ANNUAL GENERAL REPORT OF THE CONTROLLER AND AUDITOR GENERAL

Transcription

1 ANNUAL GENERAL REPORT OF THE CONTROLLER AND AUDITOR GENERAL On the Audit of the Financial Statements of Donor Funded Projects for the year ended 30 th June, 2012

2 THE UNITED REPUBLIC OF TANZANIA NATIONAL AUDIT OFFICE Office of the Controller and Auditor General, Samora Avenue, P.O. Box 9080, DAR ES SALAAM. Telegram: Ukaguzi", Telephone: 255(022) /8, Fax: 255(022) , Website: Your Excellency Dr. Jakaya M. Kikwete, The President of the United Republic of Tanzania, State House, P.O. Box 9120, Dar es Salaam. Re: Submission of Annual General Report of the Controller and Auditor General on the Financial Statements of Donor Funded Projects for the year ended 30th June, 2012 Pursuant to Article 143(4) of the Constitution of the United Republic of Tanzania of 1977 (revised 2005), and Sec.34 (1) (c) of the Public Audit Act No. 11 of 2008, I hereby submit to you my second General Report on Donor Funded Projects for the year ended 30 th June, I submit. Ludovick S.L. Utouh CONTROLLER AND AUDITOR GENERAL ii

3 List of abbreviations A/C ACGEN ASDP ASDS ASLMs ASP BHSP BoQ BWOs CAATs CAG CCTTFA CDTI CFS CMC CPO DADPs DANIDA DASIP DDPs DHIR PMO- RALG DRTA DSS EAPHLNP ES-FEAT EU HBF HSPS IA IDA IFAD ISA ISSAIs JICA LAFM LART LGAs Account Accountant General Agriculture Sector Development Programme Agricultural Sector Development Strategy Agricultural Sector Lead Ministries African Stockpiles Program Basic Heath Services Project Bills of Quantity Basin Water Offices Computer Assisted Audit Techniques Controller and Auditor General Central Corridor Transit Transport Facilitation Agency Community Development Training Institute Consolidated Financial Statements Community Managment Committee Central Payment Office District Agricultural Development Plans Danish International Development Agency District Agriculture Sector Project District Deveopment Plans District Health Insfrastructure Rehabilitation Dar es Salaam Rapid Transport Agency Diagnostic Service Section East Africa Pblic Health Labortory Networking Project Ethics Secretariat FEAT European Union Health Basket Fund Health Sector Project Support Irish Aid International Development Association International Fund for Agricultural Development International Standards on Auditing International Standards of Supreme Audit Institutions Japan International Cooperation Agency Local Authority Financial Memorandum Loans and Realization Trust Local Government Authorities iii

4 LGSP Local Government Support Project LGTP Local Government Transport Program LSRP Legal Sector Reform Program MDAs Ministries, Departments and Agencies, MDG Milenium Development Goals Marketing Insfrastructure, Value Addtion and Rural MIVARF Finaue Support Progrm MoU Memorandum of Understanding MoW Ministry of Water NAO National Audit Office NBAA National Board of Accountants and Auditors NVF National Village Fund NWSDS National Water Sector Development Strategy OC Other Charges OPD Output Patient Department PAC Public Accounts Committee PE Procuring Entities PFA Public Finance Act (No. 6 of 2001 revised 2004) PFGAs Participatory Farmers Groups Associations PFMRP Public Financial Management Reform Programme PFR Public Finance Regulations PLHIV People Living with HIV PMG Paymaster General PPA Public Procurement Act (No. 21 of 2004) PPRA Public Procurement Regulatory Authority PSCP Private Sector Competitive Project PSRP Public Service Reform Program RAS Regional Administrative Secretariat RCIP Regional Communication Infrastucture Project REA-WBFP Rural Energy Agency World Bank Financed Projects Reg. Regulation RSSP1 Road Sector Support Project RWBO Rufiji Water Basin Organisation RWSSP Rural Water Supply Sanitation Program Sect. Section SIDA Swedish International Development Agency SNAO Swedish National Audit Office TASAF Tanzania Social Action Fund TMU TASAF Management Unit TPRS Tanzania Poverty Reduction Strategy iv

