AN explosive internal audit into the Ministry of Health and Child Care has lifted the lid on poor financial controls and gross corporate governance failures at the National Microbiology Reference Laboratory (NMRL), the Zimbabwe Independent can reveal.
With the country’s health sector in a state of paralysis, the shocking revelations were contained in the audit report, which was presented to Health and Child Care minister Obadiah Moyo and his permanent secretary, Agnes Mahomva four months before Zimbabwe recorded its first death from the raging Covid-19 pandemic.
The disease has killed four and infected 28 in Zimbabwe. In March, when talented broadcaster Zororo Makamba became the first fatality at Wilkins Infectious Diseases Hospital — the designated isolation facility for coronavirus patients — the institution did not have ventilators and protective clothing, key towards combating the disease.
The national laboratory plays a crucial role in Zimbabwe’s health delivery system. It is the country’s only approved Covid-19 testing laboratory.
According to the audit report, read by the Independent this week, the laboratory did not have robust accounting mechanisms, opening room for possible manipulation and massive leakage of resources.
Notably, the audit, which also casts light on violations of the Public Finance Management Act, shows fragile accounting systems at the NMRL, among other flaws.
Part of the audit report’s findings read: “The inspection of the NMRL establishment and organogram revealed that the structure did not provide for accounting operations. However, an enquiry with management revealed that the institution was operating two separate bank accounts RTGS-20555480020 and FCA 20555480030, which were opened in 2003 and 2018 respectively.
“An FCA account 20555480030 was opened in October 2018 without Treasury approval. The request to open the account was written and authorised by administration officer and National Laboratory technician without confirmation from the accounting officer.”
In response to these findings, the NMRL, through its chief director (curative services) Sydney Makarawo noted that the accounting irregularities arose from “oversight due to lack of a finance person”, while recommending that the accounts would be regularised in line with Treasury guidelines.
On November 18, 2019, secretary Mahomva was furnished with Makarawo’s responses to the findings of the audit.
The internal audit report, covering the period from 2013 to 2019, also lifts the lid on how the NMRL administration officer was arbitrarily performing multiple tasks against the standard procedure of “segregating” duties. As a result of this, the audit report highlights, “bank reconciliations were not being done”. The administration officer, among a litany of other misdeeds, was also alleged to have disregarded reporting protocols as well as “by-passing and disobeying lawful instructions by his immediate supervisor . . .”
“An inspection of financial transactions shows that the administration officer was receipting, banking, prepaying payment vouchers, effecting payments through online banking, withdrawing cash and was also a signatory to the two bank accounts. As a result, there was no segregation of duties,” read the internal audit report.
“There were no cash books for the two bank accounts being maintained to account for receipts and payments. As a result, bank reconciliations were not being done.”
Coupled to that, the audit report also unearthed that “a logistician (was) stationed at Natpharm and was not part of the NMRL” in direct violation of standard procedures. Authorisation to open a “Zimdollar account 20555480020 was not availed for audit inspection.”
Highlighting gross corporate malfeasance at the NMRL, the audit found that “payments were made without authorisation and supporting documents”.
The audit report reveals: “Some payments made were supported by contracts instead of an invoice showing goods and services rendered. A case in point was a payment of US$4 800 and US$2 915 to Stem Magnetics for laptops in November 2017.
“Provisions worth $2 163.07 were not authorised. The payments were made through PFMS documents 5100006059,5100007510 and 5100007508.”
In response to the audit findings, the NMRL acknowledged the accounting flaws and committed that they “would not happen in the future again”, through a report compiled by Makarawo.
Apart from the accounting flaws, the audit report also shed light on how “official documents which include payment vouchers, purchase orders and quotations were inconsistently date stamped for authenticity”.
The audit found that: “Review of the financial documents and minutes showed that the NMRL management made a resolution on July 14, 2014 to apportion the project funds between institution and staff allowances at a ratio of 60:40. A total amount of US$62 939,50 and RTGS$15 113 was received as user fees and US$61 143 and RTGS$6 138,50 was paid out as allowances to staff during the period under review.
“This showed that 97% and 40,64% of US$ (United States dollar) and RTGS respectively was spent as staff allowance. Audit notes that while the management made the resolution, the institution was failing to pay its creditors to the extent of being sued. At the time of the audit the creditors figure stood at US$98 577,66.”
The explosive audit also found that the national laboratory did not seek the Health ministry’s “legal and technical advice” for purposes of formulating and drafting maintenance contacts. Resultantly, the audit report observes, “some contracts were biased towards the contractors . . .”
The report also offers insights into the rampant abuse of vehicles at the laboratory.“There was no adequate vehicle movement control mechanism in place that formal transport request and authorisation was absent, as a result there was no evidence of authorisation of journeys . . .”
“Audit enquiry with the management revealed that three of the vehicles were taken before 2013 and one in 2018.The vehicle registration numbers are ABD-3321, GHCW-1006, ACO-2654 and ABG 7116.”
With Zimbabwe battling to obtain equipment required to combat Covid-19, the national laboratory will come under the spotlight in the wake of the damning audit report.
When contacted for comment, the NMRL chief director said he could not comment on the issues raised in the report as he was not at work.