.113,858,450 over
52
the budget. This is despite of the fact that only site clearing and blasting of the rock
had been done.
It appears the variation was not well planned given the capacity of the district to
undertake such project using Force Account Mechanism.
The Accounting Officer explained that this was a new road opening to the inaccessible
Mahango Sub County. He indicated that a lot more would be spent on the project.
The Accounting Officer is advised to undertake due diligence on all projects to be
undertaken prior to implementation. Meanwhile the project should be properly
supervised and be completed.
5.2.6. KAGADI TC
1. Rehabilitation of Nsubuga road
An amount of UGX.41,369,428 was incurred on opening of 3Km of Nsubuga road as
detailed below:-
Vr No. Date Payee/Contractor Details Amount
LGMSD
166 09/01/2015 Art Centre
Contractors
Opening of Nsubuga road 14,074,714
166(photo
copy)
02/03/2015 Art Centre
Contractors
Opening of Nsubuga road 6,574,714
401 03/09/2014 Karukana
Enterprises Ltd
Supply of wheel loader for 32
hrs for swamp filling of
Nsubuga road.
5,600,000
280 13/04/2015 Karukana
Enterprises Ltd
Supply of 14 culverts for
Nsubuga road
3,920,000
279 14/04/2015 Karukana
Enterprises Ltd
Hire of wheel loader for
swamp filling of Nsubuga
road
11,200,000
TOTAL 41,369,428
The road works were to start in November 2014 and be completed in June 2015.
The document action review and audit inspection revealed the following shortcomings:-
53
i) Irregular Variation of the Contract
Regulation 120 (12) Local Governments Public Procurements and Disposal of Assets
Regulations 2006 requires contract committee’s approval of any contract variation which
is more than 15% of the original price of the contract.
The contract with Art Centre Contractors to open Nsubuga Road at a contract price of
UGX.14,973,100 tax inclusive was varied to UGX.21,547,814 which was 31% above the
original contract but lacked approval. Consequently, the variation was irregular.
No explanation was provided by management to this variation.
I advised the Accounting Officer to comply with the procurement regulation.
ii) Payment for no work done
Field inspections carried out in October 2015 revealed that Item 3.2.2 of the BOQ
provided for side drains at cost of UGX 5,350,500.
However, the side and mitre drains were not constructed yet the contractor was paid.
The Accounting Officer explained that works for this road were carried forward to
financial year 2015/2016.
The matter requires urgent attention.
5.2.7. MASINDI MC
1. Non remittance of shared Local revenue collection
Part V Section 14 (2) of the Fifth Schedule of the Local Governments Act 1997 (as
amended) CAP 243, requires Council to distribute at least 30% of its revenue collection
to division Councils in its area of jurisdiction on a monthly basis.
Council did not remit an amount of UGX 149,380,756 to Lower Councils contrary to the
regulations.
Failure to remit funds impairs implementation of activities at the Lower Parishes and
Villages.
The Accounting Officer explained that a sum of UGX 111,048,716 had actually been
remitted leaving a balance of UGX.38,332,040 by close of the year.
54
However, there was no evidence of remittance of funds to the Village Councils to
support the explanation.
I advised the Accounting Officer to ensure the funds are remitted to the lower Councils
in accordance with the law.
5.2.8. KYEGEGWA DLG
1.Anesthetic Machine lying idle in Kyegegwa Health Centre IV
The District received the Anesthetic Machine (DatexOhmeda) as a donation from
Belgium Technical Cooperation (BTC) on the 21st/1/2014. It was however, observed
that the machine uses Halothane, Isoflurane, Oxygen and Sevoflurane which National
Medical stores does not supply. Accordingly, the machine has been rendered idle.
I advised the Accounting Officer to follow up with the Ministry of Health to ensure that
the machine is put to use.
5.2.9. KIRYANDONGO DLG
1. Outstanding Utility Bills for Kiryandongo Hospital
The Local Governments Financial and Accounting Manual, 2007 require all Local
Governments recurrent and capital development expenditure transactions to be process
through the commitment control system (CCS).
However, it was observed that the hospital had outstanding electricity bill amounting to
UGX 34,444,192 on Account No 200372524 as at 30th June 2015.
The hospital is at a risk of power disconnection.
The Accounting Officer attributed the outstanding bill to the the expansion of the
Hospital and said that efforts are being made by management to have the Bills paid.
I advised the Accounting Officer to ensure that the outstanding bill is settled promptly.
55
2. Absconded Staff not deleted from Payroll
Public Service Standing Orders 2010 (B-a) (12), requires the payment of salary to be
stopped as soon as an individual ceases rendering services to Government.
However, it was observed that UGX 7,009,394 was lost as a result of staff who
continued to access the payroll despite their abscondment from duty.
The Accounting Officer admitted the shortcoming and explained that a number of staff
who had absconded and others who had died had not been deleted immediately on the
system because the information relating to them did not reach management in time for
action. He promised to effect recovery at the time of processing their gratuity and
pension.
The Accounting Officer is advised to strengthen controls on payroll management to
ensure that only genuine staffs are paid.
5.2.10. BWEYALE TC
1. Lack of Valuation List
Section 4 of the Local Governments (Rating) Act requires the Council to review its
valuation list at least once in every 5 years, or such longer period as the Minister may
approve.
However, it was observed that the Council did not have an up-to-date valuation list.
There is a risk that property rates as a source of Local revenue might not be exploited to
its full potential and besides the applied rates may be below the current market rates.
The short coming was attributed to inadequacy of funds to conduct the valuation
exercise.
I advised the Accounting Officer to ensure that the activity is prioritised during
budgeting and funds allocated to update the valuation list.
56
5.2.11. KYENJOJO TC
1. Lack of an Up-to-date Valuation List
Section 4 of the Local Governments Rating Act requires the Council to review its
valuation list at least once in every 5 years, or such longer period as the Minister may
approve.
However, it was observed that the Council did not have an up-to-date revenue valuation
list. There is a risk that property rates as a source of Local revenue might not be
exploited to its full potential and besides the applied rates may be below the current
market rates.
The Accounting Officer explained that the mechanisms have been put in place to have
the list updated.
I advised the Accounting Officer to ensure that the activity is prioritised during
budgeting and funds allocated to update the valuation list.
5.2.12. KATOOKE TC
1. Failure to update the Valuation Lists
Section 4 of the Local Governments (Rating) Act requires the Council to review its
Valuation list at least once in every 5 years, or such longer period as the Minister may
approve.
It was observed that the Town Council did not have an up to-date valuation list.
There is a risk that property rates as a source of Local revenue might not be exploited to
its full potential and that the applied rates may be below the current market rates in the
Council operating environment.
The Accounting Officer admitted the shortcoming and attributed it lack of funding.
The Accounting Officer was advised to prioritise the activity and allocate funds for
updating the valuation list.
57
2. Service Delivery
2.1 Improvement of Nathan – Asuman swamp (0.1km) Road
The improvement of Nathan-Asuman swamp was scheduled to begin from 22nd August
2014 and end by 19th September 2015 at a cost of UGX.3,000,000.
Works included bush clearing, grading, gravelling and reshaping of poor sections of the
road. During the audit inspection carried out on 13/11/2015 the following shortcomings
were identified:-
The gravel had been eroded
The road was already developing gullies due to the poor drainage system as shown
below;
Gullies seen on swamp and some sections of the road already eroded
The Accounting Officer explained that the allocated budget by Council for the road was
inadequate and did not allow for a sustainable service.
The Accounting Officer was advised to ensure that poor works are properly supervised
and value for money achieved.
3. Periodic maintenance of Kyamunianya swamp 0.1km
Council set out to conduct periodic maintenance of Mukole-Kahanda market
(Kyamunianya swamp 0.1km) at a cost of UGX 10,563,401. The work was scheduled to
commence on 23rd April 2015 and end on 29th May 2015.
Works included bush clearing, grading and reshaping of poor sections at the cost of
UGX.10,563,401. During audit inspection carried out on 13/11/2015 the following
shortcomings were identified;
There were no headwalls installed at the culvert
58
Some culverts were already broken
Culverts were not aligned in a straight line.
Pot holes were already developing at the bridge
The Accounting Officer explained that the allocated budget by Council for the road was
small and did not allow for a sustainable service of which some of the funds had been
diverted to another swamp.
The matter requires urgent attention.
5.2.13. NTOROKO DLG
1. Periodic Maintenance of Rwebisengo-Rwangara Road, Spot Graveling &
Shaping 16Km of 32.5Km
Paragraph 3.5.4 (6) of the LGFAM (2007) requires each activity to have its own work
plan and budget. This is further supported by paragraph 5.4 of the Force on Account
Guidelines Revised (Planning for Mechanised Routine Maintenance).
Periodic maintenance of Rwebisengo-Rwangara road was executed in February 2015
under Force on Account, at the cost of UGX 34,000,000.
At the time of inspections in August 2015, it was observed that the works had been
completed and all the payments made but the entire road was in a sorry state with
potholes as shown below;
This was due to poor quality grading and shaping of the road.
The Accounting Officer attributed the shortcoming to inadequate funding to maintain the
32 Km road with heavy traffic.
I advised the Accounting Officer to ensure proper supervision of the road works.
59
5.3 GULU BRANCH
5.3.1. APAC DLG
1. Unsupported Payment of Domestic Arrears
A review of cash flow statement revealed that domestic arrears paid during the year
amounted to UGX 3,789,821,272. However, the supporting documents were not
provided for audit. Besides the Statement of Outstanding commitments as at 30th June
2014 on Page 50 of the Financial Statements shows a balance of only UGX 23,085,261.
In addition, the same statement of outstanding commitments reported outstanding
statement of UGX.200,698,807 by 30th June 2015 whereas a schedule of accounts
payable on page 52 reported a balance of UGX.127,830,185 rendering the Financial
Statement balances reported misleading.
The Accounting Officer explained that there was a mix-up since monthly arrears cleared
within FY 2014/15 was added to the arrears of the 2013/14 for the year and they have
separated the arrears of previous financial year. There was however no change in the
financial statements.
I advised the Accounting Officer to reconcile the balances and make the necessary
adjustments.
2. Unauthorized Reallocation
Regulation 44 (1) of the Local Governments Financial and Accounting Regulations
(LGFAR) 2007 requires the vote controller to ensure that expenditure is not incurred in
excess of provisions authorized in the approved estimates or as may be amended by
properly authorized virement, reallocation and supplementary estimates. However,
reallocations amounting to UGX 4,532,761,373 were made on four programs without
authority and proper reallocation warrants as detailed below:
Code Item Budget Actual Variance
06 Education and Sports 9,711,475,000 13,481,894,421 3,770,419,421
09 Community based
services
208,696,000 400,379,695 191,683,695
60
Code Item Budget Actual Variance
10 Planning Unit 223,744,000 794,402,257 570,658,257
TOTAL 4,532,761,373
The Accounting Officer admitted the shortcoming and pledged to ensure proper
budgetary planning and ensure reallocations are properly authorized.
I advised the Accounting Officer to comply with the budgetary control measures.
3. Road Works
3.1 Abandoned Low cost road sealing
The District contracted a local firm for construction of a Low Cost Sealing road of 2kms
at UGX 363,143,268. The contract was awarded on 6th June 2014 and completion date
was 19th December 2014.
By the time of inspection in August 2015, UGX 104,636,723 representing (29%) of the
contract price had been paid. However, the works had been abandoned by the
Contractor as shown below:
Bitumen materials abondoned on the site
Road section where work was to be done.
The Accounting Officer explained that the Contractor was not on site at the time of
inspection. However, the Bitumen for sealing works was at site and the Contractor
returned to the site. The delay was attributed to the break-down of district equipment.
I advised the Accounting Officer to ensure the works are completed.
61
5.3.2. AGAGO DLG
1. Nugatory Expenditure
Section 9 (2b) of the Local Governments (Financial and Accounting) regulations 2007,
provides for the duties of the Chief Executive, among others to ensure that the public
monies, property and resources for which he or she is responsible as Accounting Officer
are properly managed and safe guarded.
During the financial year UGX 156,501,982 was withdrawn by Uganda Revenue
Authority from Health, Education and Local Government Management Service Delivery
Programme as a penalty for non-remittance of Withholding Tax and Pay As You Earn for
the year ended 2014 as shown below.
VR. No.
Date Payee Details Amount
3 03/05/2015 URA Money drawn from the district accounts for failure to remit taxes during the financial year 13/14. thus payment of the liability plus interest
57,888,664
Education Account
31/3/15 URA Money drawn from the district accounts for failure to remit taxes during the financial year 13/14. thus payment of the liability plus interest
48,613,318
Health Account
17 31/03/2015 URA Money drawn from the district accounts for failure to remit taxes during the financial year 13/14. thus payment of the liability plus interest
50,000,000
GRAND TOTAL 156,501,982
The tax penalties would have been avoided if there was tax compliance. Consequently,
the expenditure incurred is nugatory. I advised the Accounting Officer to ensure
compliance with the Income Tax Law to avoid fines and penalties.
62
5.3.3. ALEBTONG DLG
1. Lack of Basic Facilities in Kakira Primary School
The Local Governments Service Management and Service Delivery (LGMSD) program
guidelines require schools to have enough classrooms and infrastructure.
An inspection carried out at Kakira Primary School revealed that the school lacked
adequate infrastructure. The buildings were dilapidated and the furniture was not
enough. Consequently, pupils sit on the floor as shown below;
Pupils seated on the floor
The Accounting Officer attributed the condition of the school to inadequate funding.
I advised the Accounting Officer to liaise with Ministry of Education and Sports to
provide the necessary infrastructure.
5.3.4. GULU DLG
1. Payment of Salary to staff not on District List
Section (B-a) of the Public Service Standing Orders, 2010 require that salaries shall be
fixed at annual rates and paid in twelve (12) equal instalments, correctly and promptly
and in lump sum in accordance with the approved salary structure of the Public Service.
However, it was observed that UGX.71,972,777 was paid to employees whose names
were appearing on the payroll but not on the district staff list. There is a risk of public
funds being lost through salary payments to non bonafide employees.
63
The Accounting Officer stated that she was awaiting the results of the special audit
being carried out by the District Internal Audit.
I advise the Accounting Officer to harmonise the payroll and ensure proper review and
payroll management.
2. Duplicate/Triplicate Names on the Payroll
Section (B-a) (7) of the Public Service Standing orders, 2010 requires salaries to be paid
correctly in accordance with approved salary structure for Public Service. A review of
the two months (July 2014 and February 2015) payroll records reveal that there were a
number of duplicates and triplicate names for employees. These names were identified
as employees with the same names, supplier numbers, same bank and same bank
account number. Employees in this category were paid thrice and/or twice a month for
that period under review amounting to UGX 112,808,177.
The Accounting Officer stated that there was an ongoing special audit which was being
undertaken by the District Internal Audit for which they expect a report in two months’
time.
I advised the Accounting Officer to ensure proper payroll management by clearing the
payroll immediately to avoid duplicate payments.
3. Delayed Completion of Works
Audit inspections were carried out in November 2015 on various contracts awarded to
various service providers to assess their performance and the following matters were
observed:-
64
Contractor Description Contract Period
Amount Paid
Audit Observation
Omatala Women Group Contract Sum UGX.65,284,450
Renovation of Operating Theatre at Wach Health Centre IV
Start and end dates were; 10/1/2015 and 16/04/2015 respectively
23,728,768 The contract period had expired but was not extended
The works were incomplete i.e. final touches and the painting were not yet done.
Contractor had abandoned the site.
Ms Lado Construction (U) Ltd Contract sum UGX.75,311,300
Construction of staff house at Pagik P/S
Start and end dates were; 02/12/2014 and 06/01/2015 respectively
31,180,330 The contract period had expired but was not extended
The project had been abandoned
Contract documents not maintained to a certain level of management.
Ms Rapon Ltd Contract sum UGX.315,457,453
Construction of Odek bridge along Acet-Jinkomi Road
Start and end dates were; 18/11/2014 and 31/05,2015 respectively
The contract period expired and not extended.
The contractor had abandoned the project and the road was completely impassable
Delayed completion of works delays communities’ prompt service delivery. The
accounting Officer admitted that the works stalled and stated that the contractors had
abandoned the works.
I advised the Accounting Officer to ensure that the works are completed.
5.3.5. KOLE DLG
1 Service Delivery
1.1 Aboke HC.IV
An audit inspection was carried out on Aboke Health Centre IV to assess the conditions
of the Health Centre’s infrastructure and the following shortcomings were identified:-
65
The hospital is not fenced exposing the facility to security challenges as shown
below:
Animals grazing freely at the hospital premises
The buildings are dilapidated and in a sorry state as below:
Dilapidated buildings
There is need for urgent renovation.
There are only two (2) toilets which are about to collapse.
66
One of the functioning toilet with a deep
hole traced to the stance prone to
collapse
Abandoned toilet which can act
as a harbor for snakes and also
risky to children since the pits are
not closed
Expired drugs were damped along Alyat Swamp a short distance away from the
Health facility. However, some expired drugs were stored in the same shelves with
the drugs in use.
The Accounting Officer admitted the shortcomings and indicated the rehabilitation of
Aboke HC IV has started.
I advised the Accounting Officer to liaise with the Ministry of Health and ensure that the
Health Centre is rehabilitated.
5.3.6. KITGUM DLG
1. Inspection of Kitgum Main Hospital
The audit inspection of Kitgum main Hospital revealed that some of the structures at the
Hospital were in a sorry state and required urgent renovation. It was observed that
condemned structures were being used as Tuberculosis wing and others as stores as
shown in photos below:
67
Pictures of scenes at Kitgum Hospital
Dilapidated structures -stores and the TB department/wing
It was further observed that some drugs were piled on the floor instead of pallets. This
puts the drugs to a higher risk of expiration because of moist conditions.
The Accounting Officer explained that the Hospital was meant to be in the first phase of
renovation by the Ministry of Health under the Uganda Health Sector Strategic Plan
(UHSSP) but missed the opportunity and the hospital is now scheduled to be renovated
in the second phase.
I advised the Accounting Officer to follow up the matter with the Ministry of Health to
ensure renovation is undertaken.
2. Stalled Projects
Audit inspection carried out in June 2015 on various projects rolled over from the
previous year, revealed that some projects had stalled as shown below:-
68
Contractor Description Contract Period Amount Paid Audit Observation
Ms United Orphans Company Ltd Contract sum UGX.37,000,000
Construction of one block of two classrooms at Lagoro Seed Secondary School
Start and end dates were; 07/02/02011 and 07/05/2011
Construction had stalled for more than 4 years and the structures were being continuously eroded away by weather effects.
No contract
documents were maintained to ascertain the level of management follow ups.
Originally Ms Omrid General Enterprises Contract sum; UGX.114,963,600 Later, UGX.85,000,000 advanced to Health department to complete
Completion of children’s ward at Omiya-Anyima Health Centre
UGX.22,860,000 paid to Omrid General Enterprises (Contractor) UGX.85,000,000 advanced to Health department
No works were done by contractor after receiving advance of UGX.22,860,000
Advance to Contractor had not yet been recovered.
Works were on-going by Health department
Ms Gemodwong Enterprises Ltd Contract Sum; UGX.48,503,782
Construction of staff houses at Camgweng Primary School
Contract Agreement signed on 16th May 2011
Construction had stalled for more than 4 years.
The structures were eroded away by weather effects.
No contract
documents were maintained to ascertain the level of management follow up efforts.
The Accounting Officer attributed the delay to the interdiction of; the then substantive
Chief Administrative Officer which led to failure by Contractors to access funds which
eventually was returned to the Treasury. The Accounting Officer further explained that
Ms Omrid General Enterprise (Contractor) was being prosecuted by President’s Office.
69
I advised the Accounting Officer to initiate measures to ensure that the civil works are
completed.
5.3.7. LAMWO DLG
1. Road Works
1.1 Incomplete Project
Audit inspections carried out on two road rehabilitation to assess the condition of the
roads and status of work done revealed the shortcomings:-
Contractor Description Contract Period
Amount Paid (UGX)
Audit Observation
Ms Lab Plus (U) Ltd Contract Sum UGX159,945,370
Installation of culverts on Palabek Kal-lokung road and vented drift construction on Limur Stream
Start and End dates were 28/02/2014 and 30/06/2014 respectively
110,629,607 Although the contractor demobilized from the site and culverts were left hanging with no headwalls.