5 TRA URT USD VFC VFJA WSDP Tanzania Revenue Authority United Republic of Tanzania United States Dollars Village Fund Coordinator Village Fund Justification Assistant Water Sector Development Programmme v

6 TABLE OF CONTENTS List of abbreviations... iii Foreword... ix Acknowledgement... xii Executive Summary... 1 CHAPTER ONE BACKGROUND INFORMATION Audit of Donor Funded Projects Functions and Responsibilities of the CAG on the Donor Funded Projects Organisation of audit work at the National Audit Office Scope and Applicable Audit Standards Accounting Policies... 8 CHAPTER TWO.. 11 BASIS OF AUDIT OPINION Introduction Types of Audit Opinion Audit Opinions Issued on Donor Funded Projects CHAPTER THREE FINANCIAL PERFOMANCE OF THE PROJECTS Introduction Water Sector Development Programme Tanzania Social Action Fund (TASAF II) Agriculture Sector Development Programme (ASDP) Health Basket Fund Programme Financing Other Projects CHAPTER FOUR PRESENTATION AND ANALYSIS OF AUDIT RESULTS Introduction Major Donor Funded Projects OTHER DONOR FUNDED PROJECTS CHAPTER FIVE REVIEW OF PROCUREMENT PROCESSES Introduction Agricultural Sector Development Programme (ASDP) Health Basket Fund (HBF) Tanzania Social Action Fund (TASAF) Water Sector Development Programme Other Projects vi

7 CHAPTER SIX WEAKNESSES IN FINANCIAL MANAGEMENT Introduction AGRICULTURE SECTOR DEVELOPMENT PROGRAMME (ASDP) WATER SECTOR DEVELOPMENT PROGRAMME (WSDP) HEALTH BASKET FUNDS (HBF) TANZANIA SOCIAL ACTION FUND (TASAF) GLOBAL FUND AND OTHER PROJECTS CHAPTER SEVEN CONCLUSION AND RECOMMENDATIONS Conclusion Recommendations ANNEXTURES vii

8 Office of the Controller and Auditor General, The National Audit Office, United Republic of Tanzania. (Established under Article 143 of the Constitution of the URT The statutory duties and responsibilities of the Controller and Auditor General are given under Article 143 of the Constitution of the URT of 1977 (revised 2005) and further elaborated in Sect 10(1) of the Public Audit Act No. 11 of Vision To be a centre of excellence in public sector auditing. Mission To provide efficient audit services in order to enhance accountability and value for money in the collection and use of public resources. Core Values In providing quality services, NAO is guided by the following Core Values: Objectivity: We are an impartial organization, offering services to our clients in an objective and unbiased manner; Excellence: We are professionals providing high quality audit services based on best practices; Integrity: We observe and maintain high standards of ethical behaviour and the rule of law; People focus: We focus on stakeholders needs by building a culture of good customer care and having competent and motivated work force; Innovation: We are a creative organization that constantly promotes a culture of developing and accepting new ideas from inside and outside the organization; and Best resource utilisation: We are an organisation that values and uses public resources entrusted to it in efficient, economic and effective manner. We do this by:- Contributing to better stewardship of public funds by ensuring that our clients are accountable for the resources entrusted to them; Helping to improve the quality of public services by supporting innovation on the use of public resources; Providing technical advice to our clients on operational gaps in their operating systems; Systematically involving our clients in the audit process and audit cycles; and Providing audit staff with adequate working tools and facilities that promote independence. This audit report is intended to be used by Government Authorities. However, upon receipt of the report by the Speaker and once tabled in Parliament, the report becomes a matter of public record and its distribution may not be limited. viii

