GOVERNMENT EMBARKS ON CONSOLIDATING ITS ACCOUNTS
A cross section of workshop participants
A stakeholder workshop organised by the Ministry responsible for Finance and Economic Planning in close collaboration with Human Resources and Institutional Capacity Development Agency (HIDA) was held on 9th January 2006 at Prime Holdings Conference Hall. Participants at the workshop included Secretaries General, Director Generals as well as Directors of Finance of public institutions and other high ranking government officials.
This workshop provided a forum for the Ministry to share and discuss with stakeholders the contents of the Organic Budget Law (OBL) which was legally enacted on 12 September 2006. The Secretary General of MINECOFIN, Mr. John Rwangombwa, explained that the OBL aims at establishing principles and modalities for sound management of state financial resources in terms of planning, budgeting, and allocation according to strategies and means of the state as well as monitoring and reporting.
At the same workshop, an International Consulting Firm, PricewaterhouseCoopers (PwC) presented an inception report of the assignment to consolidate government accounts for the year ending 31 December 2006 to clear the backlog of accounts. The World Bank, through the Public Sector Capacity Building Project (PSCBP) coordinated by HIDA is supporting MINECOFIN to strengthen the Public Financial Management System in the country. To this effect, the Ministry was facilitated to contract PwC to provide technical support to the Government accountants to prepare the books of accounts. This exercise commenced in December 2006 and final accounts will be ready by end of March 2007.
TTo kick start the process the presentation of the inception report at the workshop was held with an aim of creating awareness and preparing the relevant staff in public institutions to provide the necessary information about their accounts. The Minister of Finance and Economic Planning, Hon. James Musoni, officially opened the workshop. In his speech he stated that all public institutions are under obligation to provide the required information in the stipulated timeline. He added that the exercise of consolidating government accounts was an important government undertaking and should be fully owned across government institutions.
These Consolidated Public Accounts will span various reporting entities namely: the central government ministries; semi-autonomous agencies; commissions; embassies, local authorities; and the autonomous state owned corporations who are recipients of subsidies from central government.
Each reporting entity will present individual sets of annual financial statements and MINECOFIN will consolidate the accounts and forward them to the Auditor General before 31st March 2007 as required by law. Reporting will be under the cash basis of accounting.
Management of financial resources of any country must have a prudent financial system backed by sound and effective accounting procedures and internal controls. A well-designed and well managed accounting system helps ensure proper control over public funds. Weak capacities in financial management and inadequate enforcement of, and compliance with, the rules are likely to undermine prospects for attaining transparency and accountability in use of all public resources. It is for this reason that Government has been carrying out reforms in public financial management for the past 12 years, which focused initially on rebuilding systems and capacities. Progress has so far been made in institutionalizing financial accountability throughout government structures, including legislative and executive branches.
Government has identified public accounting as a priority area to be addressed in order to attain good economic governance. This initiative of consolidating public accounts is a major landmark because there have been no auditable consolidated public accounts since 1980’s and this has been an subject of major concern to Government. For the first time, the Government will have access to a set of Consolidated Public Accounts showing the revenues, expenditures, financial assets and liabilities at a national level.
This exercise, therefore, in addition to other on-going public financial management reforms, will lay a firm foundation for public financial management and economic planning in the future.