The contractor started work on 11/04/2014 and stopped work on 30/09/2014. He later abandoned work.
Broken culverts created large holes in the middle of the road.
Work on the vented drift had not been completed.
70
Contractor Description Contract Period
Amount Paid (UGX)
Audit Observation
Force on Account
Rehabilitation of Gem Central Pawena Road
UGX 206,953,600
Head walls for some culvert lines had not been constructed. The headwalls had been costed at UGX.7,402,600
Some sections of the road were not compacted.
Some sections of the road were not graveled though budgeted for at UGX.103,372,000
The Accounting Officer stated that the works had now been completed using the Force
on Account for both projects.
I advised the Accounting Officer to follow up the contractor who failed to complete the
works and indicate the source of funds for completion of the two projects using Force on
Account Mechanism.
5.3.8. LIRA DLG
1. Delayed Completion of Lira-Soroti Road
The audit of the construction of Low Cost Sealing at Boroboro-Lira Soroti road, at a
contract sum of 199,447,169 revealed the following shortcomings:
71
Contractor Description Contract
Period
Amount Paid
(UGX)
Audit Observation
MS Pehan
Construction Ltd
Contract sum
UGX.199,447,169
Construction
of a low cost
Sealing at
Boroboro-Lira
Soroti Road
Start and end
dates were;
04/11/2014
and
4/02/2015
103,934,608 Partial works had
been done
The contract period
had expired and not
been extended
There procurement
irregularities observed
namely;
No record of bid
documents and
submission
documents contrary
to Regulation
LGPDAR 2006
Delayed completion of projects denies the community prompt service delivery.
Delayed completion of the works was attributed to lack of capacity by the contractor and
lack of close supervision.
I advised the Accounting Officer to enhance supervision and ensure that work is
completed in a timely manner.
2. Health Equipment Donated To Ogur HC IV
Regulation 9(2) (j) of the Local Government Financial and Accounting Regulations,
requires the chief executive to establish proper storage facilities with accounting and
financial control systems to ensure efficient receipt, issue and safe custody of stores,
vehicles, plant and other assets. The Health Centre IV received a donation of Health
equipment worth US $450,000 from NUHITES and USAID programmes. However, the
72
equipment was not availed for physical inspection. There is a risk that the equipment
could have been lost.
The Accounting Officer promised to follow up the matter and ensure that the equipment
is availed for audit verification.
I urged the Accounting Officer to follow up matter and ensure that the items are made
available for audit verification.
5.3.9. PADER DLG
1 Transfers to Un operational Institutions
According to quarterly releases to the Local Government a total of UGX.161,056,000 was
transferred from the Ministry of Education and Sports to Pader Technical and Farm
School on a quarterly basis via the district vote 547 as shown below:
However, it was observed that the Technical school was not operational in the district
rendering the transfer fictitious. In my previous reports, I reported that Operational
Funds amounting to UGX.555,933,000 were transferred to the same Technical and farm
School for the financial years 2012/2013 and 2013/2014.
The Accounting Officer explained that Pader Technical Farm School exists in Pader Sub
County but for the last three financial years (2012/2013, 2013/2014) and (2014/2015) it
is under construction. The Accounting Officer further stated that Inspector General of
Government regional office, Gulu is already investigating the matter. However, he
stated that since the monies were direct transfers to the institution yet to be
operationalized, the Ministry of Education and Sports is responsible because it advises
the PS/ST for the releases.
School Quarter 1 Quarter 2 Quarter 3 Quarter 4 Quarter 5
Technical
and Farm
School
40,264,000 40,264,000 40,264,000 40,264,000 161,056,000
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I advised the Accounting Officer to follow up the funds with the Institution to ensure
proper utilization.
2. Delayed Completion of Civil Works
It was observed that a contract amounting to UGX 71,004,310 was awarded to a Local
firm for construction of three classroom block at Lacekocot Primary School. By the time
of audit, October 2015 a sum of UGX 63,903,879 representing 90% of the contract sum
had been paid, however, the works had not been completed and the contract period had
expired as shown below:
Contract Description Contract
Period
Amount Paid Audit Remarks
MS Loborom
Company Ltd
Contract sum
UGX.71,004,310
Construction of
3 classroom
block at
Lacekocot
Primary School
The start and
end dates
were
10/12/2014
and 11/3/2015
respectively
63,903,879 The contract
period had expired
and had not been
renewed. The
construction was
incomplete and
the contractor had
abandoned the
site.
The delayed completions of works deny the community the timely services.
The Accounting Officer explained that Council had recommended the contractor to be
terminated and a new one sought to complete the works.
The matter requires urgent attention.
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5.4 JINJA BRANCH
5.4.1. BUGIRI DLG
1 Poor Contracts Management
Local Government Public Procurement and Disposal of Assets(LGPPDA) 119(3) states
that upon receipt of a copy of a contract, the contract supervisor shall prepare a
contract implementation plan and forward a copy to the head of user department,
secretary of the contracts committee among others for monitoring purposes.
Additionally, section 119(10) f, requires the contract manager to submit reports on the
progress or completion of a contract as required by PDU or the Accounting Officer.
It was however, observed that contract managers for a sample of projects worth
UGX.490, 392,030 did not have implementation plans on file. In addition, no reports on
progress or completion were presented for verification.
Poor management of contracts may result in paying for shoddy works and poor service
delivery.
The Accounting Officer admitted the shortcoming and pledged to effect corrective
measures.
I advised the Accounting Officer to always ensure proper supervision and
implementation of the contracts.
5.4.2. BUYENDE DLG
1. Supplementary Budget
Local Government Financial Accounting Regulations (LGFAR), 2007 requires that if new
or additional funds are required over and above the approved budgetary provisions,
which cannot be met by virement or re-allocation, the vote controllers concerned shall
apply to the Chief Executive for a Supplementary provision.
However, it was observed that, the budget was revised from UGX 14,564,405,571 to
UGX 16, 052,290,612 representing an increase of UGX 1,487,885,041.
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However, there was no evidence that the supplementary was approved by the District
Council. The Accounting Officer had indicated that approval was obtained but no
minutes of Council were presented for audit verification.
I advised the Accounting Officer to comply with the regulations and to provide evidence
of Council approval for audit verification.
2. Service Delivery
2.1 District Health Service Delivery
Paragraph 2.1.1 (D) of the Local Government Management and Service Delivery
(LGMSD) program Operational Manual for Local Governments 2009 sets minimum
standards for proper functioning of Health Centres.
However, inspection of the health centres revealed that most of the basic minimum
standards were not met as summarized in the table below;
a) Kidera Health Centre IV
Package Minimum standard
Observation Remarks
Operational Theatre
1 1 Non Functional due to lack of personnel, has no capacity to transfuse blood
Means of Transport
Reliable 0 Ambulance needs repairs, has been grounded for three years
Power Source Reliable 0 Solar is functional only in the theatre, Grid was disconnected due to failure to meet electricity bills
Doctors
Staff Houses 11 7 15 staff accommodated while 23 staff are not
Waste Pit 1 0 Medical waste burnt in an open area
OPD 1 1 No shade for patients
Water Source Reliable 1 Functional Borehole, Running water was disconnected due to failure to pay water bills
Incinerator Functioning Not functioning
Was constructed last year at a cost of UGX 10,000,000 however, it has not functioned till to date
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b) Bugaya Health Centre III
c) Irundu Health Centre III
Package Minimum standard
District status
Remarks
Maternity 1 1 No delivery beds
Water Supply
1 No reliable water source
General Ward
2 1 Male, female and children share one ward
Staff Houses
5 3 Nine staff accommodated, 8 staff commute
Latrine Stances
16 15 Adequate
d) Health Services Accessibility indicators
Category District status Minimum Standard
Practicing Doctor: population ratio: 1:160259 1:24,000
Nurse: Population ratio: 1:11447 1:1700
Midwives: pregnant women (15-49) ratio: 1:518 1:9000
Accounting Officer attributed the gaps to financial constraints but indicated that she was
engaging the political leadership, funding Ministries and agencies for readdress.
I urged the Accounting Officer to follow up with Ministry of Health and Ministry of
Finance and Economic Development and other stakeholders to ensure that the above
shortcomings are resolved.
Package Minimum standard
Observation Remarks
Maternity 1 1 No delivery beds.
Water Supply 1 0 No reliable water source.
General Ward 2 0 Part of the maternity converted to a general ward.
Staff Houses 5 2 Five staff accommodated, 10 staff commute from kamuli Town.
Latrine Stances 16 5 Patients and workers share Latrines.
Medical waste pit
1 0 Medical waste is burnt in an open area.
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3.1 Education Service Delivery
a)
b) Inadequate standards in Primary Schools
Section 2.1.1 (a) of the Local Governments Management and Service Delivery (LGMSD)
operational Manual 2009 and 2.1.2 (a) requires Local Governments to deliver services in
conformity with Primary Education Minimum National Standards of Service Delivery
(MNSSD).
Analysis of the school statistics for the schools in the district revealed that the standards
w
e
r
e
b
e
l
ow minimum as shown in the table below;
Education accessibility indicators 2011-2014
Pupils of Nkone Primary School P.4 class pictured during a teachng session
2011 2012 2013 2014
Level of
education
Pupil Teach
er Ratio
Pupil Classro
om Ratio
Pupil Teacher
Ratio
Pupil Classroom
Ratio
Pupil Teach
er Ratio
Pupil Classro
om Ratio
Pupil Teacher
Ratio
Pupil Classroo
m Ratio
Primar
y
1:95 1:180 1:66 1:170 1:61 1:131 1:61 1:126
Secondary
1:75 1:84 1:70 1:82 1:68 1:75 1:85 1:90
MNSSD
1:55 1:55 1:55 1:55 1:55 1:55 1:55 1:55
Indicator Ratio MNSSD
Pupil: Latrine stance ratio: 1:93 1:40
Pupil: Desk ratio: 1:5 1:3
Pupil: Textbook ratio: 1:65 1:3
Drop-out rate: 42% O
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Shortage of teachers, inadequate classrooms, inadequate desks and inadequate pit
latrines (stances) negatively affect student performance which had a failure rate of
50%. Accounting Officer explained that she was engaging the Ministry of Education and
Sports and other stakeholders to increase on the funds so as to address the
shortcomings.
I advised the Accounting Officer to lobby Government for the necessary support to
address the above shortcomings in order to improve the performance of the schools.
5.4.3. IGANGA DLG
1. Encroachment on Forest Reserve
Regulation 9 (j) of the LGFAR 2007, requires the Accounting Officer to ensure safe
custody of all assets of the District.
It was observed that , Nabukolyo Local Forest Reserve, a permanent wetland with 16
Hectares had been encroached on by Rice growers while 32 hectares of Wakatanga
Local Forest Reserve had been encroached on by Maize farmers.
The Accounting Officer explained that the district had joined hands with National
Forestry Authority to handle the issue.
The matter requires urgent attention.
2. Service Delivery
2.1 Education Sector
a) Standards of Education in Primary Schools
The Local Governments Management and Service Delivery (LGMSD) operational manual
section 2.1.2 (a) Program2.1.2 (a) requires Local Governments to deliver services in
conformity with Primary education minimum national standards of service delivery.
Documentation review revealed that the district standards are below the national
standards as shown in a table below;
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Table of School Infrastructure
No. Ratio National Standard Average of (33) schools
1 Classroom : Pupil 1:55 1:94
2 Latrine: Pupil 1:40 1:90
3 Desk:Pupil 1:3 1:7
Inadequate infrastructure negatively affects the academic performance.
The Accounting Officer is advised to engage the Ministry of Education to address the
matter.
2.2 Inspection of Health Centers and the Hospital
Paragraph 2.1.1 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
for proper functioning of health centers.
a) Patient Over Load
Review of health inspections reports for the year revealed that the District health
services has a patient over load compared to the set national standards which has
slowed down the progress of the District in meeting the national development goals
shown in tables below;
Cadre National standard Iganga District
Doctor 1:24000 1:36200
Nurses 1:1700 1:3291
Consequently, the medical staff are over worked and the facilities not sufficient.
The inspection of the health facilities revealed the following shortcomings:
b) Health Centers
An audit inspection of the Health Centres of Igombe HC III, Nawandala HC III, Ituba HC
II and Buyanga HC II also revealed the following shortcomings;
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1. Igombe HC III
Minimum standard HC 111 Current status
one Maternity ward No maternity ward
Basic accommodation for all core staff None out of 8 staff is accommodated
Power source No power supply. The solar system supplied in July 2011 broke down
Eight two stance pit latrines One 4 stance pit latrine
Medicines
Lacked items like gauze, cotton wool and medicine like mabendazole, Vit A, cycline capsules, phelasulphate, amoxyll, phenobabitom, magnesium, pilton, injection peninciline and metronendazole
2. Nawandala HC III
Minimum standard Current status
Two general wards One mixed ward for both men and women
Basic accommodation for all core staff
The health center has 3 medical workers out of 11 accommodated. Staff quarters are still under construction; however, they lack a toilet.
3. Buyanga HC II
The Accounting Officer acknowledged the above shortcomings and attributed them to
inadequate funding.
I advised the Accounting Officer to engage the Ministry of Health to address the matter.
Minimum standard HC 11 Current status
Basic accommodation for all core staff
No accomodation
Power source No power source
One Water source No water source; nearest borehole is in Dhakhaba Primary School 1/2km away
Medical equipment No weighing scale for adults, no fridge and medicine like Panadol, amoxyll, injectables, promathavane among others plus uniforms
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5.4.4. IGANGA MC
1. Unpaid Salary Arrears
Section B, Paragraph 25 of the Public Service Standing Orders, 2010 provides that salary
arrears that accrue to a public officer within a financial year shall be paid through the
payroll within the same financial year.
However, it was observed, that Council had accumulated staff salary arrears amounting
to UGX. 100,745,400.
Failure to pay employees’ salaries in time demotivates staff and negatively impacts on
service delivery.
The Accounting Officer attributed this to inadequate funding of the wage bill.
I advised the Accounting Officer to liaise with the Ministry of Public Service and the
Ministry of Finance Planning and Economic Development to ensure that the salary
arrears are settled.
2. Service delivery
2.1 Education Sector
a) Standards in sampled primary schools
Paragraph 2.1.2 (a) of the Local Governments Management and Service Delivery
(LGMSD) Operational Manual for 2009 sets the minimum national standards for delivery
of Primary Education.
A review of the education standards as at 30th June 2015 in sampled primary schools
revealed that the schools were not meeting the required national standards as shown
below;
School requires national standards
Classroom : Pupil 1:55 Latrine : Pupil 1:40
Teacher : House 1:4
Iganga Municipal Council
1:90 1:90 1:4
Igamba Primary School 1:73 1:63 1:30
Bugumba Noor Islamic Primary School
1:49 1:22 Nil
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School requires national standards
Classroom : Pupil 1:55 Latrine : Pupil 1:40
Teacher : House 1:4
Kasokoso Primary School
1:68 1:64 1:36
Nakavule Primary School 1:112 1:67 1:33
Noor Islamic Primary School
1:86 1:86 Nil
Buliigo Primary School 1:55 1:49 1:15
These inadequacies impact adversely on the academic performance of the institutions.
The Accounting Officer attributed the challenges to limited funds, disbursed by the
Central Government.
I advised the Accounting Officer to engage the Ministry of Education and Sports and
other stakeholders to ensure that the above inadequacies are addressed and the
minimum national standards met.
2.2 Inspection of the Health Facilities
2.2.1 Standards in Sample Health Centres
Paragraph 2.1.1 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
for proper functioning of health centres. An inspection of selected health centres
revealed the following shortcomings:-
a) Iganga Municipal Council HC III
Minimum standard HC 111 Current status
Two staff houses type 1
One staff house type 2
Two staff houses type 3
No accommodation
Medical equipment - Fridge needs repairs
- Microscope requires routine
servicing
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b) Walugogo HC II
Minimum standard HC 11 Current status
Two staff houses type 1 No accommodation
c) Prisons HC II
Minimum standard HC 11 Current status
Two staff houses type 1 No accommodation
Three of two stance pit latrines (eco toilet) No latrines
Water source No source
The above shortcomings hinder effective health service delivery in the municipal Council.
The Accounting Officer attributed the shortcomings in health service delivery to
inadequate funding.
I advised the Accounting Officer to engage the Ministry of Health to have the issues of
health service delivery addressed.
d) Review of Health Management Committees
Section 5.4 of Ministry of Health Guidelines 2012 requires Health Unit Management
Committees to meet at least quarterly to conduct health unit business.
Audit observed that the health management committees in 3 Health Centers of
Walugogo HC II, Prisons HC II and Ignaga Municipal Council HC III did not conduct any
meetings.
Failure to meet regularly undermines the oversight roles of the committees.
The Accounting Officer admitted the shortcoming and attributed it to inadequate funding
of the health centres.
I advised the Accounting Officer to ensure that adequate funds are provided to the
management committees to enable them execute their mandate.
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5.4.5. JINJA DLG
1. Non Delivery of Medical Supplies
Audit observed that an amount of UGX. 906,061,920 had been allocated to the District
for supply of medicines by the National Medical Stores. However, it was observed that
only UGX.854,579,967 worth of drugs was supplied. The balance of UGX.84,960,928
could not be accounted for.
The non-delivery of drugs and medical supplies greatly affects the capacity of health
facilities to offer health services to the Local community.
I advised the Accounting Officer to follow up with Ministry of Health and National
Medical Stores (NMS) to ensure that the NMS honours its obligation.
2. Status of Project Implementation
2.1 Inspections of Health Facilities
District Health Service
Paragraph 2.1.1(D) of the Local Government Management and Service Delivery (LGMSD)
Program Operational Manual 2009, for Local Governments sets minimum standards for
proper functioning of health centers. However, audit inspection of a sample of Health
Centers revealed that most of the health centres did not meet basic minimum standards
as shown in the table below:
(a) Buwenge General Hospital
Minimum Requirements Current Status
Maternity ward
Operating Theatre No Operating Theatre
General Ward No General Ward
Power Source for Operations (Refrigeration, Lighting and Theatre Operations)
No Power Source though UGX.28,968,400 was deposited to UMEME for Supply of Power 0n 29th June 2015.
Budget Provision for the Hospital No Budget for Medicines and Non-Wage activities.
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Administration Block Under construction
Basic accommodation for all core staff
Lacks Accommodation for Core Staff
Basic Operating Theatre No Operating Theatre
One Pediatric ward Lacks a pediatric ward
At least one Mortuary for the Hospital Lacks a mortuary
At least one medical Waste Pit Lacks medical Pit
(b) Wakitaka Health Centre III
Minimum/Standards /Requirements
Current Status
At least one stance pit latrine for each House
Two Pit latrines for the two homes and out patients
Basic accommodation for all core staff Two out of the 19 staff are accommodated
Access to modern energy lighting for maternity and laboratory
No Power Source. Health Center was disconnected by UMEME because of outstanding bill.
(c) Bugembe Health Centre IV
Minimum/ Standards /Requirements Current Status
One General Ward No General Ward
One Mortuary No Mortuary
(d) Lumuli Health Centre II
Minimum / Standards
/Requirements
Current Status
Access to modern source of energy No Power Source
5 Beds 1 Bed
Medical Examination Bed No Examination Bed
Weighing Scale No weighing Scale
Baby Cot No baby Cot
Water Source No Water source
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Minimum / Standards
/Requirements
Current Status
One Placenta Pit No Placenta Pit
An incinerator No Incinerator
Access to modern energy lighting for
maternity and laboratory
No Power Source
(e) Mutai Health Center II
Minimum/Standards /Requirements Current Status
Basic accommodation for all core staff No staff House for Core staff
One Incinerator for the Health center No Incinerator
Inadequate health facilities have a negative impact on service delivery. This was
attributed to inadequate funding.
The matter requires urgent attention.