9 Foreword This general report is a summary of results on the audit of Donor Funded Projects financed by Development Partners and The United Republic of Tanzania. The projects are categorized in two categories i.e major four projects and the other projects as listed below: First category of major projects funded through Basket Funding arrangement are as follows:- Tanzania Social Action Fund (TASAF), Agricultural Sector Development Programme (ASDP), Water Sector Development Programme (WSDP) Health Basket Fund (HBF). Second category of other projects funded through bilateral funding arrangements Apart from the audit of projects which are funded through Basket funding arrangement, I also covered other projects which are financed through bilateral arrangements. The general report for Donor Funded Projects is being prepared and submitted to the President of the URT in accordance with Article 143 of the Constitution of the United Republic of Tanzania of 1977 (revised 2005) and Section 34(1) & (2) of the Public Audit Act No. 11 of Pursuant to Article 143(2) (c) of the Constitution of the URT of 1977 (revised 2005), the Controller and Auditor General, shall at least once every year audit and give an audit report in respect of the accounts of the Government of the United Republic, the accounts managed by all officers of the Government of the United Republic, the accounts of all Courts of the United Republic and the accounts managed by the Clerk of the National Assembly. Under Article 143(4) of the Constitution of the URT, the Controller and Auditor General is required to submit to the President of the URT every report he makes pursuant to the provisions of sub Article (2) of the same Article. Upon receipt of such reports, the President shall direct the persons concerned to submit these reports before the first sitting of the National Assembly preferably ix

10 before the expiration of seven days from the day the sitting of the National Assembly began. The enactment of the Public Audit Act No. 11 of 2008 enhanced the operational independence of my office in the fulfillment of my Constitutional mandate. This was a result of the efforts of his Excellency the President of the United Republic of Tanzania Dk. Jakaya Mrisho Kikwete. The operational independence of my office is expected to enable me acquire the necessary control over all the resources available for the office including human and financial resources, which will enable my office to perform its tasks without being under any undue influence and control of any person or authority. It is worth noting that while my office reports on non compliance with various laws, rules and regulations and on weaknesses in internal control systems across the public sector entities and in particular the Donor Funded Projects, the ultimate responsibility for the maintenance of an effective and adequate system of internal control and a compliant framework lies with each Accounting Officer. Parliament and the Tanzanian public looks upon the Controller and Auditor General and the National Audit Office (NAO) for assurance in regard to financial reporting and public resources management in the Public Sector and in relation to the efficiency and effectiveness of programs administration. My office contributes through recommendations given towards improvements in the public sector performance. In this regard, the Government, Development Partners and my office each have a role to play in contributing to Parliamentary and public confidence building in public resources management. However, while the roles of public sector entities and NAO may differ, the desire for efficient utilization of public resources remains a common ground. In order to meet the Parliamentarian and the public s expectations, NAO continually reviews its audit approaches to ensure that the audit coverage provides an effective and independent review of the performance and accountability of x

11 public sector entities which are recipients of funds from Development Partners. Moreover, we wish to ensure that our audit coverage is well targeted and addresses priority areas so as to maximize our contribution in improving public financial management. Since our work acts as a catalyst in improving financial management, we continue discussing with our auditees on contemporary issues and developments that impact on public sector management, particularly financial reporting and good governance. I hope that the National Assembly, the Development Partners and the public in general will find the information in this report useful in holding the Accounting Officers to account for their stewardship role of Donor funds and their delivery of improved public services to Tanzanians which they are serving. In this regard, I will appreciate to receive feedback from the users of this report on how to further improve it in the future. Ludovick S.L. Utouh CONTROLLER AND AUDITOR GENERAL National Audit Office, Dar es Salaam. March, 2013 xi

12 Acknowledgement I would like to express my gratitude to those who created an enabling environment for me to discharge my Constitutional obligations. My sincere appreciation is extended to all our stakeholders including the Paymaster General, the Treasury and all Accounting Officers in the respective MDAS and LGAs who are managing and supervising the Donor Funded Projects financed in MDAs and LGAs for the much needed support, cooperation and for providing vital information needed for the preparation of this Annual General Report. Also, I would like to thank all the public servants throughout Tanzania mainland, whether in Central or Local Governments without forgetting the role of taxpayers and Development Partners to whom this report is dedicated. Their invaluable contributions in building the nation cannot be underestimated. I would like to acknowledge the professionalism and commitment of my staff in achieving our goals and undertaking the work associated with meeting our ambitious audit programs despite the fact that they have been working in very difficult conditions marked with insufficient funding, working tools, low salaries and sometimes working in very remote locations which are not easily accessible. Furthermore, I would like to express my thanks to members of my staff for their endeavors to once again enable me discharge my statutory responsibilities. With lots of appreciation, I am obliged to pay tribute to my family and the families of my staff members for their tolerance during our long absence from them in fulfilling these Constitutional obligations. Lastly, I would also like to thank the Printer for expediting the printing of this report for its timely submission on the statutory due date. May the almighty God bless you all as we commit ourselves to promote accountability and good governance on the use of the public resources of the country. xii

