Zimbabwe audits 10 parastatals ahead of transformation

Finance Minister Patrick Chinamasa says government has engaged private audit firms to undertake forensic audits of 10 key parastatals targeted for transformation as it seeks to turn around loss-making state owned enterprises.

Zimbabwe has 91 state owned enterprises, many of which are underperforming. At their peak, state enterprises contributed up to 40 percent of the country’s gross domestic product (GDP), but they have been dragged down by legacy debt, corruption and mismanagement.

Addressing a Public Accountants and Auditors conference in Harare today, Chinamasa admitted that government needed the assistance of private audit firms to undertake sound audits, and has already completed the exercise for four of the parastatals.

“There is a lot of slack in our financials and we expect the accountant’s board to play a leading role in highlighting these anomalies. There has been a lot of bad corporate governance in the state owned enterprises,” said Chinamasa.

“We have isolated ten key institutions which, if we successfully turn around, will have a transformative effect on the economy. Out of these, three or four audits have already been completed and we will soon be making them public.”

Asked why government had taken long to reform state enterprises, Chinamasa said “transformation of parastatals has always been a priority, but we did not have the energy or the resources. We were preoccupied with reengagement, but now that our reengagement strategy has been accepted I am convinced this is the hour to take it on.”

Chinamasa said government was also in the process of crafting a corporate governance law which will be applicable to parastatals and local authorities.- The Source

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This post was last modified on April 23, 2016 5:57 am

Charles Rukuni

The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.