2.2 Education Sector
a) Assessment of the Minimum Recommended Infrastructure in Primary Schools
The Ministry of Education and sports has established the minimum national standards
(MNS). However, inspections carried out in Universal Primary Education schools revealed
that the current infrastructural status in the District schools fall below the minimum
standards in terms of classroom: pupil ratio, teacher: pupil ratio, desk: pupil ratio,
stance: pupil ratio and house: teacher ratio.
Teacher: Pupil Ratio: - The recommended ratio of teacher: pupil ratio is 1:55; whereas
the average ratio of the District was 1:35, in some schools were found to be badly off at
1:70.
Inadequate Teachers Houses: - most schools either had one teacher house or none at
all.
Text books: Pupil ratio:-although the recommended Text book pupil ratio 1:3 in most
schools its 1:15 and beyond.
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Desk Pupil ratio: - The recommended desk: pupil ratio is 1:3. However, Namulesa
Muslim Primary schools had a ratio of 1:25.
In adequate infrastructure negatively impacts on the performance of the pupils
Management acknowledged the challenges and attributed this to financial constraints
but promised to have them addressed when funds are available.
I advised the Accounting Officer to engage the relevant stake holders so that adequate
resources are mobilized for infrastructural development in the school.
C) Performance Over the Years
The following table shows primary 7 academic performance of the District over a period of
three years.
YEAR DIV(1) DIV(2) DIV(3) DIV(4) UNGRADED ABSENT Total
2012 661 3133 1753 1241 1241 383 9394
2013 612 3756 2132 1159 1328 413 9400
2014 695 3659 2066 1268 1418 348 9452
3668 3987 1144 28246
Review of performance for the last 3 Years as per the table above shows that most
primary seven candidates passed in division II.
Additionally , a significant number of Pupils (13.2%) of students passed in division 4,
implying that most of them may not have qualified for Secondary School admission due to
failure to attain minimum requirements .
According to the Accounting Officer, the poor academic performance was attributed to
inadequate infrastructure. The matter requires urgent attention.
5.4.6. KAMULI DLG
1. Delays to Lay Budget Estimates before the District Council
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Section 18(2) of the Local Government Finance and Accounting Regulation 2007 states
that the chairperson of the Local Government shall, not later than the fifth day of June
of each year, cause to be prepared and laid before the District, estimates of revenue
and expenditure and annual plans of the District for the next financial year.
However it was observed that the budget estimates for the financial year 2014/2015
were not laid before District by the 15th day of June 2014 which was in disregard of the
law. It was also noted that UGX35,657,850 was incurred without the vote on account
approval.
A delay in the approval of budget estimates implies that there will be delays in
implementing District Activities hence delays in service delivery. The Accounting Officer
attributed the delay to the Speakers refusal to convene a meeting to consider the
budget.
I advised the Accounting Officer to ensure that the budget law is strictly adhered to.
2. Expenditure
2.1 Nugatory Expenditure
Regulation 9 (2b) of the LGFAR, 2007, requires the chief executive to ensure that the
public monies, property and resources for which he or she is responsible as Accounting
Officer are properly managed and safeguarded.
However, it was observed that Court awarded Charles Akoyo (former DEO) a total sum
of UGX 267,788,936 as emoluments accrued from the time he was interdicted to the
date of the payment including interest at Court rate from the date of interdiction till
payment in full.
The costs arose when the court ruled that the interdiction and the subsequent dismissal
by the district were unlawful. The costs could have been avoided had management
taken due care in ensuring that the dismissal was lawful. Accordingly the expenditure
was nugatory.
The Accounting Officer admitted the shortcoming and attributed it to failure to follow the
logical legal provisions and safeguards.
89
The Accounting Officer should ensure that appropriate decisions making are to avoid
such nugatory expenditure.
5.4.7 KAYUNGA DLG
1. Inspection of Civil Works
It was observed that a number of projects had not been completed by the time of audit
as shown below:-
Project Amount
(UGX)
Start
date
End date Inspection
date
Status
Construction
of a staff
house with a 2 stance pit
latrine at Bungoma
primary school
65,035,575 04/12/20
14
30/05/2015 10th July 2015 Incomplete
Construction
of a staff house with a
5 stance pit
latrine at Nsiima church
of Uganda Primary
school
67,644,500 23/11/20
14
23/05/2015 10th July 2015 Incomplete
No water gutters Earthing not
installed
Painting was still ongoing
Total 132,680,075
The delay to complete the civil works can lead to extra administrative costs.
The matter requires urgent attention.
5.4.8 KAYUNGA TC
1. Lack of Legal Ownership of Council Assets
Regulation 58(4) of the Local Government Financial and Accounting Regulation (LGFAR),
2007 requires that the properties and assets of a Local Government including land be
properly registered and titles issued. However, it was observed that 4 vehicles
purportedly owned by the Town Council lacked log books.
90
In addition, the Town Council did not have land titles for the land situated in Ntenjeru
kayunga sub-county and in Kanjuki.
Consequently, I could not confirm the ownership of the assets.
The Accounting Officer, attributed the shortcoming to partial payments made on some
piece of land by the Town Council and explained further that the processes to have
them surveyed will commence thereafter.
I advised the Accounting Officer to ensure that Land Titles and Log books for Council
vehicles are secured.
5.4.9 LUUKA DLG
1. Service Delivery
1.1 Education Sector
a) Schools
Ministry of Education and Sports has established the minimum National Primary
Education Standards. On the contrary, the district performance was poor as illustrated
in the table below:-
No Indicator MNSSD Actual
1 Teacher pupil ratio 1:55 1:164
2 Classroom pupil ratio 1:55 1:198
5 Desk pupil ratio 1:3 1:9
6 Permanent teacher accommodation
At least 4 teachers per 1:25
7 Latrine stance pupil ratio 1:40 1:117
8 Building maintenance (not funded by LDG)
2%of capital expenditure budget of education
Not allocated as all funds are used for construction-No maintenance
9 No of school inspections per term (not funded by LDG)
2 1
10. Performance over years below standard
Source: The district literacy report 2015
Inadequate infrastructure negatively impacts on the academic performance of students.
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The Accounting Officer admitted the challenges and promised to have them addressed.
I advised the Accounting Officer to engage the relevant authorities to ensure that the
matters are addressed.
5.4.10 LUUKA TC
1. Lack of Health Facilities
Section 2.1.2(b) of the Local Government Service and Management Delivery opertaional
manual for Local Government require, every parish should have a health center II and
the Town Council (Sub-county) should have a health center III.
It was observed that the 5 parishes in the Town Council namely;Busonga,
Kitwekyambogo, Busimawu, Lwanda and Kiyunga, lacked a health centre as required by
the guidelines.
The communities are therefore denied public health services.
The Accounting Officer admitted the shortcoming but explained that this was due to
inadequate funding which affected the Council’s ability to construct the health centres.
I advised the Accounting Officer to engage the relevant stakeholders and ensure that
the Health Centres are established.
5.4.11 MAYUGE DLG
1. HEALTH 1.1 District Health Service Delivery
Paragraph 2.1.1 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
for proper functioning of health centers.
However, inspection of a number Health Centers revealed that most of the basic
minimum standards had not been met as summarized in the tables below:
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a) Kityerera Health Center IV
Minimum standard HC IV Current status
Basic accommodation
for all core staff
Only 10 staff out of 48
are accommodated
Adequate Medicines Inadequate drugs were observed
Transport No ambulance despite the fact that it is located
more than 50KM from the nearest Regional
referral hospital
The service delivery package for HC IV
requires a HC IV to have two doctors
The health centre operates without a doctor
Staffing Inadequate
The standard requires a health centre IV
to have two doctor’s houses.
There was no doctor’s house found.
The standard requires the health center
to have 9 staff houses
The health centre has only two staff houses
Equipment Theatre equipment still covered in plastic bags.
Equipment has been idle for over two years.
b) Baitambugwe Health Centre III
Minimum standard HC 11I Current status
Running water No running water although a borehole has been
improvised
Basic accommodation for all core
Staff
Two staff are sharing a house out of 15
1.1.1 Non Delivery of Medical Supplies
It was observed that an amount of UGX.510,600,855 had been allocated to the District
for supply of medicines by the National Medical Stores. However, it was observed that
only UGX 391,469,967 worth of drugs where supplied. The balance of UGX 119,830,582
was not supplied. Management attributed this to lapses in National Medical Stores
delivery system.
93
The non-delivery of drugs and medical supplies greatly affects the capacity of health
facilities to offer health services to the Local community.
I advised the Accounting Officer to follow up with Ministry of Health and National
Medical Stores (NMS) to ensure that the NMS honours its obligation.
5.4.12 NAMUTUMBA DLG
1. Service Delivery
1.1 Education Sector
The Local Governments Management and Service Delivery (LGMSD) operational manual
section 2.1.2 (a) Program2.1.2 (a) requires Local Governments to deliver services in
conformity with Primary education minimum national standards of service delivery.
Analysis of a sample of 10 schools revealed that the required minimum education
standards have not be attained as shown below;
School Teacher
: pupil
Classroom
: pupil
Latrine stance:
pupil
Standard 1:55 1:55 1:40
Mpumiro P/s 1:72 1:92 1:129
Bulagazi P/s 1:59 1:263 1:120
Kategere P/s 1:62 1:201 1:160
Budatu P/s 1:85 1:104
Bunyinkiira P/s 1:207 1:83
Bukono P/s 1:62 1:108 1:132
Nabitula P/s 1:68 1:239 1:96
Nawaikona P/s 1:67 1:118 1:94
Nawampandu P/s 1:69 1:88 1:81
Namutumba Upper P/s 1:60 1:132 1:185
NAKISI P/s 1:56 1:125 1:100
The inadequate facilities negatively impacts on the academic performance of the
schools.
94
The Accounting Officer attributed the shortcomings to inadequate funding for the
UPE capitation grants to the schools.
I advised the Accounting Officer to engage stakeholders to ensure that the required
education standards in the primary schools are attained.
1.2 Health Sector
Section 2.1.2 of the LGMSD Operational Manual 2009 sets out Minimum National
Standards of Service Delivery (MNSSD), inspections of 8 Health Centers within the
District revealed the following deviations from the standards as set out in the
MNSSD;
a) Health Center II’s Kiranga HC II and Namuwondo HC III
Minimum Standards Current Status
At least 1 functional
and accessible pit
latrine
Kiranga had no pit latrine
OPD and Outreach
services
Namuwondo Health Center II did not have
medical beds
b) Health Center III’s
Minimum Standards Current Status
OPD with community shed
Namutumba, Magada and Ivukula HC
III
OPD but without a community shed
MNSSD stipulate 2 staff houses No staff house
Two General wards One general ward(Ivukula, Nawaisoke HC
IIIs)
Eight two stance pit latrine One – 2 stance lined pit latrines lacking in
Namutumba, Magada, Ivukula and
Nawaisoke HC IIIs.
c) Nsinze HC IV
Minimum Standards Current Status
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Minimum Standards Current Status
One Mortuary None
Two Doctors houses One exits
One Operating theater The theatre is not operational due to Lack of a
Doctor and Anaestretic officer.
Ten two stance pit latrine 6-2 stance lined pit latrines exist
Means of transport- one Non functional ambulance.
The Accounting Officer attributed the above shortcomings to inadequate resources.
I advised the Accounting Officer to engage Ministry of health and ensure that the
short comings are addressed.
5.4.13 NAMAYINGO DLG
1. Service Delivery
1.1 Water Sector
a) Poor Water Coverage and Non Functioning Water Sources
According to the District Development Plan and sector Objectives for the financial year
2014/15 the district was to increase water coverage to 77%.
A review of the performance reports water coverage in the district was 34% while 21%
of the water services were non-functional as detailed below;
Sub county Total Population
Boreholes Total Population served
Coverage %
Functional
Non
Functional
BANDA 55,100 62 16 78 13,302 24
BUHEMBA 32,600 53 28 81 9,346 29
BUSWALE 33,600 59 13 72 20,530 61
BUYINJA 25,800 49 8 57 12,366 48
MUTUMBA 48,800 25 10 35 14,463 30
NAMAYINGO T.C
14,900 30 10 40 9,245 62
SIGULU 42,000 61 5 66 8,018 19
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Sub county Total
Population Boreholes Total
Population
served
Coverage
%
Functiona
l
Non Functiona
l
TOTAL 252,800 339 90 (21%) 429 87,270 34
The low water coverage exposes the communities to unsafe water hence a risk of water
borne diseases.
The Accounting Officer attributed the shortcomings to low funding; but promised to
lobby for more funding.
I advised the Accounting Officer to engage the relevant stakeholders to secure the
funding to address the matter.
b) Lack of Water Quality Surveillance
Section 4.14 of the water and sanitation sector guidelines 2009/2010 requires Local
Governments to carry out measurement for water quality of newly constructed and
existing water sources.
However, out of the 429 old water sources, only 50 were tested for water quality
representing 11% and this was done by National Water and Sewerage Corporation.
Failure to test water consumed by the community, subjects them to the risk of taking
unsafe water which may lead to contracting of waterborne diseases.
The Accounting Officer attributed the lack of water testing equipment to financial
constraints.
I advised the Accounting Officer to engage the relevant authorities and acquire water
testing equipment.
1.2 Inspection Report
Paragraph 2.1.1 of the Local Government Service and Management Delivery (LGSMD)
operational Manual (Primary Education service delivery) requires a primary school to
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meet certain required minimum standards. However, a review the performance reports
in the education sector revealed that District standards were below the minimum
standards as shown below;
No Indicator Minimum standards/National
Actual for District
1 Teacher pupil ratio 1:55 1:67
2 Classroom pupil ratio 1:55 1:95
3 Desk pupil ratio 1:3 1:5
4 Permanent teacher accommodation
At least 4 teachers 1:32
5 Latrine stance pupil ratio
1:40 1:70
6 Building maintenance (not funded by LDG)
2%of capital expenditure budget of education
Not allocated
7 No of school inspections per term (not funded by LDG)
2 1
8 Performance over years Poor
Management admitted the shortcomings and attributed them to inadequate funding.
The Accounting Officer was advised to engage the Ministry of Education and Sports to
address the above shortcoming.
5.5 KAMPALA BRANCH
5.5.1 BUVUMA DLG
1. Unpaid Staff Salaries
Regulation 54(2) of the LGFAR, 2006 requires all employees to be paid monthly salaries
and employees’ salaries and pensions should be due and payable on the last day of each
month but arrangements may be made to effect earlier payment, particularly at times of
public holidays. However, the Payroll audit carried out in the month of August, 2015
revealed that 171 District staff and 14 Political Leaders had not been paid their monthly
salary and Gratuity respectively for the month of June 2015 to the tune of
UGX.120,318,311.
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This could have been a result of inefficiencies in payroll management. Delays in salary
payment may de-motivate staff and affect service delivery to the community.
The Accounting Officer explained that the Ministry of Finance, Planning and Economic
Development allocated insufficient funds to the district for salaries for the month of June
2015. Consequently, some members of staff were not paid. The Accounting Officer
further indicated that the matter was communicated to the Ministry for additional
funding. I advised the Accounting Officer to ensure that all salary arrears are paid.
5.5.2 GOMBA DLG
1. Un authorized Expenditure
Regulation 24(1) of the Local Governments Financial and Accounting Regulations, 2007
states that “expenditure for which there is insufficient or no provision in the approved
estimates shall not be incurred until a supplementary estimate has been approved.”
However, contrary to the regulation, it was observed that expenditure amounting to
UGX.67,315,000 was incurred on road works that were not provided in the annual work-
plan submitted and approved by Uganda Road fund for the year under review as shown
below;
DATE VOUCHER
NO
CHEQUE
NO
PAYEE DETAILS OF
PAYMENT
AMOUNT
07/08/2014 03-Aug 895 Mwoota African
Investment
supply of diesel for road
works for Kashengo-
Buyinja 13 m
11,520,000
08/08 898 Mutyaba Herbert
Kaggwa
allowance for
supervision of Buyanja
road
4,875,000
12/11/14 12/11 950 Mwoota African
Investment
fuel for grading of
Kisaka -Mamba road
11,000,000
19/12/14 10/12 970 Wamala Geofrey periodic maintenance of
Kasana-Mamba road
750,000
42019 42015 992 Mwoota African
Investments
fuel for opening of
Kisozi-Kiberero road
5,000,000
42033 42025 999/1001 Highways
Solutions ltd
hire of machine on
Kisozi-Kisoze- road
14,918,000
30/01/2015 24-Jan 1002 Wamala Geofrey release of amount on
Kisozi-Kibeere road
1,100,000
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11/02/2015 10-Feb 1010/11 Highways
Solutions ltd
hire of machine on
Kisozi-Kibere- road
18,188,000
TOTAL 67,351,000
This was irregular.
The Accounting Officer explained that these roads were handled as emergency cases
and that Council approved this activity under greater Kisozi Livelihood Road construction
region. However, the Council minutes approving these roads were not presented for
audit verification.
I advised the Accounting Officer to ensure that all expenditure is approved by Council.
5.5.3 LUWERO DLG
1. Loss of Cash
Regulation 95 of the Local Governments Financial and Accounting Regulations, 2007
requires all officers of the Council who hold public money, documents and books of
account, to ensure their safe custody and take adequate steps to ensure their
protection, handling, security and banking, as set out in the accounting manual.
Contrary to this requirement, the financial statements indicate that the district incurred a
financial loss of UGX.50,115,600. Out of this amount, the loss of UGX 19,962,950 has
been outstanding as far back as the year 2000/2001 while UGX 30,152,650 was lost in
the financial year under audit. Loss of cash may be due to poor supervision of
responsible officers and weak internal controls. Failure to recover losses over a long
period may lead to their write-off as bad debts.
In response, the Accounting Officer explained that efforts to recover carried over losses
totaling to UGX 19,962,950 were futile as no status report was received from police.
The Accounting Officer further indicated that the process of writing off this loss was
ongoing. The Accounting Officer further explained that the recent loss of
UGX30,152,650 was investigated internally, which led to interdiction of two officers and
the matter was submitted to police for further investigations.
The Accounting Officer was advised to follow up the matter with police to ensure
recovery.
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2. Salary Arrears
Regulation 54 (3) of the Local Governments Financial and Accounting Regulations, 2007
states that all Local Governments shall be up to-date with salary and pension payments.
However, review of the payroll verification reports by the Senior Personnel Officer (SPO)
revealed that the district had unpaid arrears for the months of May and June 2015
totalling to UGX 203,101,945. Delayed salaries payment de-motivates staff.
The Accounting Officer explained that the arrears arose from payroll errors which
occurred during the transition period deCentralising the payroll and migration from the
legacy system to IPPS.
I advised the Accounting Officer to ensure that the errors are rectified and the arrears
paid to the respective officers.
3. Review of the Youth Livelihood Programme (YLP)
During the financial year 2014/15, the district incurred UGX.467,200,590 to support
various youth groups under the Youth Livelihood Programme. Review of the group files
revealed the following;
3.1 Funds Not Recovered
Chapter 2.8 (g) of the Youth Livelihood Programme program document, 2013 requires
the enterprises to have a reasonable maturity period that permits re-payment of the
Interest-free Revolving Fund within a time period of one (1) year. However, it was noted
that the evaluation teams did not evaluate the maturity of the projects and consequently
96% of the funds equivalent to UGX.442,358,600 was not recovered by the end of the
financial year.
In response, the Accounting Officer explained that the Youth Livelihood project has a
maturity period of three years, and that funds would be recovered to enable access to
new groups.
I advised the Accounting Officer to ensure that the funds are recovered timely.
4. Inspections of Nalinya Lwantale Primary School
i) Old Structures
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Indicator 2 (d)(i)of the minimum standards indicators for Education institutions 2010
requires a school to have buildings that meet occupational safety standards set in
various laws. On inspection, the audit team noted that the school had a number of old
structures which is a threat to the lives of both the students and staff since these are in
a very sorry state such as the administration block shown below;
The Old Administration Block
ii) Lack of a Library
Indicator 2 (d)(vii)of the minimum standards indicators for Education institutions 2010
requires a school to have a library,or reading corner. On inspection, the audit team
noted that the school had a small room for a library which does not provide space for
students to sit and read from. This may lead to a decline in the students’ performance
due to absence of a conducive atmosphere for the students to read.