13 Executive Summary This year s Annual General Report for Donor Funded Projects is the second report and dwells on the following:- A. Background and General Information B. Basis of Audit Opinion C. Financial Performance of the projects D. Presentations and Analysis of Audit results E. Procurement Irregularities F. Financial Management G. Conclusion and Recommendations A: Background and General Information This part of the report gives a summary of the final results of the audit of the financial statements of Donor Funded Projects for the year ended 30 th June, The scope of audit in the Donor Funded Projects comprises: Water Sector Development Programme (WSDP), Agricultural Sector Development Programme (ASDP), Tanzania Social Action Fund (TASAF), Health Basket Fund (HBF) and other Donor Funded Projects. B: Basis of Audit Opinion The outcome of the audits of Donor Funded Projects for the year under review is as shown in the Table I below:- Table 1: Audit Opinion Summary Project Unqualifie d without emphasis of matter Unqualifi ed With Emphasis of Matter Qualifi ed Adver se Disclai mer Tota l TASAF ASDP WSDP HBF Sub total Other project Grand Total

14 C: Performance Report on Major Projects and Others This section gives highlights of performance report of major projects and others including sources of financing, expenditure details and unspent balances at the end of the year. There is a chapter on performance of major Donor Funded Projects in order to evaluate whether funds appropriated to the projects were exclusively spent for the intended purposes; their contribution to the economy and social development of this country, including challenges encountered; and whether value for money was realized. D: Presentations and Analysis of Audit Results This chapter gives analysis of the reasons which gave rise to issuance of a particular type of opinion to a Donor Funded Project. The analysis is aimed at amplifying the basic criteria used in forming the opinions as discussed in the preceding chapter. A total of 4 major Donor Funded Projects were audited in the financial year 2011/2012 constituting a total of 523 audit reports whereas 93 other Donor Funded Projects were also audited making a total of 616 Donor Funded Projects audit reports. E: Procurement Irregularities In the individual management letters submitted to each Accounting Officer, I have made a statement that almost all major Donor Funded Projects did not fully comply with the procurement laws as required by the Public Procurement Act No. 21 of 2004 and its related Regulations of My concern is on the level of understanding of the requirements of the country s procurement laws and regulations. F: Financial Management This chapter aims at providing information on the matters from the previous audit recommendations which had been issued separately to each individual accounting officer, funding analysis and current key audit findings. 2

15 G: Conclusion and Recommendations Finally, as per the mandate vested in me under Sect.10 of the Public Audit Act No. 11 of 2008, I have made a number of recommendations in Chapter Seven of this report, of which if implemented I believe will contribute in improving the management of Donor Funded Projects in our country. The conclusion and recommendations include the following among others: Accounting Officers do not adequately manage or supervise projects and in particular, address and implement audit recommendations. There are previous year s recommendations which remained unattended amounting to Shs. 20,289,040,011 as at the report date. There is a serious problem of non compliance with the requirements of MoUs which insists on adherence with the financial and procurement laws of Tanzania. During the year under review, we observed anomalies amounting to Shs.39,461,168,319 and Shs.5,036,540,269 in respect of procurement and financial management respectively. The Ministry of Finance should be strengthened and imposed stricter financial control on Accounting Officers and improve accounting of Government expenditures including Donor Funded projects. In addition, the Ministry has to ensure that all Accounting Officers prepare financial statements of the Donor funded projects under them and submit them for audit on time. There has been remarkable delay in release of funds from Development Partners and Treasury to project implementing partners. This has contributed in delay or non implementation of earmarked projects and also resulting in huge amounts of unspent balances at the end of the financial year amounting to Shs. 299,852,509,319, and USD 213,520,573 as at 30 th June,

