HON. BITI: Mr. Speaker, there are countries that operate without a Central Bank and without monetary policy, but my real question is – I hear the Minister talk about a surplus each time he opens his mouth. Mr. Speaker, two things to the Hon. Minister. Firstly, you cannot celebrate a cash surplus (cash-at-hand) when international accounting standards are accrual. You cannot say I have $5 in the bank. Yes, I have got surplus but you have not paid school fees. …
THE HON. SPEAKER: What is the question?
HON. BITI: The question is – you cannot celebrate a surplus on a cash basis when debts are accruing every day. So, Hon. Minister, your contention of a surplus is fictitious because you are not using international standards of accrual accounting. Secondly, to the question of the surplus Hon. Speaker, the budget of 2019 was expressed in US$. The accounting of Government from January has been based on the RTGS$ from 20 February, 2019. Are you recording a surplus in US$ terms Hon. Minister?
HON. PROF. M. NCUBE: Again, I thank the Hon. Member for those two, actually its three questions. One; are we using international standards in our accounting procedure; accrual versus accounting standards. Then the surplus, is it fictitious or not? Thirdly, is the surplus; is it in RTGS or US$? Let me go back to the first question. The cash accounting in terms of the budget report is in line with international standards. Those are the facts. What is happening is that there are countries that are beginning to use accrual accounting and what we have started working on is that by 2022, we will move to accrual accounting.
Now, the steps required are as follows; what is required is for us to move towards a four balance sheet accounting, which means we have to value all Government assets and we have started doing that….
THE HON. SPEAKER: Hon. Minister, perhaps in your explanation, if you can simplify the issues so that people can understand what you mean by accrual, otherwise you will be asked the same questions again.
HON. PROF. M. NCUBE: Mr. Speaker, the question as I understood it was not to explain the difference between accrual and cash. The question is on what we are using. At the moment, we are using cash accounting and I can confirm that. Now, as to whether we have got a surplus or not, the answer is yes, we have a surplus in both RTGS and US$. In RTGS currently and cumulatively, it is about RTGS$600 million. If you divide that with the current exchange rate you get about US$$100 million.
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