2.2.1.1 Pupil Absenteeism
The school has a total of 274 students however at the time of inspection, only 100
students were present.
Pupils engaged in unauthorised activities
Eighteen (18) P.2 pupils were found digging early morning which activity was not part of
the school curriculum. This wastes valuable study time and may affect completion of the
syllabus.
Class P1 P2 P3 P4 P5 P6 P7 TOTAL
NO. 22 18 10 7 10 17 16 100
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2.2.1.2 Lack of sick bay facilities
Indicator 2 (d)(xiii)of the minimum standards indicators for Education institutions 2010
requires a school to have a resting place for pupils. Audit observed that the school had
no sick bay facilities or a resting place. This may affect the students and teachers in
case of any emergencies where there is need for rest.
2.2.1.3 Lack of accommodation for Teachers
The school does not have accommodation for staff; hence they have to walk long
journeys to the school. This hampers their movement especially in the rainy season as
their basic means of transport is a bicycle. This may be the explanation for the poor
performance in the school.
The Accounting Officer explained that the School Facilities Grant was inadequate to
address all the above challenges.
I advised the Accounting Officer to communicate the issues to the relevant authorities
for possible funding.
5. Review of Luwero Rwenzori Development Project (LRDP)
5.1 Doubtful Supply of 126 Friesian In-Calf Heifers
Ms. Kesso Technical Services Ltd. was awarded a contract for Supply of 126 Friesian In
Calf Heifers under the Luwero Rwenzori Development Project (LRDP) at a contract price
of UGX.260,820,000 under Contract No.LUWE532/SUPLS/14-15/00014.
On 23rd January, 2015, the district paid the contractor UGX.237,387,600 for the supply
of 122 Heifers on voucher No.PYPLN-0670. However, a review of the expenditure and
procurement process revealed the following matters:
Some of the alleged beneficiaries lacked contacts like telephone contacts, parishes of
residence and second names. Consequently, tracing the persons to confirm receipt
of the animals worth UGX 18,630,000 was difficult.
The cows allegedly supplied did not have identification tags and as such they could
not be differentiated from any other cows.
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The Accounting Officer confirmed that 122 cows were procured and distributed; noting
that some of the beneficiaries did not have phone contacts but the beneficiaries could
be located through the Sub County Chiefs of the respective Localities.
I advised the Accounting Officer to ensure that the groups are adequately monitored so
that project objectives are achieved.
5.2 Supply of 46,666 Banana Tissues Culture Plantlets
46,666 banana tissues culture plantlets were supplied by M/s Agro-Genetic Technologies
Ltd. under the Luwero Rwenzori Development Project (LRDP) at UGX.139,998,000 under
Contract No.LUWE532/SUPLS/14-15/00013. On 27th April, 2015, the district paid the
contractor the full contract sum of UGX.139,998,000 on payment voucher No.PYPLN-
0677. A review of the supporting documents revealed that supplies were made to 7
Sub-counties as shown below:
Sub-county Quantity
Kalagala 11,660
Zirobwe 8,806
Nyimbwa 11,680
Butuntumula 11,820
Kikyusa 900
Makulubita 900
Bamunanika 900
46,666
However, a review of the inspection report of the Acting SAS Kikyusa (Mr. Misitu
Magambo) of 10th February, 2015 revealed that many of the plantations were dying.
Consequently the assessment of the beneficiaries’ capacity to manage the project was
rendered futile.
The Accounting Officer, explained that the banana regime was being affected by new
diseases, and that the absence of Sub-County Agriculture extension staff was affecting
provision of the needed services to farmers.
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I advised the Accounting Officer to liaise with relevant authorities to ensure that the
diseases and lack of agricultural extension staff are addressed.
5.5.4 WOBULENZI TC
1. Non Remittance of Revenue to Lower Local Governments
Part V (15A) of the Local Governments Act 1997 (as amended) requires a Town Council
to distribute 5% and 20% of the total shared revenue to Parishes and Village Councils
respectively. However, it was observed that the Town Council had not remitted shared
revenue amounting to UGX.57,381,236 to Parishes and Village Councils as shown in the
Table below:-
Un-Remitted shared Revenue to LLGs
Total Collections 276,151,872
Less Property tax 44,546,930
Less sale of Assets 2,080,000
Total sharable 229,524,942
25% for LLGs 57,381,236
Failure to remit shared revenue to the lower Councils denies service delivery at the
Lower Local Governments.
The Accounting Officer explained that although the Council had not followed the process
of deflections, the funds had been allocated to various activities in the entire respective
zones.
I advised Management to ensure that remittances due to lower Councils are made
promptly to provide services to the communities.
5.5.5 MPIGI DLG
1. Outstanding Employee Benefits
Regulation 54(3) of the LGFAR, 2007 states that all Local Governments shall be up-to-
date with salary and pension payments. However, a review of the financial statements
revealed that the district had pension arrears amounting to UGX.143,507,454, gratuity
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for political leaders amounting to UGX.2,358,720 and employee costs amounting to
UGX.170,820,839 by the close of the year under review, contrary to the regulation.
Further review of the district account No.005400068000001 revealed that
UGX.339,165,628 was deposited on the account on 26th of June 2015 to settle the
arrears. However, the Accounting Officer explained that before funds were transferred
to the beneficiaries’ accounts, the funds were withdrawn from the District account by
the Ministry of Finance, Planning and Economic Development.
I advised the Accounting Officer to follow up the matter with the relevant authorities
and ensure that the arrears are settled.
5.5.6 MUKONO DLG
1. Delayed Completion of Civil Works
During the year, the district received UGX 86,171,050 under the School Facilities
Grant(SFG). Documentary review of a sample of projects implemented and audit
inspection carried out in July 2015 revealed the following short comings;
Contractor Description Period Amount Paid UGX
Audit Observation
M/S Kosolo
Construction Co Ltd at
UGX.86,171,050.No.Muko542
/Wrks/13-
14/00002
Construction of
2 classroom
block, office,
store and supply
furniture at
Koome Buyana
R/C P/S in
Koome S/C
The
contract period was
from 24/12/2013
to
30/06/2014
UGX.57,208,555 Project was grossly behind
schedule by 13 month.
Un completed works
Fixtures
(UGX.14,747,000) Lightening protection
(UGX.1,301,000),
Windows and doors
(UGX.12,326,900) Floor and wall finishes
(UGX.10,335,500)
Facial and barge boards
(UGX.672,000)
Delayed completion of work denies the communities prompt services.
The Accounting Officer explained that the projects were far behind schedule and he
attributed it to the site being a hard to reach area.
The Accounting Officer further explained that the contractor had been instructed to
complete the works.
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I advised the Accounting Officer to follow up the matter to ensure that construction
works are completed.
5.5.7 MUKONO MC
1. Understatement of Receivables
Section 6.1.4 (2) of the Local Governments Financial and Accounting Manual, 2007
provides that, under accrual accounting, revenue is realized when a transaction occurs
and not when cash or its equivalents are received.A review of the municipality valuation
roll for property rates indicated that the chargeable amount from properties was
UGX.9,512,935,000 and the tax collectable was UGX.681,833,797. Audit however
observed that the receivables were disclosed at UGX 142,837,442, implying that the
receivables were understated by UGX.538,996,355. Furthermore, management did not
budget for collectable property tax.
The Accounting Officer indicated that there was difficulty in isolating residential
properties from commercial ones for purpose of charging tax.
I advised The Accounting Officer to update its property register to accurately reflect the
chargeable property tax.
2. Doubtful Expenditure on Utility Bills
Section 5.4.6 (1) of the Local Governments Financial and Accounting Manual, 2007,
requires that before any voucher is passed for payment, the Head of Finance shall
ensure that the voucher and any supporting documents or invoices are correct in all
relevant particulars.
Audit revealed that, during the year the Municipal Council paid UGX.48,753,148
purportedly to settle outstanding utility bills. However, the payments were not
supported by utility bills nor utility ledgers. I was therefore unable to confirm the basis
for this payment; hence the expenditure was rendered doubtful.
I advised the Accounting Officer to ensure that all expenditure is adequately supported
before it is passed for payment.
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5.5.8 NAKASEKE DLG
1. Un-authorised Excess Expenditure
Regulation 24 (3) of the Local Governments Financial and Accounting Regulations, 2007
requires the Chief Executive not to commit Council unless there is a provision in the
approved estimates by Council before expenditure is incurred.
I observed that UGX.1,011,278,633 was spent over and above the approved budget of
UGX.7,785,941,465 under Education department on salaries without authority of the
Council.
Management explained that there was a supplementary received from Central
Government to cater for shortages in salaries for teachers. However, there was no
formal communication from the Ministry of Finance Planning and Economic Development
about the supplementary to enable initiation of the process of approving the
supplementary budget by the Council.
I advised the Accounting Officer to always seek Council approval before effecting
expenditure.
5.5.9 NAKASONGOLA DLG
1. Outstanding Pension liability
Paragraph 4.2 (3) of the guidelines for processing Gratuities and Pensions under the
DeCentralised mode of May 2015, requires Accounting Officer to budget and account for
pensions and gratuities under their Votes.
However, it was observed that the district had outstanding pension liability of
UGX.158,361,947 payable to former employees of the district.
The Accounting Officer attributed the pension liability to budgetary constraints.
I advised the Accounting Officer to make retirement requests and create retirement
plans on IPPS for possible funding.
5.5.10 ENTEBBE MC
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1. Delay in Completion of a Maternity Ward at Katabi Health Centre III
A Local firm was awarded a contract for construction of a maternity ward at Katabi
HCIII under project reference Ente.752/Wrks/2013-2014/00014 at contract sum of UGX
185,328,120. The start date was 22nd April 2014 and expected completion date was 30th
June 2015. Audit inspection of the maternity ward in September, 2015 revealed that
works were behind schedule by three months as shown below;
Windows not fitted, No lightening
conductor
Internal fittings not yet completed with
toilet and bathroom yet to be installed
Septic tank still under construction
Delayed completion of works deny the community timely services.
The Accounting Officer attributed the delay in completion of the Maternity Ward to
inadequate release of Primary Health Care Development Funds.
I advised the Accounting Officer to ensure that the civil works are completed on
schedule.
5.6 MASAKA BRANCH
5.6.1 KALANGALA DLG
1. Lack of Vehicle Movement Logbooks
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Section 2.3.1.4(1) of the Local Governments Financial and Accounting Manual, 2007
states that asset log books especially for vehicles, tractors, among others should be
maintained to identify exactly what activities have been performed and at what date and
time.
It was however observed that there are no vehicle log books maintained. In the
absence of the vehicle movement register, controls over vehicle movement and fuel
consumption are weakened.
The Accounting Officer promised to establish the movement log books for all district
vehicles.
I await the Accounting Officer’s action.
5.6.2 KIBOGA DLG
1. Under Funding of UPE and USE Schools
Guidelines from the Ministry of Education require Chief Administration Officers of Local
Authorities to ensure that conditional grants to schools are received and not retained for
any other purposes. A review of head counts for the 21 UPE funded schools and 9 USE
schools revealed that the District schools were under funded by UGX.243,894,350 and
UGX.64,160,046 respectively.
This hinders the provision of quality services to the schools in the district.
The Accounting Officer explained that the District Education Officer and the Chief
Administrative Officer communicated to the Ministry of Education, Science, Technology
and Sports about this anomaly but there was no response.
I advised the Accounting Officer to continue liaising with the Ministry of Education,
Science, Technology and Sports to address the matter.
5.6.3 KIBOGA TC
1. Long Outstanding Debtors
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Regulation 32 of the Local Governments Financial and Accounting Regulations, 2007
requires that the Head of Finance is responsible for ensuring that revenue collectors,
defined under these regulations, carry out their duties properly to ensure that all
revenue due to the Council is promptly collected in the approved manner and banked
intact.
However, a review of the schedule of debtors indicated that Council had overdue
debtors of UGX 36,231,042 in respect of Graduated tax and Taxi Park fees arrears which
have been outstanding since 2006/07 from Kiboga District Administration and M/S
Honey pot Enterprises and Transport Company. Accumulation of overdue debts limits
availability of resources and negatively impacts on service delivery.
The Accounting Officer explained that at one time Council hired a lawyer and court
brokers but Ms. Honeypot Enterprises and Transport Co. had no physical assets to
attach while Kiboga District has continuously promised to pay.
I advised the Accounting Officer to pursue the collection of the debts and consider
recommendation for write-off where necessary.
5.6.4 LYANTONDE TC
1. Lack of an up-to-date valuation list
Section 4 of Local Government Rating Act provides that for the purposes of levying such
rate as it may determine on the basis of the rateable value of hereditaments within a
rating area, the Local authority shall cause to be made, for every rating area, within its
limits, the first valuation and thereafter a valuation list, once at least in every five years,
or such longer period as the Minister may approve.
However, Council did not have an up-to-date valuation list as a basis for levying rates
for Local revenues collected during the year 2014/15.
The Accounting Officer explained that Council had submitted to the Contracts Committee
their procurement requisition to secure a competent firm to revalue all properties.
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I advised the Accounting Officer to ensure that a valuation list is updated.
5.6.5 MASAKA DLG
1. Failure to transfer unconditional grants to Sub-Counties
Treasury released an amount of UGX 204,622,000 for the Sub-Counties.
However, a review of transfers to Sub-Counties revealed that out of the UGX
204,622,000, only UGX.146,010,663 was transferred to the Sub-counties leaving a
balance of UGX.58,611,337.
Failure to transfer the funds to Sub-Counties negatively impacts on service delivery.
The matter requires urgent attention.
5.6.6 MITYANA DLG
1. Outstanding Commitments
Regulation 11 (1) of the Local Government Financial & Accounting Regulations, 2007
provides that the head of finance shall ensure that commitments should not be
approved unless there is sufficient balance available in the relevant budget item.
However, it was observed that Council had outstanding obligations totalling to
UGX.94,949,931 as at 30th June 2015.
Delays to settle outstanding commitments may lead to litigation and costs.
The Accounting Officer explained that outstanding commitments arose out of insufficient
funding but they will progressively be cleared.
I advised the Accounting Officer to adhere to the commitment control system and
ensure that the outstanding debts are settled.
2. Lack of a fully constituted District Service Commission
Section 54(1 &2) of the Local Governments Act, 1995 requires that there shall be a
District Service Commission for each District which will consist of a chairperson and such
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other members as a District Council shall determine, at least one of whom shall
represent urban authorities and all of whom shall be appointed by the District Council on
the recommendation of the District executive committee with the approval of the Public
Service Commission.
However, it was observed that the Commission was not fully constituted since it
comprises of only 3 members out of the approved 5 with no chairperson during the
period under review.
The Accounting Officer explained that the District Council nominated 2 members whose
names were forwarded to the Ministry of Public Service for approval and response was
awaited.
I advised the Accounting Officer to follow up the submission and ensure that the vacant
positions on the Commission are filled.
5.6.7 MITYANA TC
1. Failure to issue receipts for revenues collected
Paragraph 4.5.2 of the Local Governments Financial and Accounting Manual 2007,
requires that for all revenues received by Council, acknowledgement receipts which are
serially numbered and printed in triplicates be issued.
However, management did not avail revenue receipts issued for Local revenues
amounting to UGX.29,352,663 as shown below;
Particulars Amounts
Total Local revenue collected as reported in the financial
statements 2014/2015
463,021,427
Amounts receipted as per availed receipts 433,668,764
Un receipted revenues 29,352,663
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This could lead to abuse of District Funds.
The matter requires urgent attention.
5.6.8 MUBENDE DLG
1. Unremitted PHC funds to Health Centres and NGO Hospitals
Article 193 (2) of the Constitution refers to a conditional grant as the minimum grant
that shall be paid to Local Governments to run deCentralized services. It was observed
that the district had not remitted to Health Centre II and some NGO hospitals
UGX.18,081,790 as shown in the table below;-
S/N Health centre / NGO Hospital
conditional
grant Expected
conditional
grant
received
conditional grant
outstanding
1 Mubende Town Council HC 11 2,063,523 1,500,000 563,523
2
Hope for the Needy Kitokolo
project (NGO) 8,800,000 0 8,800,000
3 Kyanamugera NGO 8,800,000 5,218,585 3,581,415
4 St Matia Mulumba 8,800,000 6,705,284 2,094,716
5 St Gabriel Mirembe Maria 12,000,000 8,957,864 3,042,136
40,463,523 22,381,733 18,081,790
Non remittance of conditional grants adversely affects service delivery.
The Accounting Officer explained that Council had written to the Permanent Secretary
Ministry of Health drawing his attention to the omission.
I advised the Accounting Officer to follow up the matter with Ministry of Health and
ensure that the funds are remitted.
a. Delays to complete doctors’ house at Kasambya Health Centre III
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The District awarded a contract to M/S Kamwebi Finance Investments Ltd to construct a
Doctors’ house at Kasambya Health Centre III at contract sum of UGX.75, 079,500. The
contract start date was 14th February 2013 and estimated end date was 30th May, 2013.
At the beginning of the Financial Year 2014/2015, UGX.69,219,325 had been paid, but
the project was still incomplete with an outstanding amount of UGX5,860,175.
Inspections carried out on 8th July, 2015 revealed that there were uncompleted works
totalling UGX.8,500,500 as shown below;-
Plumbing and drainage works had not yet been done for UGX.5,192,500,
Painting/touch ups not yet done for UGX 400,000.
Electrical fitting and installation not done for UGX.2,508,000
Unfinished works on the Kitchen for UGX.400,000
This implies that the contractor had been paid for works not done.
The Accounting Officer explained that the construction started as early as FY 2012/2013
and progress has been slow largely due to the weaknesses of M/S Kamwebi Financial
Investments Ltd, the contractor. The contract was formally terminated, in August 2015,
and the District issued an “intention to sue” notice to the company, for breach of
contract.
The matter requires urgent attention.
5.6.9 RAKAI DLG
1.1 Road Sector
1.1.1 Kagamba-Bbaale-Lwentulege road
Council carried out works on this road at a cost of UGX 58,621,200.
On inspection, it was observed that culverts purchased at UGX 7,896,000 were not
installed. This amounts to wasteful expenditure.
The Accounting Officer promised to have the anomalies rectified.
I advised the Accounting Officer to ensure that all the culverts are installed.
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1.1.2 Lwanda-Kiwenda Road
Council carried out works on this road at a cost of UGX 43,601,000.
It was observed that culverts valued at UGX 19,493,000 were dumped by the road side.
The Accounting Officer promised to follow up the matter and ensure that all culverts are
installed.
I advised the Accounting Officer to ensure that the work is completed.
5.6.10 RAKAI TC
1. Non Remittance of Shared Local Revenue
Part V of the Local Governments Act of 1997 as amended requires a Town Council to
remit 5% and 20% of the total Local revenue collected to parish and village Councils
that make up the Town Council respectively.
It was observed that an amount of UGX.12,384,260 had not been remitted contrary to
the law.
Non-remittance of shared Local revenue denies lower Councils the opportunity to
participate in promotion of Government programs.
The Accounting Officer explained that the administrative units’ services were imbedded
in the Council programmes hence each Local Council project was implemented by the
Council.
I advised the Accounting Officer to comply with the law.
5.6.11 SEMBABULE TC
1. Failure to remit shared Local revenue to lower Local Governments
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Part V of the Local Governments Act of 1997 as amended requires a Town Council to
remit 5% and 20% of the total Local revenue collected to parish and village Councils
that make up the Town Council respectively.
However, Council did not remit an amount of UGX.5,126,838 (25%) to the village
Councils contrary to the law. Non-remittance of shared Local revenue denies the lower
Councils to participate in planned Government programs.
The Accounting Officer explained that the money was not remitted to Lower Councils
due to financial constraints.
I advised the Accounting Officer to ensure that the shared Local revenue is remitted to
Lower Councils as prescribed by the regulations.