16 Development Partners, the Ministry of Finance (Treasury) and PMO RALG should ensure timely release of funds earmarked for implementation of project activities to avoid delays in the fulfillment of projects objectives which in most cases results to have huge unspent project fund at year end and higher costs due to inflation. 4

17 CHAPTER ONE 1.0 BACKGROUND INFORMATION This report is issued following the comprehensive audit of the accounts and underlying documents of Donor Funded Projects pursuant to Article 143 (4) of the Constitution of the United Republic of Tanzania of 1977 (revised 2005) for the financial year 2011/2012. In 2010/2011, I issued the first general report on Donor Funded Projects together with the management letters and audit reports to each Accounting Officer separately. Therefore, outstanding matters in this report refer to the audited reports that were issued to the individual project Accounting Officers. 1.1 Audit of Donor Funded Projects I am required by Article 143 of the Constitution of the URT to audit the Public Accounts and all offices, Courts and authorities of the Government of Tanzania and Donor Funded Projects and submit my reports thereon to the President who shall cause them to be laid before Parliament. In discharging these duties, I am required in terms of Section 10 of the Public Audit Act No. 11 of 2008, to satisfy myself that:- All reasonable precautions have been taken to safeguard the collection of public money and that the law, directives or instructions relating thereto have been duly observed. All money disbursed have been expended and applied under proper authority and for the purpose intended by such authority and, adequate regulations exist for the guidance of storekeepers and stores accounts and that they have been duly observed. In addition, I have the duty, by virtue of the same Section to draw the attention of the Parliament to any apparent lack of economy in the expenditure or use of public money or stores. 5

18 1.2 Functions and Responsibilities of the CAG on the Donor Funded Projects My responsibility as an Auditor is to express an opinion on the financial Statements of Donor Funded projects based on my audit. I conducted my audit in accordance with the International Standards of Supreme Audit Institutions (ISSAIs) and such other procedures I considered necessary in the circumstances. In addition, Sect. 10 (2) of the PAA No. 11 of 2008 requires me to satisfy myself that the accounts have been prepared in accordance with the appropriate accounting standards and that reasonable precautions have been taken to safeguard the collection of revenue, receipt, custody, disposal, issue and proper use of public property, and that the law, directions and instructions applicable thereto have been duly observed and expenditures of public money have been properly authorized. Further, Sect 44(2) of the Public Procurement Act No.21 of 2004 and Reg. No. 31 of the Public Procurement (Goods, Works, Non-consultant services and Disposal of Public Assets by Tender) Regulations of 2005 requires me to state in my annual audit report whether or not the auditee has complied with the provisions of the Law and its Regulations. 1.3 Organisation of audit work at the National Audit Office The report provides a summary of the final results of the audit exercise, which was carried out by my office throughout the country in the course of the year under review. In order for my office to effectively handle this enormous task of auditing all the Donor Funded Projects in the country, it has established offices in the regions in Tanzania mainland for administrative purposes. Audit Staff It is worth noting the Government s efforts in improving the welfare of my staff, although there is a need for further improvement. A new organization structure for my office was recently approved by His Excellency Dr. Jakaya 6

19 Mrisho Kikwete the President of the United Republic of Tanzania. I have also submitted a proposal of enhanced salary package for my office to the President s Office Public Service Management. In the meantime, the audit scope has expanded considerably. There is an intention of expanding our coverage up to the district level. These efforts would require the approval of the Government and for it to set aside a budgetary provision to cater for this expansion. In keeping with current trends, the audit work is no longer confined to financial and compliance auditing. It is my intention to ensure that my audit staff are trained in performance, forensic, environmental,contract auditing, gender based auditing, management auditing, risk based auditing and Information Technology (Computer Assisted Audit Techniques CAATs) in order to be able to perform what is commonly referred to as comprehensive audit which encompasses the audit of every aspect in an organization.with the recent discovery of gas reserves and the possibility of discovery of oil reserves,it is the intension of my office to build the capacity of my auditors to audit on this area. 1.4 Scope and Applicable Audit Standards Scope of Audit The scope of audit covered on risk and materiality basis, proper expenditure and authorization, performance of Donor Funded Projects and physical verification. Audits were performed to satisfy myself as to the compliance with established Regulations, the exercise of economy, efficiency and effectiveness in the utilization of public resources. In addition, audit was performed to highlight irregularities, although not exhaustively, that have been reported on in some detail not only through regular inspection reports, but more emphatically through reference sheets to spotlight areas of serious concerns on proper accountability and need for stringent administration of public resources. 7

