Turnall Holdings Ltd is probing a series of transactions amid suspicions of corruption and fraudulent activities implicating top executives of the listed company which could have bled the firm over US$300 000.
By Fidelity Mhlanga
Documents seen by businessdigest this week show that preliminary investigations of the Navision system by internal auditors unearthed a series of suspicious transactions which are being subjected to interrogative investigations, verifications and evidential tests.
Navision (Dynamics NAV) is an ERP (Enterprise Resource Planning) Solution designed for small-to-mid-sized businesses to automated the majority of their transactions from CRM (Customer Relationship Management), to Quoting, Ordering, producing, shipping and Invoicing on the sales side, to Purchasing, Receiving, Paying and Inventorying on the supply side.
According to an initial internal investigation report prepared in May this year, the company’s Financial Director Kenias Horonga and Procurement Manager Tapiwa Parirenyatwa are being investigated for allegedly sharing US$300 000 with one Marsden from a South African-based company known as Marley SA.
According to the documents seen by businessdigest, the investigators are keen to establish whether the Turnall duo hatched a deal with Marsden for the supply of pressure pipes which was justified by misrepresentations, falsehoods and misleading information and yet the products were never delivered.
Investigators fear the deal could have been done to help Marsden whose business is said to have been in shambles.
The transaction resulted in Turnall incurring costs of employing Marsden and his staff.
It is said the deal also resulted in US$300 000 being paid to Marsden, Horonga and Parirenyatwa.
Investigators are also probing possible corrupt awarding of tenders, suspected fraudulent invoicing, preferential and pre payments to a company called Bosch at the expense of raw materials and critical spares to Turnall.
Turnall manufactures and supplies roofing accessories, water and sewerage conveyance products.
The investigators are also trying to acsertain whether the duo took their wives to China and Europe on company funds on non-business related trips at a time the firm is facing cash flow shortages and failing to procure raw materials.
“It is alleged that there is evidence to the effect that wives were taken abode for the Dubai Trip. It is alleged that other trips to Europe were for leisure and not bringing any value to Turnall,” reads part of the report.
Contacted for comment Horonga initialy said he was not aware of the investigations. “In responding to the allegations being levelled against me, I do not know what you are referring to. Everything I have done has been above board. I am not aware of the internal audit report that you are referring to. Should you want to meet and discuss I am available in the afternoon as I have a board meeting in the morning,” he said in a whatsapp response.
But in a late afternoon meeting with businessdigest yesterday after a Turnall board meeting, Horonga confirmed the audit was carried out by their internal auditors Ernest & Young, adding it was completed in July.
He could not be drawn to share the results of the audit, referring all questions to the company’s audit committee’s chairperson Bothwell Nyajeka and board chairperson Rita Likukuma.
“The internal audit was done after an anonymous letter with these allegations was sent to our chairperson…it was done by Ernest & Young who are our internal auditors and it was completed in July,” Horonga told businessdigest at the company’s head office in Harare yesterday. “It will be proper to deal with Bothwell Nyajeka who chairs our audit committee. Our board chairperson is also here I can call her for you.”
A non-executive director, who was invited by Horonga to the meeting, before calling MD Caleb Musodza into the meeting. Musodza refused to comment, saying the company was in a closed period.
“We are in our closed period pending reporting and publishing of our half year 2016 results shortly as per the ZSE rules, and consequently as you may appreciate, I will not be able to respond to your questions. Please feel free to contact me as soon as we publish our results,” read his e-mail response.
Internal auditors are looking to establish possible underhand dealings between Horonga with a firm called Quickdrill, which allegedly got selective discounts. The investigators also want to ascertain possible abuse of substandard sheets, false product returns and credit notes.
The FD and Procurement manager are also under fire over how they engaged partners in fibre importation, clearing agents as the company incurred high rate of process loss, rejects and product return.
Horonga was previously employed in the same position at Coldom until 2012.
A forensic investigation into Innscor Africa Ltd’s subsidiary — Colcom Ltd — claimed his scalp and his purchasing manager after an audit unearthed questionable procurement procedures and porous systems at the company.
The audit revealed that there were questionable tender procedures where most of the goods procured from South Africa would land at the Colcom offices at inflated prices. Early this year , former Turnall MD Abel John Jere, ex-marketing director Edwin Kondo and technical director Francis Chigwedere were appeared in court on charges of embezzling US$2,5 million.
A Swiss-based company Ramatex SA last month dragged Turnall to the High Court in a bid to recover US$1,1 million which the local firm has failed to pay for raw materials supplied.