5.6.12 BUKOMANSIMBI TC
1. Non-compliance with statutory obligations
i. Failure to remit PAYE
Income Tax Act Cap 340 Section 19(1) requires employment income to attract Pay As
You Earn (PAYE) and remit it to Uganda Revenue Authority. However during the
financial year, management deducted but did not remit PAYE amounting to
UGX.2,942,400.
Failure to remit the PAYE deducted may result into fines and penalties by the tax body.
The Accounting Officer promised to remit the tax.
I await the action of the Accounting Officer’s promise.
ii. Failure to Charge Value Added Tax (VAT)
Section 4 (a) of the Value Added Tax (VAT) Act cap 349 requires imposition of VAT
on eligible supplies. To the contrary management did not charge VAT amounting to
UGX.11,302,974.
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Failure to charge and remit VAT attracts fines and penalties.
The Accounting Officer explained that a payment plan has been drafted to ensure
that the tax is remitted.
I urged the Accounting Officer to comply with the tax law.
5.6.13 KALUNGU DLG
1. Over Expenditure on Software Activities
Paragraph 4.2(b) of the Water and Sanitation Sector guidelines of May 2012 requires
that Software activities for rural water supply and sanitation shall be allocated up to 8%
of District Water and Sanitation Conditional Grant (DWSG). Management received funds
for DWSG worth UGX 328,985,492 therefore software activities should have been UGX
26,318,839. However, actual expenditure on software activities was UGX.47,363,500
leading to an over expenditure of UGX.21,044,661 representing 63% of the total grant
received.
Over expenditure on software activities limited the availability of funds for other
planned activities. For example, management planned to construct 10 hand augured
wells but only 5 were constructed.
The Accounting Officer explained that this was due to wrong charging of items in
software activities.
I advised the Accounting Officer to ensure that expenditure on software activities is in
accordance with the sector guidelines.
5.6.14 LWENGO DLG
1. Utilization of the Capacity Building Grant (BG)
Section 8 of LGMSDP operational guidelines requires that not less than 25% of the total
capacity building grant in the year should be used in Lower Local Government (LLGs).
However, a review of CBG expenditure revealed that the district spent UGX.26,689,820
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while UGX.5,203,980 was spent at Lower Local Government which is 16% of the total
expenditure of UGX.32,128,106.
This affected implementation of capacity building activities in the LLGs.
The Accounting Officer explained that most of these funds were utilized for the training
of staff in the lower Local Government.
I advised the Accounting Officer to ensure that the grant is utilized in accordance with
the guidelines.
2. Payment of salaries to non-validated staff
A review of the payroll records revealed that 49 members of staff missed the payroll
validation exercise that took place in August 2014. The personnel officer explained that
the District contacted Ernest and Young who conducted the exercise on behalf of
Auditor General to fix a date for the staff to be validated but this had not yielded results
at the time of the audit.
However, the District continued to pay the staff monthly salaries amounting to
UGX.243,928,090. This exposes the district to a risk of paying staff that are not
legitimate.
The Accounting Officer promised that the staff will be validated when the validation
exercise resumes.
The matter requires urgent attention.
5.6.15 LWENGO TC
1. Under Utilization of LGMSDP Funds
The Town Council budgeted for and received UGX.6,671,977 under the Local
Government Management Service Delivery Programme (LGMSD). However, it was
observed that Council did not implement all the planned activities for which the funds
were provided resulting into an unspent balance of UGX.6,300,000 (94%) being
transferred back to Treasury.
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The Accounting Officer explained that the non-utilization was due to delayed
procurement process by the contracts committee.
I advised the Accounting Officer to ensure that in future, Council activities are
implemented on schedule and according to work plans to avoid repaying back funds to
Treasury.
5.6.16 MATEETE TC
1. Non-compliance with statutory obligations
Income Tax Act Cap 340 requires that all allowances gained by a resident individual on
part time employment be subjected to a tax at 30%. However, during the financial year
under review, the Town Council paid UGX.7,970,000 to Councillors and Standing
Committees in allowances without deducting PAYE of 30% equivalent to UGX.2,391,000
as required by the law.
This exposes the Council to fines and penalties from the tax body.
The Accounting Officer explained that management was not aware that the deductions
should have been made from those allowances.
I advised the Accounting Officer to recover these taxes and promptly remit them to
URA.
2. Failure to remit shared Local revenue to Lower Local Governments
Part V of the Local Governments Act of 1997 as amended requires a Town Council to
remit 5% and 20% of the total Local revenue collected to parish and village Councils
that make up the Town Council respectively.
It was observed that an amount of UGX.4,291,897 had not been remitted contrary to
the law. Non–remittance of shared Local revenue affects implementation of planned
activities which highly inhibits service delivery at the Lower Local Councils.
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The Accounting Officer explained that due to the fact that the Town Council earns very
little revenue yet it has to offer service delivery in these parishes, it had been resolved in
the meeting of all Chairpersons of LCI and LCII that the Town Council retains these
funds to improve on service delivery.
I advised the Accounting Officer to ensure that the shared Local revenue is remitted as
required by law.
3. Irregular repair of tractor
Section 3.14 (1), (2) and (3) of the Local Governments Financial and Accounting Manual,
2007 provides procedures to be followed for approval of a re-allocation.
The procedures require the vote controllers to initiate the process addressed to the Chief
Executive who will in turn submit to the Executive Committee for approval.
If approved, the Chief Executive will communicate accordingly with copies to Head of
Finance, Internal Audit and Auditor General.
On the contrary, UGX.5,412,311 was budgeted to be used to construct a slaughter slab
but the executive approved that the amounts be used to buy land where a public toilet
would be constructed. However, the funds were instead used to repair the tractor
without prior approval of the executive.
In addition, the procurements were not forwarded back to the District Contracts
Committee for approval and there were no re-allocation warrants prepared.
The Accounting Officer explained that the available funds were allocated to the repair of
the tractor to avoid commotion which would result from non-collection of garbage and
that the Council would look for funds to purchase land for the construction of the public
toilet.
I advised the Accounting Officer to comply with the regulations regarding re-allocations.
121
4. Use of direct procurement for the hire and repair of equipment under Force
Account
Section 2.1 of the Circular No.3 of 2012 To Local Governments on Use of Force Account
Mechanism issued by Public Procurement and Disposal of Public Assets Authority on the
21st September, 2012 requires the Procuring and Disposing Entity to procure required
supplies using the procurement rules and methods in the PPDA Act, 2003 and the Local
Government (PPDA) Regulations, 2006 and the Guidelines issued by the Authority.
It was however observed that the district had prequalified firms for hire and repair of
road construction equipment, the Town Council instead advanced an amount of
UGX.14,007,000 to the Engineer to acquire equipment.
The Accounting Officer explained that they had to use direct procurement under the
force on account system to acquire the said spare parts/ services for the Town Council
to have a bargaining power as the said pre-qualified supplier were quoting higher prices
for the same products.
I urged the Accounting Officer to follow the force on account guidelines for the hire and
repair of road construction equipment.
5.7 MBALE BRANCH
5.7.1 BUDAKA DLG
1. SERVICE DELIVERY
1.1 Non-Functioning Health Centre – Mugiti HC III
Paragraph 2.1.1 (d) of the Local Government Management and Service Delivery
(LGMSD) Programme operational manual for Local Government sets minimum standards
for proper functioning of health centres.
It was observed that the district constructed and completed Mugiti HC III at a cost of
UGX.292,468,766 as detailed below:-
Project Name Amount (UGX)
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Construction of maternity ward at Mugiti HCIII (2013/14) 139,101,980
Construction of OPD at Mugiti HC III (2013/14) 65,000,000
Construction of 4 stance pit latrine at Mugiti HCIII (2014/15) 11,799,196
Construction of 4 stance pit latrine at Mugiti HCIII (2013/14) 9,900,923
Total 292,468,766
However, audit inspection revealed that the health centre is not functional.
Failure to operationalize the health center has continued to deny the community the
badly needed services.
The shortcoming was attributed to lack of staff and drugs.
The Accounting Officer explained that Skeleton staff had been deployed at the Centre
and the Ministry of Health had indicated that allocation of drugs and funds was to begin
in the financial year 2015/2016.
I advised the Accounting Officer to continue liaising with the stakeholders to have the
health center functional.
5.7.2 BUDAKA TC
1. PROCUREMENT
Contract payments not properly supported
Regulation 5.4.5(2) and (3) of the Local Government Financial and Accounting Manual
2007 requires payments for goods/ services to be supported by records including;
Duplicate copy of requisition for goods from the user department; Duplicate copy of the
Local Purchase Order (LPO); Delivery Note from supplier; Goods Received Note (GRN)
from stores; Supplier’s Invoice; and Contracts Committee Authority; Copy of
Contract/Agreement for the service; and certificate of performance, or Inspection Report
approved by a Technical Expert recognized by the Council.
However, contrary to the regulation, Council made payments amounting to UGX
97,355,300 to various Suppliers/ Contracts which lacked supporting documents.
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I advised the Accounting Officer to avail the documents for audit verification.
5.7.3 BUDUDA DLG
1. Service Delivery
1.1 Health Sector
Paragraph 2.1.1 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
for proper functioning of health centers. However, on inspection of Bududa hospital and
some health centers revealed a number of shortcomings as outlined below;
a)Bududa Hospital
The Audit Inspection of the hospital revealed the following:-
S/No. Shortcoming Identified Management Response
01. Under staffed with 89 staff out of the
approved structure of 190, there is no staff
in pharmacy and anesthesia. The hospital
administrator is the Acting District
Personnel Officer at the same time without
an assistant. The Hospital recruitment was
last done in 2006.
The issue is noted but more staff was
being transferred from the Health
Centre 111s to beef up the hospital
operations.
02. Only one vehicle is available - an ambulance
that does all the hospital operations.
This issue was forwarded to the
Ministry of Health for action.
Poor facilitation of the hospital could result in poor service delivery.
I advised the Accounting Officer to engage the Ministries of Health and Finance and
Economic Development to assist in ensuring that the hospital is better facilitated for
effective service delivery.
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5.7.4 BUDUDA TC
1. Lack of a Physical Development Plan
Section 11 &12 of the Physical Planning Act, 2010 provides that each urban authority or
city shall establish an urban physical planning committee which shall cause to be
prepared urban and Local Physical Development Plans and detailed plans. However, it
was observed that the Town Council neither had a Town Planning Committee nor
Physical Development Plan.
Lack of Physical Planning Committee undermines orderly and organized Town
development.
The Accounting Officer attributed the Shortcoming to lack of technical staff including; a
Physical Planner, Land Surveyor, Architect and Cartographer.
I advised the Accounting Officer to ensure that a Physical Planning Committee is
constituted and a physical development plan developed.
5.7.5 BUKWO TC
1. Lack of Urban Physical Plan
Section 11 and 12 of the Physical Planning Act, 2010 provides that each Urban Authority
or City shall establish an Urban Physical Planning Committee which shall cause to be
prepared urban and Local physical development plans; to recommend development
applications to the board for change of use of land and to determine the development
application relating to location, dumping sites or sewerage treatment which may have
injurious impact on environment among other responsibilities. However, it did not have
an approved physical development plan at the time of audit. It was also noted that the
Town Council lacks a planner to offer the required technical advice.
The absence of an approved plan undermines orderly and organized Town development.
The Accounting Officer explained that failure to recruit a physical planner was due to
insufficient wage bill.
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I advised the Accounting Officer to prioritise the recruitment of a physical planner to
develop the urban physical plan.
5.7.6 BUSIA DLG
1. Procurement
1.1 Unsupported Evaluation reports
Section 27 (8) of the Local Governments (Public Procurement and Disposal of Assets)
Regulations 2006 provides that the evaluation committee shall undertake the
assessment of tenders Submitted, rank them and submit an evaluation report and
assessment scores to the procurement and disposal unit for submission to the contracts
committee. However, Audit of Twenty one (21) procurement files worth 1.6bn revealed
that whereas evaluation reports had been prepared, there were no individual score
sheets to support the results as required by the regulations.
Consequently, I was not able to confirm that evaluation of contracts was undertaken in
a transparent manner.
I advised the Accounting Officer to enforce procurement regulations to enhance
transparency in procurement evaluation.
2. Service Delivery
2.1 Health Services
Section 2.1.1 D of the Local Government Management and Service Delivery (LGMSD)
Program Operational Manual provides for minimum standards of health service delivery.
However, inspection of health centers revealed a number of matters that are outlined
below;
b) Status of Masafu Hospital
Masafu General Hospital is the only district hospital serving Busia, Namayingo and parts
of Kenya as a District Referral Hospital. According to management, this Hospital has
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generally improved provision of curative, preventive and promoted health services.
However, inspection of the hospital revealed a number of challenges as outlined below;
Issue Observation
Staffing Gap
The hospital currently has only 86 out of the required 185 staff
establishment. This in turn has outstretched the current staffs that
have to pick up extra hours and shifts. Quality of health services is
also undermined in such circumstances.
Administrative Officer communicated the challenges and requested
for the ministry’s intervention to help avert the staffing gap.
Transport
Challenges
The hospital has an old ambulance Reg. UG 3699M as the only
vehicle which serves patients on referral, routine movements and as
an administrative vehicle for consultative purposes. The cost of
maintenance has become too high since the vehicle is too old and is
overstretched.
Shortage of
Infrastructure
The hospital lacks an Administrative block, an appropriate store for
safe keeping of medicines and other items, a laundry room, modern
mortuary, kitchen, Askari house, staff quarters fence, computers for
records office, shelves for patient files and borehole to combat water
shortages. Disposal of medical waste is also a challenge as the
hospital does not have an incinerator.
Shortage of Drug There is an acute shortage of drugs. It was noted that at the time of
inspection, the credit line was exhausted due to discrepancies in the
planned allocation and actual release.
The Accounting Officer explained that she had communicated the challenges to the
responsible Ministry of Health and also requested the Ministry’s intervention on the issue
of staff shortage.
I advised the Accounting Officer to continue following up the matter with the Ministry of
Health and the challenges addressed.
c) Non Functioning Health Centers in the District
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Three health Centre IIs in Butangasi, Buyengo and Kubo Sub counties constructed in
2012/2013 to a tune of UGX. 193,012,422 were to-date not functional. These health
centers have all the necessary facilities including OPDs and latrines and a 2 in 1 staff
house. It was also noted that the centers have one staff (enrolled nurse) each, posted
there in January 2014 using SDS funds. These 3 nurses are in the meantime helping out
at Masafu hospital waiting for the centers to be operationalized. Further noted was that
the ministry was yet to provide fund allocation to the new centers.
The Accounting Officer attributed the delay in operationalizing these centers to failure by
Ministry of Health to Code the centers to enable them receive drugs from NMS. Evidence
to confirm this was however not readily provided.
The continued existence of facilities that are not being used denies the intended users
timely and easy accessibility to health services.
5.7.7 BUSIA MC
1. Service Delivery
1.1 Delayed Completion of a Project
Regulation 43 (2, 3 and 5) of the LG PPDA Regulations, 2006 requires that all
procurements and disposals shall be conducted in a manner that promotes
transparency, accountability and fairness, maximisation of competition, promotes
economy, efficiency and value for money. However, during the financial year
2013/2014, a contract of UGX 1,807,699,504 was awarded to M/s Engineering Trade
Links ltd for construction of the main office block at Busia Municipal Council. By the time
of audit in September 2015, UGX.429, 864,902 had been paid to the Contractor.
However, audit inspection revealed that the Contractor had abandoned the site.
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The Accounting Officer explained that he had sought no objection from the Office of
Solicitor General to have the contract terminated and was awaiting the response.
I advised the Accounting Officer to follow up on the process of terminating the contract
should be expedited to allow for the contract and ensure that the project is completed.
5.7.8 BUTALEJA DLG
1. Unsupported Payment of Salary Arrears
Section 26 of the General rules on Payment of Salaries (B - a) in standing orders
provides that Salary arrears that accrue to a Public officer within a financial year shall be
paid through the payroll within the same financial year.
However audit revealed that on 13th January, 2015, the Accounting Officer submitted a
request for payment of salary arrears amounting to UGX.563,921,414 out of which UGX
219,432,034 was paid leaving a balance of of UGX 344,489,380 outstanding. The
arrears relate to financial years (1999-2014). However, the payment schedule did not
specify the details of the period paid and pay change reports to support the arrears.
There is a risk that some of the payments could have been made to ineligible persons.
The matter require urgent attention.
5.7.9 KWEEN DLG
129
1. Unsupported Settlement of Domestic Arrears
Section 5.4.6(1) of the Local Governments Financial and Accounting Manual, 2007
requires the Head of Finance to ensure that payment vouchers and any supporting
documents are correct before being passed for payment. However, note 14 to the Cash
flow statement shows that the district paid a total of UGX.172, 896,375 as domestic
arrears. However, the supporting documents were not presented for audit verification
rendering expenditure doubtful.
The Accounting Officer explained that the arrears related to salaries but no documentary
evidence was availed for audit verification.
I advised the Accounting Officer to avail the supporting documents for audit verification.
2. Duplicate payments
Section (B-a) (7) of the Public Service Standing Orders,2010 requires salaries to be paid
correctly in accordance with the approved salary structure for the Public Service.
However, Payroll analysis revealed duplicate payments totalling to UGX 22,314,308.
The Accounting Officer explained that the seemingly duplicate payments were genuine
payments relating to salary arrears for previously unpaid months, unapplied EFTs and
duty allowance. Verification however revealed that out of the total duplicate payments,
UGX.12, 668,999 remained unexplained.
I advised the Accounting Officer to justify the payments.
5.7.10 MANAFWA DLG
1. Duplicate Payments of Salaries
Section (B-a) (7) of the Public Service Standing Orders,2010 requires salaries to be paid
correctly in accordance with the approved salary structure for the Public Service.
However, Payroll analysis revealed Thirty (30) transactions appearing as duplicate salary
payments. These transactions amounted to UGX 21, 994,058.
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The Accounting Officer explained that the seemingly duplicate payments were caused by
a number of factors including; repayments made to make good the bounced payments,
summation of previous unpaid months of July, august and September 2014 and June
2015. However, I was not able to verify the claims in the response as both BOU
statement and salary invoice register could not be readily provided at the time of
verification.
2. Delayed Completion of Civil works at Bukimanya Health centre 111
The district contracted Local Contractor to construct Bukimanya HC iii at a contract price
of UGX.179, 262,236 in 2010/2011 financial year. By time of inspection in September
2015 a sum of UGX.170, 299,000 had been paid leaving only UGX.8, 963,236.
However, inspection revealed that the building had stalled, appeared to have been
abandoned and had developed cracks as shown below:-
The matter requires urgent attention.
5.7.11 MBALE DLG
1. Outstanding revenue arrears
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Sec. 98(1) & (2) of the Local Governments Financial and Accounting Regulation
(LGFAR), 2007 requires the Head of Finance and heads of revenue collecting
departments to ensure that prompt reminders are sent when revenue becomes overdue
and If a reminder fails to produce payment within thirty days of its dispatch, legal
proceedings be instituted. However, review of the statement of arrears of revenue
revealed that the district had outstanding revenue amounting to UGX 1,026,358,254.
Revenue arrears deny the Council the opportunity of using the money to provide
services promptly.
The Accounting Officer explained that management has been undertaking numerous
measures to including legal action.
2. Service Delivery Issues
2.1Inspection of Nakaloke Health Centre III
a) Lack of Essential facilities and equipment
Paragraph 2.1.1 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
for proper functioning of health centers. However, inspection of the Nakaloke Health
Centre III revealed that essential equipment were lacking as shown in the table below;
Essential equipment Oxygen equipment; Protective gears such as gumboots &
aprons for labor suit officers; Bulb sucker for babies and
Resuscitation equipment kit for the new born babies
were missing.
Water supply The labor suite and post-natal ward did not have running
water and light.
Delivery beds The Health center had only one delivery bed which was
rusty. We established that on average 10 mothers gives
birth daily implying the one bed is inadequate.
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Lack of such essential equipment and other facilities negatively affects health service
delivery to the communities.
The Accounting Officer explained that Ministry of Health had planned to procure medical
equipment and maternity and other equipment for the districts.
