Chinamasa under fire

4.6.4.1  Given that IDBZ Bank was not a going concern as an entity, the Committee failed to understand why Government was not disbanding it. The Committee recommends that Treasury should by 31st September, 2016, provide an explanation to the Committee why it was maintaining IDBZ given its perennial financial woes.

4.6.4.2   Furthermore, of the institutions highlighted, save for the Registrar General’s Office and ZINARA, all had going concern issues and government should with immediate effect, stop lending funds to non-performing entities.

4.6.4.2 Government should with immediate effect institute recoveries from entities such as ZINARA since it was collecting a lot of revenue.

4.6.5. Governance Issues- Non provision of information for the Zimbabwe Economic Trade Revival Facility (ZETREF)

Under the ZETREF facility, the Zimbabwe government contributed $20 million while Afri-Exim Bank contributed $50 million. Interfin Bank was the implementing agent for the Zimbabwe Government while the Afri-Exim Bank was to administer the $50 million. Interfin Bank went bankrupt before disbursing the loans to beneficiaries and to date the money is yet to be recovered.  The Fund managers failed to avail for audit crucial documents such as the facility agreement with implementing agencies, beneficiaries, bank statements and monitoring reports to enable the Auditor General to verify trade receivables and interest receivables, amounting to $12 699 810 and $566 819 respectively. Failure to avail information results in limitation of scope and financial statements may be materially misstated. The Accountant General informed the Committee that the agreements were between the participating banks and the respective beneficiaries. The banks have those agreements in place.

 4.6.5.1   The Committee called for closer scrutiny of such facility as it has a potential to worsen the debt situation of the country. It therefore, recommends that the Minister of Finance should provide a full report on the status of the facility to the Committee by 31st September, 2016.

4.6.6   Mixing NDF and PSIP in one IDBZ Account

Disbursements made by the Fund to the IDBZ for on-lending to various implementing agents were mixed with Treasury funds intended for PSIP projects in one IDBZ bank account. The Fund managers alleged that IDBZ bank could have assumed that the money came from the same source; the Ministry of Finance and Economic Development. The mixing of the funds makes it difficult to account and report separately for the usage and repayments of those funds. The Accountant General pointed out that the Bank had been instructed to open separate accounts for PSIP and NDF. Evidence would be verified in the next audit.

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