Administrative court audit detects misappropriation of nearly two billion Meticais in Covid-19 prevention funds
An audit conducted by the Administrative Court (TA) of Mozambique has revealed a misappropriation of approximately 1.709 billion meticais from state funds allocated in 2021 for the prevention and mitigation of the Covid-19 pandemic.
According to the audit report, there were discrepancies in the financial statements related to the funds disbursed for Covid-19 prevention and mitigation in the fiscal year 2021.
The report, sent to the Government, indicates that the National Institute of Social Action (INAS), the beneficiary and manager of the funds allocated for Covid-19 mitigation, incurred expenses amounting to 1.709 billion meticais without evidence of the contracted services being rendered, constituting a diversion of funds.
The audit also notes that there were improper payments of over 78.6 million meticais and ineligible expenses worth 25 million meticais.
The Administrative Court highlighted several issues, including contracts not submitted for prior inspection valued at over 57.3 million meticais, irregularities in the contracting process totaling more than 100.1 million meticais, and the lack of supporting documents for expenses totaling 11.7 million meticais.
In response to the economic impacts of Covid-19, the Mozambican Government had developed a "needs plan" budgeted at 700 million dollars. This plan included 100 million dollars for prevention and treatment, 200 million dollars for state budget support, 240 million dollars for family transfers, and 160 million dollars for micro-businesses.
Accordingly, the Government requested a loan from the International Monetary Fund in April 2020 and sought support from cooperation partners to cover these needs.
The audit concludes that the deficiencies in the control and management of these funds contributed to material distortions in the Financial Statements, including poor communication regarding the purpose of disbursements made by the Ministry of Economy and Finance, inadequate or non-existent control mechanisms, deficiencies in the organization of file archives and accounting process records.
Furthermore, the audit identified a lack of effective mechanisms to ensure that the selection of goods suppliers and service providers complies with the country's procurement rules. It also noted the need for mechanisms ensuring that contractors comply with technical specifications established in the terms of reference during the construction of public infrastructures.
TORRE