I advised the Accounting Officer to continue following up the matter to ensure that such
essential equipment and facilities are availed to the Health Centre.
5.7.12 SIRONKO DLG
1. Audit Inspection Budadiri Health Centre IV
a) Lack of Minimum Basic Requirments
Paragraph 2.1.1 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
for proper functioning of health centers. However, inspection of Budadari Health Centre
IV carried out on 26/08/2015 revealed that the health Centre lacks an ambulance and a
drug store.
Operating a medical center without an ambulance exposes the lives of patients who may
not be transfered to a refferal hospital in time. Also, poor storage of drugs may result in
faster expiry and or loss through theft.
The Accounting Officer explained that several formal requests had been made to the
Permanent Secretary, Ministry of Health with no response.On the issue of stores, he
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indicated that funds had been allocated for remodeling an alternative room that shall be
used as a store.
I advised the Accounting Officer and the District Health Officer to continue appealing to
Ministry of Health and Finance to ensure that the health center is properly facilitated to
provide better services to the people.
2. Long Outstanding Salary Arrears
The Uganda Public Service Standing Orders Section B-a (25) provides that Salary arrears
that accrue to a Public officer within a financial year shall be paid through the payroll
within the same financial year. Further, Section (26) provides that responsible officers
shall process all residual salary arrears by 30th September. On the contrary, it was
noted that the district accumulated salary arrears for employees amounting to UGX
315,193,294. The arrears for some employees date as far back as 2008 which indicates
a weakness in follow up.
Failure to pay employee’s salaries in time demotivates them and negatively impacts on
service delivery.
The Accounting Officer attributed these arrears to the staff who were erroneously
deleted from the payroll during the general cleaning of the payroll by the Ministry of
Public Service. He indicated that pay change reports had been prepared and arrears
approved by the Ministry of Public Service.
I advised the Accounting Officer to follow up the matter to ensure that the affected
staff are paid withiout further delay.
5.7.13 BUDADIRI TC
1. Lack of Physical Planning
Section 11 &12 of the Physical Planning Act, 2010 provides that each urban authority or
city shall establish an urban physical planning committee which shall cause to be
prepared urban and Local physical development plans and detailed plans; to recommend
development applications to the board for change of use of land and to determine the
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development application relating to location, dumping sites or sewerage treatment
which may have injurious impact on the environment among other responsibilities.
However, it was observed that the Town Council neither had a Town planning
committee nor an approved development plan. It was further noted that the Town
Council lacked a planner.
Lack of a physical planning undermines orderly and organized Town development.
The Accounting Officer explained that the physical planning committee was not fully
constituted due to lack of critical personnel; He however indicated that interviews had
been conducted for the physical planner.
The Town Clerk was advised to ensure that a Town planning committee is constituted to
facilitate the process of obtaining an approved physical plan and to implement it.
5.7.14 TORORO DLG
1. Retired staff still accessing payroll
Paragraph 5.6.3(2) Local Governments Financial and Accounting Regulation (LGFAR),
2007 requires that the Personnel Officer should ensure that staffs that have left the
service of the Local Government are removed immediately from the payroll. However,
records indicated that a number of persons supposed to have retired during the year
remained on the payroll for several months receiving salaries amounting to
UGX.75,179,202.
The Accounting Officer attributed the anomaly to failure by Integrated Personnel Payroll
System (IPPS) to detect staff due for retirement.
I advised the Accounting Officer to ensure recovery of the funds from pension benefits.
2. Failure to maintain contract management records
Regulation 119(10) (a) (vii) of LGPPDA 2006 provides for proper contract management
records, to be maintained. However, it was observed that in a sample of 14 contracts
valued at UGX.1, 457,758,987 the contract management records were not properly
135
maintained. The documents including; implementation plans, site minutes, work records
and related contract work progress reports for contracts undertaken were not presented
for audit verification.
This was attributed by management’s failure to appoint contract managers.
The Accounting Officer admitted the shortcoming and promised to address the matter.
I urged the accounting Officer to ensure that contract managers are appointed and to
ensure that contract management records are properly maintained.
3. Failure to collect property rates/taxes
Section 11(g) of Local Government Financial and Accounting Regulation 2007 requires
the head of finance to supervise and ensure the prompt collection of all revenue due to
the Council and bring it to account. However, the district set out to collect property tax
and demand notices were issued for UGX.670, 626,897, for the FY 2014/2015, but
realized only UGX.270, 209,017 leaving a balance of UGX.400,417,880 by the end of the
year.
Uncollected taxes undermine service delivery.
The Accounting Officer explained that Council was considering taking legal action on
defaulters.
I advised the Accounting Officer to use all the available means to enforce the recovery
of the outstanding balances from defaulters.
5.7.15 TORORO MC
1. Diversion of capacity building funds
I carried out inspection of the Municipal Council and it was observed that capacity
building expenditure worth UGX.1,180,000 was executed outside the Council’s work
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plan. Diversion of funds from the planned activities translates into misallocation of
resources.
Project management responded that the Municipal Council was advised to refund the
funds spent outside USMID activities.
The promised action is awaited.
5.7.16 LWAKHAKHA TC
1. Lack of Urban Plan
Section 11 &12 of the Physical Planning Act, 2010 provides that each urban authority or
city shall establish an urban physical planning committee which shall cause the
preparation of the urban and Local physical development plans and detailed plans, to
recommend development applications to the board for change of use of land and to
determine the development application relating to location, dumping sites or sewerage
treatment which may have injurious impact on the environment among other
responsibilities. However, it was observed that the Town Council lacked an approved
urban development plan. It was further observed that the Town Council had no physical
planning budget and lacked a planner.
The absence of the urban development plan undermines orderly and organized Town
development.
The Accounting Officer explained that the Town planning committee had made a
proposal to the Ministry of Local Government to support the Town Council with
resources for a detailed physical plan.
I advised the Accounting Officer to expedite the process of developing the physical
development plans to guide orderly and organized Town development.
5.7.17 BULAMBULI DLG
1. Service Delivery
137
1.1 Mayembe Health Centre IV
The inspection of the Health Centre revealed the following shortcoming:-
a) Expired TB drugs
Section 1.8 of the World Health Guidelines for the Safe Disposal of Unwanted
Pharmaceuticals in and after Emergencies Interagency 1999 outlines the consequences
of improper disposal or non-disposal of expired pharmaceuticals. However, inspection of
Muyembe Health Centre IV revealed that the Health Centre had expired TB drugs
estimate at 500 kilograms. The expired drugs may be diverted for resale to the general
public. The drugs were also not properly stored as can be shown by the photograph
below.
The Accounting Officer explained that a Non-Governmental Organization (NGO) called
GREEN LABLE had been contracted by ministry of health and USAID to collect and
destroy expired items but the operations stopped in 2014. He explained further that
NMS had been informed and the district had budgeted for an incinerator.
I advised the Accounting Officer to liaise with Ministry of Health and National Medical
Stores (NMS) and have the expired drugs disposed of.
b) Lack of Resuscitation equipment kit in the Maternity Ward
138
Paragraph 2.1.1 (D) of the Local Governments Management and Service Delivery
(LGMSD) Program Operational Manual for Local Governments sets minimum standards
for proper functioning of health centres.
Statistics provided by the health Centre management revealed that four (4) out of the
79 new born babies on average die per month as a result of lack of the kit.
However, inspection of Muyembe Health Centre IV revealed that the health center
lacked a resuscitation equipment kit. According to the medical personnel, the kit is very
critical for the lives of new born babies in case of asphyxia and supplying oxygen to
infants. There is a risk of a loss of life for many babies as a result of the absence of this
machine.
The Accounting Officer attributed the absence of the machine to inadequate funding.
However the district is negotiating with the line Ministry to acquire the kit.
The matter requires urgent attention.
5.7.18 BULAMBULI TC
1. Non- Remittance of shared Local revenue
According to the Local Government Act 1997 (as amended), fifth schedule, Part V (15A),
a Town Council is required to remit 5% of the total Local revenue collected to parishes
and 20% to village Councils. However, it was observed that the Town Council did not
remit UGX.12, 861,485 contrary to the law. Failure to remit funds to Lower Local
Councils negatively impacts on service delivery at Lower Local Governments.
The Accounting Officer explained that the remittances to parishes and villages were
channelled through co-funding under the LGMSD projects that were beneficial to the
same communities. He however failed to provide evidence of how each 4 parishes and
23 villages had benefited.
I advised the Accounting Officer to ensure that the share of Local revenue is remitted to
the Lower Local Councils as required by the law.
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5.7.19 BULEGENI TC
1. Lack of physical planning
Section 11 &12 of the Physical Planning Act, 2010 provides that each urban authority or
city shall establish an urban physical planning committee which shall cause to be
prepared urban and Local physical development plans and detailed plans; to recommend
development applications to the board for change of use of land and to determine the
development application relating to location, dumping sites or sewerage treatment
which may have injurious impact on the environment among other responsibilities.
However, it was observed that the Town Council lacked a planner.
Absence of a physical planning undermines orderly and organised Town development.
The Accounting Officer explained that management was in the process of lobbing for
funds to facilitate physical planning activities. He indicated that a submission for
recruitment of a physical planner had been made to the District Service Commission.
I advised the Accounting Officer to ensure that physical planning is undertaken and a
planner recruited.
5.8 MBARARA BRANCH
5.8.1 BUSHENYI DLG
1. Unpaid Salary Arrears
Section (B-a) part 11 of the Public Service Standing Orders General rules on payment of
salaries requires the Accounting Officer to ensure that public officers access the payroll
within four (4) weeks from assumption of duty. However, some employees did not
access the payroll within the four weeks which led to accumulation of salary arrears
amounting to UGX.107,570,405.
The Accounting Officer explained the district is following up the matter with Ministry of
Finance, Planning and Economic Development for payment.
I advised the Accounting Officer to ensure that the arrears are paid.
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5.8.2 KABALE DLG
1. Staff Salary Arrears
Section 25(B-a) of the Public Service Standing Orders 2010 states that salary arrears
that accrue to a Public officer within a financial year shall be paid through the payroll
within the same financial year. However, salaries worth UGX.626,759,249 for Primary,
Secondary & Tertiary Teachers, Health & District staff were outstanding as at 30th June
2015.
Late payment of staff salaries demotivates staff and negatively affects service delivery.
The Accounting Officer explained that the process of clearing all outstanding salary
arrears was on-going.
I advised the Accounting Officer to engage the relevant authorities and ensure that
salary arrears are settled.
2. Lack of financial Statements for Health Centres
Regulation 62(4 & 5) of the Local Governments Financial and Accounting Regulations,
2007 states that the officer in charge of a health unit shall submit monthly financial
statements to the sub-county and where the health unit is unable to prepare the
financial statements, assistance shall be sought from the sub-accountant of the sub
county and copies of the financial statements to be copied to the District Chief
Executive. Contrary to the above, the Health units were not submitting their monthly
financial statements to the sub county and the chief executive at the district. Failure to
present financial statements impairs review and analysis of their performance.
The Accounting Officer explained that there was lack of skills for preparation of financial
statements but the district was taking steps to address this.
I advised the Accounting Officer to liaise with the responsible authorities to ensure that
the necessary guidance on financial statements is sought and staff capacity enhanced.
3. Service delivery
i. Education
a) Performance of UPE Schools
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Analysis of performance in 134 schools across the district for the period 2008 to 2014
indicated that a total of 28,705 pupils who sat Primary seven between 2008 to 2014,
only 3% (1,001 pupils) passed in grade one, 7% (1,961 pupils) failed, 10% (2,906
pupils) were disqualified. This reflects unsatisfactory performance in the district.
The Accounting Officer explained that the laxity of parents and teachers, pupils’
absenteeism and pupils’ low competitive spirit were the main causes of the poor
performance and promised to continue with the mobilization of parents and other
stakeholders in a bid to improve on the poor performance.
I advised the Accounting Officer to engage the relevant stakeholders to address the
matter.
b) High Drop Out Rate
A review of pupil enrolment trends in 292 UPE schools in the district (P7 examination
centres) from the year 2008 when the students were in primary one (34,597 pupils) to
when they sat primary seven in 2014 (10,446 pupils) (100%coverage) revealed high
dropout rate of 70% as shown in the table below:
Year 2008 2009 2010 2011 2012 2013 2014
Class P1 P2 P3 P4 P5 P6 P7
Total No. of pupils 34,597 28,124 23,394 20,199 16,760 13,289 10,446
This may lead to declining literacy levels hence affecting community development.
The Accounting Officer explained that the negative trend is due to high poverty levels
with some parents failing to provide meals, sanitary pads, and other necessities to their
children and promised to continue advocating for joint efforts to reduce the high drop-
out rate.
The matter requires urgent attention.
c) Poor State of Universal Primary Education Schools
The Local Governments Management and Service Delivery (LGMSD) Guidelines require
schools to have classrooms, teachers’ houses and latrines. Inspection of 8 primary
schools in the district revealed inadequate infrastructure as classrooms had muddy floors
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and some had walls made of rids and mud. The walls of classrooms had cracks in them
and the schools completely lacked running water facilities and accommodation for
teachers. Some of the latrines were collapsing and the roofing on the classrooms was
very old and leaking in Schools like Kyeibare, Kihesi and Kamutungu Primary Schools.
The inadequate classrooms and latrines affect the learning environment and hygiene
leading to poor pupil performance and lack of clean water puts the lives of both pupils
and teachers at risk.
The Accounting Officer explained that the district authorities will continue lobbying the
relevant Ministries and other stake holders to improve the poor state of UPE schools.
I advised the Accounting Officer to continue the lobbying and also engage all
stakeholders for ways of improving the conditions in UPE schools.
ii. Health Sector
Issue Details Response Recommendation
Drug Stock Out
There were cases of stock outs of medicine in some health
centres in the district; a case in point was Kyogo HC III which
ran-out of the medicines listed below:
TYPE OF
MEDICINE
CONSUMPTION PERIOD OF
STOCK OUT
1. Combined Oral
Contraceptive
(Family
Planning pill)
18 cycles per
month
April 2014 to April
2015
2. Erythromycin
(For treating
Sexually
Transmitted
Infections in
pregnant
women)
200 tablets in a
month
1st October 2014
to 30th October
2014
The
Accounting
Officer
explained that
the challenges
in health
service
delivery have
persisted due
to inadequate
funding which
has remained
constant for
more than
seven years
despite the
growing
population.
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Issue Details Response Recommendation
Non-functional
Theatres
Despite theatres of Health Centre IV’s being well equipped with
basic equipment, and having doctors, they were not functional.
This was mainly due to the lack of anesthetic and theatre staff.
The District Health Officer explained that the district had
advertised but did not attract applicants as the required staff
were very few in the market.
Non-functional
Solar Power
Systems
The district with the assistance of the Ministry of Health and
Development Partners, installed solar power in most health
facilities at all levels over the last 5 years. However, the
systems were failing due to the aging batteries that needed
replacement and could not store enough power thus failing the
solar power system.
Failure to have power at the health centres makes it hard for
them to handle complicated medical cases that need surgical
operation.
Non-Functional
Ambulances
The ambulances at Health Centre IV’s were not functional.
These are multi-purpose pick up ambulances that were
procured more than 10 years ago. They are old and need a lot
of resources to repair them. It was difficult for the health
centres to function without reliable means of transport for
patients that needed more specialized health care services.
I advised the
Accounting Officer
to liaise with the
Ministries of Health,
Finance Planning
and Economic
Development and
other stakeholders
to address these
short comings so as
to improve on
health service
delivery.
Inadequate
Infrastructure
The district lacked infrastructure to house all health centres.
Cases in point were Kiyebe, Nyamabare and Nyaruhanga Health
Centre II’s that are being housed in rented buildings. The three
Health Centres paid annual rent of UGX.3,000,000 which would
have been saved if they had their own buildings.
144
Issue Details Response Recommendation
Inadequate
Staff
Accommodation
All staff could not get accommodation at their stations due to
lack of houses. As a result, the health staffs either commute
from long distances or stay in outpatient departments and
wards, along with their families. The latter option implies that
the infrastructure meant for service delivery is not available.
Inadequate
Buildings in
Health Centres
Page 19 of the Primary Health Care Guidelines for the Financial
Year 2014/15 from the Ministry of Health states the basic
building’s requirements for the various levels of health care in
the district as below:-
LEVEL OF
HEALTH
CARE
BASIC BUILDINGS’ REQUIREMENTS
Health Centre
IV
medical buildings: Out Patient Department,
Drug Store with Health Sub District (HSD)
Office, Operation Theatre, General Ward,
Maternity Ward, Mortuary, Placenta pit,
Medical waste pit
staff houses: 18 housing units for staff
Health Centre
III
medical buildings: Out Patient Department,
General Ward, Maternity Ward, Placenta
pit, Medical waste pit
staff houses: 10 housing units for staff
Health Centre
III
medical buildings: Out Patient Department,
Emergency Ward, Placenta pit, Medical
waste pit
staff houses: 4 housing units for staff
Contrary to the above requirements, a number of health centres
lacked some of the required buildings as detailed in Appendix
145
Issue Details Response Recommendation
4.
5.8.3 KATUNA TC
1. Non-compliance with statutory obligations
Section 5.6.3 (5) (b) of the Local Governments Finance and Accounting Manual 2007
(LGFAM) 2007, requires all payments to be remitted to Uganda Revenue Authority (URA)
with the schedules of payers not later than the 15th day of the following month. It was
however observed that UGX.5,511,453 in respect of Pay As You Earn (PAYE) and
withholding tax deducted during the year was not remitted to URA.
In addition, there was no evidence that the 18% VAT of UGX.6,390,270 in respect of
revenue collections was remitted to URA as shown below;
Local revenue source Amount UGX
Market fees 7,435,500
Parking fees 28,066,000
Total 35,501,500
18% VAT 6,390,270
Non remittance of taxes may attract fines and penalties from the tax body.
The Accounting Officer explained that URA owed the Town Council money that was paid
erroneously and reconciliation was yet to be made.
I advised the Accounting Officer to comply with the tax law.
2. Purchases not Taken on Charge
Section 5.4.4.1 of the LGFAM 2007, requires that on receipt of goods delivered, the
Store Keeper shall count them and check for conformity with the Local purchase order
(LPO) and raises a goods received note (GRN) for acknowledgement and take the goods
146
on charge. However, a review of stores records revealed that purchases totalling
UGX.15,191,360 were not recorded in stores records.
This can lead to abuse.
The Accounting Officer explained that this was mainly due to deliveries that were field
based.
I advised the Accounting Officer to ensure that all procurements are properly recorded
in the stores records.
5.8.4 HAMURWA TC
1. Non Transfer of Shared Local Revenue
The Local Governments Act 1997 (as amended), Fifth Schedule, Part V (15a), requires
the Town Council to distribute 5% and 20% of the total Local revenue collected
amongst its Parishes and Village Councils respectively. Contrary to this provision, out of
the UGX.39,797,285 expected transfers, only UGX.4,868,001 was transferred leaving a
balance of UGX.34,929,284 not transferred.
Non-transfer of shared Local revenue denies the lower Local Councils the opportunity to
fully implement their planned activities.
The Accounting Officer explained that the un-transferred funds were spent on
construction of the new office administration block.
I advised the Accounting Officer to ensure that the shared Local revenue is remitted to
the parishes and wards as required by the law.
2. Un-authorized write off of Bad Debts
Section 2.3.4.13 (2) of the Local Governments Financial and Accounting Manual 2007
states that where a loss exceeds 50 currecy points and the loss is not recoverable, the
executive committee of Council shall inform the Minister of Local Governement who in
consultation with the Auditor General shall advise Council on the action to be taken and
grant them permission to write off the losses. Contrary to the above, debtors amounting
147
to UGX.16,174,000 were writen off without permission from the Ministry of Local
Governement. Un-authorized write off of debts is irregular.
The Accounting Officer explained that the bad debts write off was done with approval of
Council.
I advised the Accounting officer to liaise with the Minister of Local Government and
obtain approval to write off bad debts.
5.8.5 KABWOHE-ITENDERO TC
1. Failure to collect debts
Section 2.3.2.3 of LGFAM, 2007 states that any debt not collected is a serious matter
and represents a loss to Council. However, it was noted that debts amounting to
UGX.16,263,050 remained uncollected by the year end as shown in the table below;-
Name of Debtor Source of Revenue Amount
KyogabirweAnnet Shauriyako market 544,000
Kariyo B Lois Beer club Kabwohe-nyanga 160,000
Arber contractors co. ltd Trading licence 5,366,300
Mpamiza Willy Trading licence 9,792,750
MubangiziSeriano Local hotel tax 400,000
Total 16,263,050
The Accounting Officer explained that there was an ongoing effort to make the
concerned individuals pay through court.
I advised the Accounting Officer to ensure that all the debts are collected.
2. Stalled Construction of Office Block
148
The Town Council entered into a contract with a Local firm, Arber Contractors Ltd to
construct an office block at a contract sum of UGX.198,289,000. The start and
completion dates were 13th January 2015 and 13th May 2015 respectively. By the time of
audit in September 2015, UGX.108 million had been paid to the contractor which was
equivalent to 54% of the contract price. However, at the time of inspection in
September 2015, the works had been abandoned at foundation stage as shown in the
pictures below;
The Accounting Officer explained that the civil works shall be supervised very closely
and would mobilize more funds to complete it.
I advised the Accounting Officer to ensure that the civil works are properly supervised.
5.8.6 KIHIHI TC
1. Lack of Creditors and Debtors Ledgers
Regulation 59 of the Local Governments Financial and Accounting Regulations 2007,
requires each Local Government to maintain ledgers. However, it was observesed that
Creditors and Debtors of UGX.21,098,856 and UGX.12,756,000 respectively reflected in
the balance sheet lacked supporting ledgers contrary to the regulations. Consequently, I
could not confirm the accuracy and completeness of the balances reflected in the
financial statements.
I advised the Accounting Officer to establish the ledgers to enhance accuracy and
completeness of the financial statements.
149
2. Un-collected revenue from Sale of Trees
During the financial year 2012/13, Kanungu District disposed of Meizimera forest trees in
Kihihi Town Council at UGX 212,000,000. The sale agreement provided that 40% of the
sales proceeds were supposed to be credited on Kihihi Town Council account. Note 3
(statement of receivables) to the financial statements reported on expected share worth
UGX 10,410,000 from the sale of trees. The amounts remained uncollected at the time
of audit.
Uncollected receivables adversely affect Council cash flows and hinder implementation
of Council activities, hence affecting service delivery.
The Accounting Officer explained that the Chief Administrative Officer had forwarded the
matter to the Solicitor General for further management.
I advised the Accounting Officer to follow up the matter with the district to ensure that
the revenue is collected.
5.8.7 KIRUHURA DLG
1. Outstanding Salary Arrears
Regulation 54 (2) of the Local Governments Financial and Accounting Regulations
(LGFAR), 2007 provides that employees’ salaries and pensions shall be due and payable
on the last day of each month but arrangements may be made to effect earlier
payment. Section B Paragraph 25 of the Public Service Standing Orders 2010, provides
that the salary arrears that accrue to a public officer within a financial year shall be paid
through the payroll within the same financial year. On the contrary, it was noted that
the district accumulated salary arrears for health staff and teachers amounting to UGX
294,495,032.
Failure to pay employees’ salaries in time demotivates staff and negatively impacts on
service delivery.
The Accounting Officer explained that a request had been made to the Accountant
General and the Permanent Secretary/Secretary to the Treasury to pay the arrears.
150
I advised the Accounting Officer to follow up the matter with the relevant authorities
and to ensure that the salary arrears are settled.
2. Inadequate facilities in Primary schools
Section 2.1.2 (a) of the Local Governments Management and Service Delivery (LGMSD)
Operational Manual requires Local Governments to deliver services in conformity with
primary education minimum national standards of service delivery.
Analysis of the school statistics in the district revealed that the standards were below
the required minimum standards as shown in the table below;
Standard Current Ratio Minimum Standard
Classroom Pupil Ratio 1:98 1:55
Desk Pupil Ratio 1:5 1:3
The Accounting Officer explained that the district depends on Central Government
releases which are largely inadequate but the matter was being followed up with
Ministry of Education and Sports and that of Ministry of Finance, Planning and Economic
Development.
I advised the Accounting Officer to follow up the matter with the Ministry and ensure
that the challenges are addressed.
5.8.8 KISORO DLG
1. Inadequate standards in Primary Schools
Section 2.1.2 (a) Program2.1.2 (a) of the Local Governments Management and Service
Delivery (LGMSD) Operational Manual requires Local Governments to deliver services in
conformity with Primary Education minimum national standards of service delivery. A
sample of 40 schools revealed that the average school standards were below the
recommended standards as shown below;-
Standard District Ratio Minimum Standard
151
Classroom Pupil Ratio 1: 70 1:55
Teacher Pupil Ratio 1:58 1:55
Latrine Pupil Ratio 1:70 1:40
Desk Pupil Ratio 1:5 1:3
The Accounting Officer explained that the district was constrained by low funding as it
had had the same Schools Facilities Grant budget allocation since 2010.
I advised the Accounting Officer to follow up the matter with The Ministry of Education,
Sports, Science and Technology to ensure that primary schools meet the national
minimum standards.
2. Congestion at Kisoro Hospital
The maternity wards were designed to accomodate 25 patients at a time. However,
inspections carried out at Kisoro Hospital reavealed that they were accommodating over
36 patients with some sleeping on the floor and using mats.
The Accounting Officer explained that the situation was due to the influx of patients that
come from the boarders of Rwanda and the Demoractice Republic of Congo for which
they have no alternative but to provide the services.
I advised the Accounting Officer to lobby for more funding from the relevant authorities
to address the matter.
5.8.9 KISORO TC
1. Non-transfer of Shared Local Revenue
Part V of the Local Governments Act of 1997 as amended requires a Town Council to
remit 5% and 20% of the total Local revenue collected to Parish and Village Councils
that make up the Town Council respectively. It was observed that Council collected UGX
547,712,520 as Local revenue during the period under audit. However,
UGX.28,047,439 in respect of the mandatory 25% share of revenue to parish and village
Councils was not remitted. This impaired the participation of parish and village Councils
in the implementation of the community programs.
152
The Accounting Officer explained that this was because calculations for the two levels
had not been completed but promised to remit the balance.
I advised the Accounting Officer to comply with the law.
2. Failure to up-date the Property Valuation list
Section 4 of the Local Governments (Rating) Act requires the Council to review its
valuation list at least once in every 5 years, or such longer period as the Minister may
approve. It was observed that the Council’s property valuation was outdated for 5 years.
There is a risk that property rates applied may be below the current market rates.
The Accounting Officer explained that Council had advertised for procurement of valuers
to undertake the exercise but had not attracted any firm in the previous year and efforts
were on-going.
I advised the Accounting Officer to ensure that the property valuation list is up-to-date.
5.8.10 MBARARA DLG
1. Outstanding Salary Arrears
Section B Paragraph 25 of the Public Service Standing Orders provides that salary
arrears that accrue to a public officer within a financial year shall be paid through the
payroll within the same financial year. It was however, observed that the district
accumulated salary arrears for health workers and teachers amounting to
UGX.181,341,578.
The delay to pay salary demotivates staff.
The Accounting Officer explained that a verified list of the salary arrears was forwarded
to Ministry of Finance, Planning and Economic Development and the response was
awaited.
I advised the Accounting Officer to ensure that salary arrears are settled.
2. Accumulated Rental Arrears
Regulation 32 of Local Governments Financial and Accounting Regulations 2007,
requires Council through the Head of Finance to ensure that all revenues budgeted by
153
Council is promptly collected and banked intact. Contrary to the above, Council failed to
collect UGX.67,762,000 from tenants who reside in Council’s residential and office blocks
as shown below;-
HSE NO OCCUPANT RATE/MONTH UN PAID PERIOD BALANCE UNPAID
24
Hon. Mujuni V.
Kyamadiidi 150,000
May 2013-June
2015
3,900,000
UNICEF
Grounds AMPROC INC. 3,422,000 Part of April 2013
266,000
AMPROC INC
May 2013-April
2015
61,596,000
Admin. Block
A/G/ Lobby
Racheal
Mirembe
Arinaitwe 200,000
Sept 2014 -June
2015
2,000,000
TOTAL 67,762,000
Uncollected rent denies the district revenue to meet its obligations.
The Accounting Officer explained that recoveries were ongoing except for three tenants
who had been submitted to Solicitor General.
I advised the Accounting Officer to follow up the matter and ensure that rental arrears
are collected.
5.8.11 NTUNGAMO DLG
1. High Drop Out Ratio
A review of pupil enrolment trends in 208 UPE schools in the district (P7 examination
centres) from the year 2008 when the students were in primary one (24,345 pupils) to
when they sat primary seven in 2014 (6,279 pupils) (100% coverage) revealed high
dropout rate of 72% as shown in the table below:
Year 2008 2009 2010 2011 2012 2013 2014
Class P1 P2 P3 P4 P5 P6 P7
Total No. of
154
pupils 22,345 14,750 13,066 11,607 10,032 8,713 6,279
The negative trend may be due to high poverty levels and lack of a district policy to
ensure that pupils remain in schools. This may lead to declining literacy levels hence
affecting national development.
The Accounting Officer explained that the high dropout ratio was partly due to pupils
crossing over to the private schools.
I advised the Accounting Officer to liaise with other stake holders to address the factors
that cause school dropouts.
2. Health Service
Section 4 of the Primary Health Care Guidelines for the Financial Year 2014/15 from the
Ministry of Health (Page 19) state the basic infrastructure requirements for the hospitals
in the district to include; adequate staffing, outpatient department, administration
offices, operation theatres (2 rooms), female ward (at least 15 beds), pediatric ward (at
least 15 beds), maternity ward (at least 15 beds), male ward (at least 15 beds),
mortuary, placenta pit and medical waste pit among others.
A number of weaknesses that hinder effective health service delivery were noted at Itojo
Hospital as detailed below:
a) Inadequate Hospital Equipment
REQUIRED
FACILITIES
STANDARD STATUS/CHALLENGE
BEDS 60 beds minimum Hospital has over 200
patients per day i.e over 50
patients per ward
GENERATOR 2 Stand-by generators One small generator is
operational, not standby as it
155
REQUIRED
FACILITIES
STANDARD STATUS/CHALLENGE
required lacks constant fuel supply
and an automatic switch
OPERATING TABLES 2 are required Not even one table is
operational
REFRIFILATORS Mortuary lacks refrigeration,
bodies are put on mortuary
benches
WASHING MACHINES 2 are required None is functional
WARDS Hospital has only 4 wards No casualty ward, no surgery
ward or room for isolation of
infectious cases.
b) Poor state of Hospital Infrastructure
The ceiling of the outpatient department of the hospital was leaking due to old
roofing. This led to the breakdown of various parts of the ceiling as seen in the
picture below.
156
c) Understaffing in the Hospital
The approved staffing is 183 but only 136 positions are filled representing 74%
leaving a gap of 47 (26%). Details in the table below;-
Department Approved Filled Vacant
Medical officers 7 5 2
Dental 4 2 2
Pharmacy 3 5 (2)
Nursing 116 70 46
Allied health professionals 23 22 1
Administrative and other staff 15 8 7
Support staff 15 24 (9)
TOTAL 183 136 47
d) Outstanding Utility Bills
The Hospital had accumulated an electricity bill amounting to UGX.286, 355,594 over
a period of 3 years. The hospital is exposed to the risk of being cut off power supply
which may cause operational challenges.
e) Expired Drugs
Inspection of drug stores at Itojo Hospital revealed that the hospital had a pile of
expired drugs. The expired stock included drugs that expired in 2011 but were still
lying in the stores. Expired drugs are a financial loss to Government. Besides,
delayed disposal poses a risk to the lives.
f) Hygiene
The hospital sewage system is blocked and it does not function properly as some
pipes that take waste to the lagoon are very old and broken and thus the hospital
toilets don’t function.
g) Lack of Constant Water Supply
157
There’s no constant water supply as the water pump that provides underground
water can’t operate without electricity and the water pump is too strong for the
generator to run.
h) Encroachment on Hospital Land
The hospital has no titles to their land which exposes it to encroachment as the
cemetery land had been encroached on by one Rutaro Hitler.
i) Absence of Store Keeper
At the time of audit inspection, none of the two store keepers was present. In case
of a shortage of medicines in the pharmacy, the medicine in the stores can’t be
accessed.
The Accounting Officer explained that the poor health services were due to inadequate
funding.
I advised the Accounting Officer to liaise with the Ministries of Finance Planning and
Economic Development, Health and Local Government and other authorities so as to
improve on staffing levels, health infrastructure, equipment and funding for better
service delivery.
3. Financial Statements for Health Centres
Regulation 62(4 & 5) of the Local Governments Financial and Accounting Regulations,
2007 states that the officer in charge of a health unit shall submit monthly financial
statements to the sub-county and where the health unit is unable to prepare the
financial statements, assistance shall be sought from the sub-accountant of the sub
county and copies of the financial statements to be copied to the District Chief
Executive. The district has 40 health centres which spent UGX.3.394, 103,044. The
Health units were not submitting monthly financial statements to the sub county and the
chief executive at the district. Failure to present financial statements impairs informed
decision making.
The Accounting Officer explained that this was due to understaffing, lack of training and
low levels of practical experience by clerks.
158
I advised the Accounting Officer to provide the necessary guidance to ensure that
financial statements are prepared in accordance with the regulations.
5.8.12 RWASHAMAIRE TC
1. Non Remittance of Taxes
Section 123(1) of Income Tax Act Cap 340, provides that a withholding agent shall pay
to the commissioner any tax that has been withheld or that should have been withheld
under this Part within fifteen days after the end of the month in which the payment
subject to withholding tax was made by the withholding agent. However a review of
payment vouchers revealed that Pay As You Earn (PAYE) and Withholding Tax (WHT)
amounting to UGX.5,322,709 that was deducted from staff allowances was not remitted
to Uganda Revenue Authority (URA).
Non remittance of tax may attract fines and penalties from the tax authority.
The Accounting Officer explained that the taxes will be paid.
I advised the Accounting Officer to comply with the law to avoid fines and penalties.
5.8.13 RUKUNGIRI DLG
1. Rehabilitation of 13.1 km Access roads in Nyarushanje Sub County under
batch A lot 9Ref: CAIIP-3 RUKU/WRKS/2012/13/CAR-BATCH A LOT 9
Ms. RUP Engineering Ltd was awarded a contract for the rehabilitation of 13.1 Km access
roads in Nyarushanje Sub County at a cost of UGX 1,055,518,225.
It was noted that out of the contract sum of UGX 1,055,518,225,
UGX.405,000,000 had been paid.
The contract had expired on 26th June, 2015 but works were still on-going. No
evidence of contract extension.
The inspections carried out on 30th June 2015 on Nyakishenyi – Minera section covering
a distance of 5.6 Km and the bridge works revealed poor workmanship by the
Contractor as shown below;
159
Picture 1: No head walls installed
Picture 2: Blocked culverts, no head walls, inadequate murram on the road
The Accounting Officer explained that all the anomalies identified would be fixed by the
Contractor.
I urged the Accounting Officer to ensure that the contractor is not paid before executing
the Contract as per agreement.
5.8.14 RUKUNGIRI MC
1. Lack of a Master Plan
Section 32 Part 1 (b) 3rd schedule of the Local Governments Act requires an urban
Council to have a master plan for proper land use and coordinated development.
However, it has been observed that Council has no approved master plan from the
160
Ministry of Lands Housing and Urban Development. This exposes the Council to a risk of
unplanned developments.
The Accounting Officer explained that the draft plan had been submitted to Ministry of
Lands, Housing and Urban Development for approval.
I advised the Accounting officer to follow the matter and ensure that the master plan is
approved.
5.8.15 IGORORA TC
1. Failure to do Property Tax assessment
Section 4.3.1 of the Local Governments Finance and Accounting Manual 2007 requires
urban Councils to appoint a committee to do property tax assessments based on
valuation of land and buildings. It was observed that the Town Council did not do the
valuation of properties for the purpose of property tax assessment and collection. There
is a risk that the Town Council applied rates lower than the current market rates.
The Accounting Officer promised to budget for valuation and assessment of properties in
the Town Council in the financial year 2016/2017.
The matter requires urgent attention.
5.8.16 BUTOGOTA TC
1. Audit of Financial Statements
A review of the financial statements revealed the following shortcomings;-
1.1 Lack of Fixed Assets Schedule
It was observed that the Town Council reported net assets of UGX.82,587,789 in the
balance sheet and a depreciation charge of UGX.36,444,608 in the income and
expenditure statement. However, no fixed assets schedule was attached to the financial
161
statements to support the figures. In the circumstances, I could not confirm the
accuracy of depreciation charge and the value of assets reported.
1.2 Misstated Capital Reserves
Capital reserves at the end of previous financial were reported in the balance sheet as
UGX.124,699,701 and yet note 12 to the accounts reported capital reserves brought
forward of UGX.118,064,861. This implies that capital reserves were misstated by
UGX.6,634,840. The misstatement makes the financial statements wrong.
1.3 Balance sheet
The entity presented unbalanced balance sheet with net assets of UGX.82,587,787
against net worth of UGX.2,330,679 giving rise to unsupported assets worth
UGX.84,356,399. I could not confirm how the assets were financed /acquired.
1.4 Lack of Notes to the Cash Flow Statement
It was observed that presentation of items in the cash flow statement contradicts the
Local Government Financial and Accounting Manual, 2007. The cash flow statement did
not have explanatory notes, and as such I could not confirm the reported figures.
The above matters were brought to the attention of the Accounting Officer but were not
responded to.
I urged the Accounting Officer to ensure that the matters are addressed and the
financial statements prepared in compliance with the Local Government Accounting
Framework.
5.8.17 SHEEMA DLG
1. Failure to honour staff contractual obligation
Section B-a (17) of the Public Service Standing Order states that a public officer’s
individual contractual obligations such as hire purchase, loan, and contributions to
saving schemes, trade unions and staff associations may be deducted from his or her
salary in accordance with the regulations. A review of the payroll data revealed that
162
various district officers acquired loans from various financial institutions and the district
guaranteed to remit monthly deductions to the financial institutions. However, the
district did not honour its obligation. The District officers owed institutions a total sum of
UGX.201,181,640 in form of monthly deductions at the time of audit.
Failure to deduct the required installments owed to financial institutions is a breach of
loan agreement and may lead to litigation.
I advised the Accounting Officer to ensure that the funds owed to the financial
institutions are recovered from the relevant officers and remitted regularly.
5.8.18 BUGONGI TC
1. Lack of a master Plan
Section 32 of Part 1 (b) of 3rd Schedule of the Local Government Act 243 requires an
urban Council to have a master plan for proper land use and coordinated development.
The Town Council came into existence in the financial year 2010/11. However, audit
observed that Council had not secured an approved master plan for the Town Council
from the Ministry of Lands Housing and Urban Development.
Lack of a structural urban plan exposes the Town Council to a risk of unplanned
developments.
The Accounting Officer explained that a draft plan had been submitted to the Ministry
and was scheduled for consideration.
I advised the Accounting Officer to follow up the matter with Ministry of Lands Housing
and Urban Development and ensure that the master plan is approved.
5.8.19 BUHWEJU DLG
1. Outstanding Salary Arrears
Section B-a (11) of Public Service Standing Orders 2010 requires the Accounting Officer
to ensure that a public officer accesses the payroll within four (4) weeks from the date
163
of assumption of duty. A review of the employees’ records revealed that some district
employees had not accessed the payroll resulting into salary arrears of
UGX.136,268,682.
Delayed salary payment demotivates staff.
The Accounting Officer explained that submissions to Ministries of Finance, Public
Service and Local Governments were made and payment was awaited.
I advised the Accounting officer to follow up the matter with the relevant authorities and
ensure that the salary arrears are settled.
5.8.20 RUBAARE TC
1. Non Remittance of Shared Local Revenue
The Local Government Act 1997 (as amended), Fifth Schedule, Part V (15a), requires
the Town Council to distribute 5% and 20% of the total Local revenue collected
amongst its wards and village Councils respectively. However, the Town Council did not
transfer UGX.39,204,195 to the lower Local Councils. Non remittance of shared Local
revenue denies the lower Local Governments the opportunity to participate in planned
community programs.
The Accounting Officer explained that the Town Council would transfer the unremitted
funds to the wards in installments in the FY 2015-16.
The Accounting Officer’s promised action is awaited.
5.8.21 RUBIRIZI DLG
1. Outstanding Salary Arrears
Regulation 54(2) of Local Governments Financial and Accounting Regulations
2007 requires employees to be paid monthly salaries and employees’ salaries on the last
day of each month. However, a review of the staff records of the entity revealed that
UGX. 51,424,559 of salary arrears remained unpaid at the time of audit.
Accumulation of salary arrears demotivates staff.
164
The Accounting Officer explained that efforts had been made to inform relevant
Ministries on this matter for appropriate action but no response had been received.
I advised the Accounting Officer to follow up the matter with the relevant Ministry to
ensure that the arrears are paid.
5.9 SOROTI BRANCH
5.9.1 ABIM DLG
1. Financial management of UPE Funds
Section 64(4) of Local Government Financial and Accounting Regulation 2007 require
primary Head Teachers to keep proper cash books in respect of all sums of money
received and expended by the school and the matters in respect of which receipt and
expenditure take place.
During the financial year 2014/15, UGX 162,384,016 was released to different UPE
schools in the district and the documentation review revealed the following
shortcomings.
Lack of cashbooks and bank statements
Vouchers not sequentially numbered
Poor filing of accountabilities
Inadequate accountabilities
The Accounting Officer promised to train the Head Teachers in basic book keeping.
I advised the Accounting Officer to ensure that all Head Teachers are trained in book
keeping.
2. Inadequate Infrastructure under Primary Education in the District.
Section 2.1.2 of the Local Government Management and Service Delivery (LGMSD)
Guidelines 2009 provides the Minimum National Standards of Service Delivery for UPE
schools. The analysis of statistic data for the Primary Schools in the district revealed that
a number of them do not meet the minimum standards as shown below;
165
Details Standard District
achieved level
minimum
standard
number of class rooms Classroom pupil ration 1:72 1:55
No of Text Books Text book Pupil ration 1:8 1:3
number of desks Desk pupil ratio 1:11 1:3
Audit inspections of sampled Primary Schools also revealed the following shortcomings;
School Findings Pictures
Abim
primary
School
Dilapidated class room blocks
Lack of desks (from p1 to p6)
Lack of boys domentry (boys
sleep in class rooms) Lack of a kitchen and dining hall
Sinking toilets and dilapidated
bathroom
Inadequate staff houses, only 6
out of 25 teachers are housed.
Lack of teachers toilets
Koya
Primary
school
Lack of enough desks
Lack of staff accommodation
most teachers sleep in grass
thatched houses
Dilapidated pupils toilets
Lack of staff toilets
Wilela
primary
School
Lack of office and staffroom
Dilapidated kitchen
School premises are not fenced
and gardens are destroyed by
community animals
Inadequate staff
accommodation (only 4/14
teachers are housed)
Inadequate desks
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School Findings Pictures
Gulotoro
Primary
School
Two water tanks are vandalized
Lack of pupils desks (only the
pieces of brocken ones)
Lack of office and staff room
p.1 is used as an office
Lack of teachers
accommodation and toilets
(only 2 out of 10 teachers
housed)
Alerek
Primary
School
Inadequate class rooms for
pupils
P1 to P5 completely have no
desks and other classes desks
are few
Latrines are filled up and no
doors
Inadequate staff
accommodation, only 10 out 21
teachers are housed and others
sleep in grass thatched houses.
Inadequate pupils books
The school land is not fenced
Rongom
Primary
school
Inadequate and dilapidated
classrooms
Lack of teachers toilets
Inadequate staff houses and
teachers are housed in grass
thatched houses
Katala
Primary
school
In adequate pupils class rooms
(one of the class room’s roof
swept by wind)
In adequate staff
accommodation
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Dilapidated structures create a potential hazard to the school community.
The Accounting Officer attributed the shortcomings to lack of funds for infrastructure
development.
I advised the Accounting Officer to engage the Ministry of Education Science and
Technology and other relevant stakeholders for improved funding.
5.9.2 ABIM TC
1. Service Delivery
1.1 Water Sector
Section 14 of the PPDA regulations require an Accounting Officer to have the overall
responsibility of the successful execution of the procurement, disposal and contract
management processes and ensure that implementation of the contract are as per the
agreed terms.
During the financial year 2013/14, a Local firm was contracted to undertake works and
management of Abim water supply and sewerage system. The company was to receive
a management fee of 85% of monthly collections, 10% for capital investment & major
repairs and 5% to water board expenses. An account in the names of Escrow was
opened for collections to be deposited before sharing. However, audit of the water
project revealed the following anomalies:
No records were provided for the Escrow a/c transactions making it difficult to
confirm whether all receipts were banked and shared as per the contract terms.
There was no evidence of supervision of the project by Council and the contractor’s
books had never been audited by the Internal Audit of Council.
The Council undertook direct collections on the Urban water Account in the form of
application fees and other charges amounting UGX 27,960,300 but there was no
work plan for water activities on which the funds were used.
168
Analysis of the project revealed that it was not viable due to the low collection
efficiency and high running costs noted below;
− The total billing from April 2014 to May 2015 was UGX 45,697,550 but the total
collection was UGX 35,059,450.
− The management fee payable was UGX 27,136,200 compared to the total
running cost of UGX 43,754,546.
The Accounting Officer explained that poor performance of the private operator was
noted but the Karamoja umbrella would continue to help Council with regular
evaluation to ensure that the private operator performs.
I advised the Accounting Officer to enhance the supervision of the project and
ensure that the expected benefits are achieved.
2. Local Government Management Service Delivery
2.1 Incomplete Civil Works on construction of 2 classroom block at Amul primary
School
Section 14 of the PPDA regulations require an Accounting Officer to have the overall
responsibility of the successful execution of the procurement, disposal and contract
management processes and ensure that implementation of the contract are as per the
agreed terms.
During FY 2010/11, the Council contracted a Local firm for construction of a 2 Classroom
block in Amul primary school at a contract sum of UGX. 29,948,020.. However, the
works stalled with no evidence of progress on site as shown in the photo below;
The project was behind schedule by 4 years.
The Council had earmarked an amount of UGX 13,872,620 to complete the payment.
169
Delayed completion of projects may lead to extra administrative costs and denies the
community the intended services.
The Accounting Officer explained that management wrote to the district contracts
committee for a variation in the contract price as assessed by the user department but
to date no action has been taken.
I advised the Accounting officer to follow up the matter with the district contract
committee for approval of the variation and ensure that the classroom block is
completed.
5.9.3 BUKEDEA TC
1. Unverifiable Comparative Figures
Regualtion 70 of Local Government Financial and Accounting manual requires the Chief
Executive to submit the financial statements to the Auditor General for audit.
I reported last year that fininancial statments for financial year 2013/14 wre not availed
for audit contrary to regualtions. The matter has not been resolved.
Consequently, I was not able to veerify comparative figures reported in the current
financial year statments.
The Accounting Officer promised to avail the financial statements.
I advised the Accounting Officer to always ensure that comparative figures presented
are supported by financial statements.
5.9.4 KOTIDO DLG
1. Education Sector
1.1 Kacheri Secondary School
The Inspection of Kacheri secondary school revealed the following shortcomings:
170
A school facility ( a block of 4 classrooms with chairs) constructed at a cost of UGX
239,456,000 has remained unutilised for the last two years.
The school facilities are not maintained. There is bush in the compound and
surroundings.
The school buildings and furniture were abandoned without any security as shown in
the photos below:-.
Unutilized desks in classroom Bushy compound near classrooms Fencing around school land
The Accounting Officer explained that the school lacked sanitary facilities, housing and
accommodation for teachers and that these are planned for in the next financial year
2016/2017.
I advised the Accounting Officer to prioritise the allocation of resources and ensure that
the school functions properly.
1.2 Payment for no work done
During the FYR 2011/12, the district contracted a Local firm for completion of an
administration block at Panyangara SS at a contract sum of UGX. 189,701,500. The
contract start and end dates were 15/12/2011 and 10/5/2012 respectively. A total
payment of UGX 182,424,753 (96%) had been made by 27/5/2014.
It was observed that a total of UGX 15,664,000 was paid to the contractor for no work
done as shown in the table below;
171
Item. No Items not supplied Qty Unit Price UGX
Amount UGX
1 Chairs 60 125,000 7,250,000
2 Office tables 4 1,200,000 4,800,000
3 Staffroom tables 9 250,000 2,250,000
4 Nim trees 40 20,000 400,000
5 Lightening protection 714,000
Total 15,414,000
The Accounting Officer promised that the district will compel the contractor to complete
the remaining works before retention money is paid.
The matter requires urgent attention.
5.9.5 KUMI DLG
1. Wasteful Expenditure
Paragraph 9(2)(b) of the Local Governments Finance and Accounting Regulation, 2007
state the duties of the accounting officer among which is to ensure that the public
moneys, property and resources for which he or she is responsible are properly
managed and safeguarded.
A Local firm was awarded a contract to construct an arch bridge on Ogoloi-Ongoria
Swamp at a cost of UGX. 45,381,000 funded by NUSAF 2. By the time of audit all the
money had been paid.
However, physical inspections in September 2015 revealed that the arch bridge was
constructed in the middle of a swamp without any connecting roads rendering the
expenditure wasteful and no value for money achieved for the money spent as shown in
the photos below;
172
Cross-sections of Ogoloi -Ongoria Arch Bridge swamp crossing without connections to any
road
The Accounting Officer explained that the district had anticipated more financing from
NUSAF to open the linking roads but the funds were never received.
I advised the Accounting Officer to pursue the funding and ensure that the purpose for
which the arch bridge was constructed is achieved.
5.9.6 MOROTO DLG
1. Financial management of UPE Funds
Section 64(4) of Local Government Financial and Accounting Regulation 2007 requires
primary head teachers to keep proper cash books in respect of all money received and
expended by the schools.
However, documentation review of 7 schools revealed incomplete Cash Book, absence
of the original accountability documents, failure to pre-sequentially number vouchers.
The Accounting Officer explained that the district is planning to build head teachers skills
in book keeping through capacity building grant and also encouraging them to take
short courses to upgrade their knowledge of financial reporting.
I urged the Accounting Officer to ensure that all the head teachers are properly trained
in basic accounting.
173
5.9.7 NAKAPIRIPIRIT TC
1. Unsupported Account Balances in the Financial Statements
Regulation 59 (c) of LGFAR 2007, require each Local Government Council to maintain a
general ledger and subsidiary ledgers.
There were no Expenditure and Revenue Ledgers availed for audit. Consequently the
account balances in the financial statements were unsupported.
The Accounting Officer attributed this to inadequate Accounting Knowledge of the head
of finance.
I advised the Accounting Officer to ensure that Ledgers are always prepared and also to
organise an accounts basic course for the head of finance.
5.9.8 SOROTI DLG
1. Dry Boreholes
Regulation 15 (4) of the LGFAR 2007, states that if at any time the funds managed by
the administration sustains a loss by reason of the neglect or default of any officer, the
officer shall be liable to be surcharged with the amount and any sums due to him.
The district signed a contract with a Local firm for drilling, casting, installing and test
pumping 12 deep bores under lot-1 out of which, 5 boreholes paid for at a total cost of
UGX.43,565,836 were dry implying that no value for money was achieved.
The Accounting Officer attributed the shortcoming to differences in the sighting and
drilling contractor and yet dry wells are discovered after test pumping has been done.
I advise the Accounting Officer to enhance supervision to avoid losses in future.
2. Audit Inspection of Primary school facilities
174
Audit inspection revealed that most of the schools had very poor accommodation for the
teachers and poor classroom structures as shown in the table below;
Name of School Issue Photos
Obule Primary School
Old and dilapidated teachers’ accommodation that potentially are harmful to their health.
Obule Angorom Primary School
Poor teacher’s accommodation Structures and Students of P.4 were seated down .
Tubur Primary School
Students in P.1 were seated on the floor and poor accommodation structure
The Accounting Officer explained that funds, disbursed by the Central Government to
the district annually cannot meet demands for classroom accommodation.
I advised the Accounting Officer to liaise with relevant authorities for increased SFG
funding to rehabilitate the schools.
5.9.9 SOROTI MC
175
1. Service Delivery
a. Dilapidated school accommodation and classroom structures
Audit inspection revealed that some of the schools had very poor classroom structure
and old toilet facilities as shown in details below;
Name of School Issue Photos
Aloet Primary
School
The school has dilapidated
classroom structures that are
dangerous to both the pupils and
teachers.
The school has got no staff room
block. The teachers were found
seated and marking pupil’s exercise
in the compound.
Pioneer Primary
School
The school has dilapidated staff
accommodation structures that are
dangerous to the teachers.
The school also has dilapidated
classroom structures that are
dangerous to both the pupils and
teachers.
The Accounting Officer explained that school buildings are gradually being rehabilitated
in a phased manner due to inadequate funding. He added that more lobbying has to be
done by all stakeholders.
176
I advised the Accounting Officer to liaise with relevant authorities to ensure that
classroom structures are rehabilitated.
5.9.10 NGORA DLG
1. Book Keeping in U.P.E Schools
Section 64(4) of Local Governments Financial and Accounting Regulations requires
primary head teachers to keep a cashbook in respect of all money received and
expended by a school.
However it was observed that 56 Primary Schools lacked the necessary books of
account.
This weakens controls over use of funds at the primary schools
The Accounting Officer explained that training had been planned under capacity building
grant of LGMSD for the financial year 2015-2016.
I advised the Accounting Officer to ensure that the planned training is undertaken for all
the schools in the district.
2. Service Delivery.
Paragraph 9 (b) of the Local Governments Financial and Accounting Regulation, 2007
require the accounting officer to ensure that the public moneys, property and resources
are properly managed and safeguarded. However, audit inspection revealed at the
following short comings:-
2.1 Idle Dental Machine and Theatre Equipment
The district paid a Local firm UGX.16,000,000 for the supply of Dental Machine to Ngora
Health Centre IV.
However, the machine was still idle and packed 20 months after delivery as shown in
the photos below.
177
Dental machine still parked 20 months after delivery
2.2 Idle Theatre Equipment
The District paid a Local firm UGX. 34,670,000 for supply of an operating bed, Autoclave
Machine and Anaesthetic Machine to Ngora Health Centre IV.
Similarly the machine was idle and still parked 2 months after delivery. See photos
below.
Theatre equipment still parked 2 months after delivery
Having functional equipment that is not in use denies the public the needed service.
I advised the Accounting Officer to provide rooms for the two machines so that they can
be utilised to avoid wasting away and denying service to the public.
2.3 Audit Inspection of Primary school facilities
178
Audit inspection revealed that most of the schools had very poor accommodation for the
teachers and poor classroom structures as shown in the table below;
Name of
School
Issue Photos
Akarukei
Primary
School
Dilapidated
classroom
structures that
are harmful to
pupils health.
Old Classroom Structures
Atapar
Primary
School
Poor classroom
structures and
teacher’s
accommodation
Structures
Kodike
Primary
School
Poor classroom
structures and
teacher’s
accommodation
Structures
Koloin
Primary
School
Poor Classroom
Structures
179
Name of
School
Issue Photos
Omuriana
Primary
School
Poor
Accommodation
structures,
The Accounting Officer attributed the challenges to limited funds, disbursed by the
Central Government.
I advised the Accounting Officer to liaise with the relevant authorities for increased SFG
funding to enhance infrastructure.
3. Stores/Inventory Management.
Regulation 83 (1) of the LGFARs of 2007 requires the district to have stores section and
to employ a suitably qualified and experienced officer to be the stores control officer and
head of that section.
However it was observed that the stores lacked aqualified personnel and the items
were not properly arranged as shown below and ledgers were also not up-to-date
Store with disorganized inventory
The Accounting Officer admitted the shortcomings and promised that a stores assistant
will be recruited next financial year to address the matter.
The matter requires urgent attention.
180
5.9.11 NGORA TC
1. Dilapidated Township school structures and congested classrooms
Audit inspection revealed that Ngora Township School had very poor classroom
structures while the existing ones were congested as shown below;
Name of
School
Issue Photos
Ngora
Township
Primary
School.
Dilapidated classroom structures
that are harmful to pupil’s health.
Poor classroom and teacher’s
accommodation Structures
181
Name of
School
Issue Photos
Congested classrooms that make
the environment un healthy to both
teachers and pupils.
The Accounting Officer explained that the situation will be brought to the attention of
Council and the District as more funding is sought from Peace Recovery and
Development plan (PRDP) and Local Government Management and Service Delivery.
I advised the Accounting Officer to liaise with the relevant stakeholders including
Ministry of Education and ensure that the infrastructure is rehabilitated.
5.9.12 SERERE DLG
1. Service Delivery
1.1 Education Sector
a) Book Keeping and financial management of UPE Funds
Section 64(4) of Local Governments Financial and Accounting Regulation 2007 require
primary head teachers to keep a cash book in respect to all money received and
expended.
During the year under review, UGX 457,126,475 was released to different UPE schools
in the district, however, a review of the accounting records revealed the following
shortcomings.
Some schools have no cashbooks.
Some cash books are not properly posted.
Vouchers were not properly written and numbered sequentially.
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Lack of payment vouchers and accountabilities
This is an indication of poor financial management.
The Accounting Officer explained that the head teachers were earlier on trained but just
failed to put in practice the skills attained.
I advised the Accounting Officer to explore the possibility of using sub accountants at
sub county level to help financial management of primary schools.
b) Inadequate and Dilapidated Infrastructure in Primary Schools
Section 2.1.2 of the Local Governments management and Service Delivery (LGMSD)
guidelines 2009 provides the minimum National Standards of Service Delivery for UPE
Schools. Documentation review and field inspection revealed a number of shortcomings
as shown in the table below:-
School Findings Pictures
Kamod Pri Sch. Dilapidated p.1, 2 & 3
block which is likely to
cause an accident any time
Deteriorated dining hall
and dormitory block
Inadequate teachers
accommodation
Lack of teachers toilets
Lack of power
Teachers accommodation teacher/house ratio
etc.
183
School Findings Pictures
Agule Pri sch. Congested class rooms
Lack of enough desks
Lack of staff
accommodation
Lack of staff toilets
Lack of safe water
Abulabula Pri
Sch.
Congested class rooms
with over 200 pupils in P1
and 198 in P2
Lack of desks in p1, p2 and
P3
Inadequate books
Lack of teachers house and
teachers have opted to
sleep in class rooms, office
and a store
Aputon Pri Sch. The school has no space
for the office and office
work is conducted from the
veranda and in cases of
weather change, P2 class
is used as an office
Lack of teachers
accommodation and toilets
Inadequate class rooms
(all class rooms are
congested)
Inadequate books
Inadequate desks, P1 have
no desks at all
184
School Findings Pictures
Adukut Pri Sch. In adequate teachers
accommodation and P.1 is
being used to
accommodate some
teachers and one of the
teachers house is in a bad
state.
Inadequate class rooms for
pupils
P1 & P2 completely have
no desks and other classes
desks are few
Lack of beds in the boys
and girls dormitories
Labor Pri Sch. The roof for a 4 class room
block was swept by the
wind and no action take
since February
In adequate toilets
Lack of teachers
accommodation
P1 & P2 have no desks
Kamurojo Kakor
PS
Lack of desks and
classrooms
Aep Primary
School
Inadequate classrooms
185
Dilapidated structures impacts adversely on the academic performance of the schools.
The Accounting Officer explained that the district has always submitted the stock of
classrooms, latrines, teachers’ houses and desks against the required numbers to
Ministry of Education and sports but little has been done on the indicative planning
figures.
I advised the Accounting Officer to continue engaging the Ministry of Education and
other stakeholders for additional funding.