20 In the course of the audit, the findings are brought to the attention of the Accounting Officers of Donor Funded Projects being audited through an exit meeting. Accounting Officers are given an opportunity to respond to my observations, recommendations and related commentary, after which the Accounting Officers are issued with the audit report, signed by the Controller and Auditor General containing the audit opinion. A management letter signed by the Assistant Auditor General is also issued separately Applicable Auditing Standards I conducted my audit in accordance with the International Standards of Supreme Audit Institutions (ISSAIs) issued by the International Federation of Accountants (IFAC) in which Tanzania is a member through the National Board of Accountants and Auditors (NBAA) and such other procedures I considered necessary in the circumstances. These standards require that I comply with ethical requirements of planning and performing of the audit to obtain reasonable assurance of whether the financial statements are free from material misstatements. 1.5 Accounting Policies Financial statements of the DFPs are prepared according to the MoU requirements; although they all observe the Public Financial Management Systems of this country. Reg.53 of the Public Finance Regulations of 2001 (revised 2004) states that the accounting policies of the Government are so framed to ensure that the resources appropriated by Parliament are properly accounted for. In terms of the Public Finance Act No. 6 of 2001 (revised 2004) all revenues received by the Government shall be deposited into the Consolidated Fund. Payments out of the Consolidated Fund will be made through appropriations by Parliament. 8

21 1.6 Preparation and Submission of Financial Statements for Audit Responsibilities of the Accounting Officer - Central Government Sect. 25(4) of the Public Finance Act (PFA) No. 6 of 2001 (revised 2004), places responsibility on the Accounting Officer to prepare financial statements for each financial year which give a true and fair view of the receipts and payments made under the project as at the end of the financial year. It also requires management to ensure that the project management keeps proper accounting records which will disclose with reasonable accuracy its financial position and its responsibility in safeguarding the assets of the reporting entity Management Responsibilities to the Financial Statement - Local Government Financed Projects Where the Local Government Authority receives funds from the Development Partners, preparation of the financial statements is the responsibility of the Council s management as per Order No. 25(1) of the Local Authorities Financial Memorandum of 2009 and as per the signed Memorandum of Understanding between the Local Government Authorities and Development Partners. Order Nos.11 to 14 of the Local Authorities Financial Memorandum (LAFM) of 2009 requires the management to establish and support a sound system of internal control within the Council. In addition, Order No. 25(1) places responsibility on the Council s management to prepare the financial statements of Donor Funded Projects in accordance with the laws, regulations, directives issued by the Minister responsible for Local Governments, the Local Government Financial Memorandum; the International Public Sector Accounting Standards (IPSASs) and the MOU. 1.7 Internal Control Systems Internal Control System refers to all means by which Government resources are directed, monitored, and measured. Internal controls play an important role in 9

22 preventing and detecting frauds/misappropriations and protecting the public resources, both tangible and intangible. Implementing an effective internal control structure is an essential responsibility of the management of the entity. 10

23 CHAPTER TWO BASIS OF AUDIT OPINION 2.0 Introduction The auditor's opinion is a formal opinion, or disclaimer thereof, issued by an independent external auditor as a result of an audit on the financial statements or evaluation performed on an entity or subdivision thereof (called an auditee ). The opinion is provided to the user of these financial statements as an assurance service in order for the user to make decisions based on the results of the audit. An auditor s opinion is considered an essential tool when reporting financial information to users. In the public sector, it is intended to advise Parliament and other users on whether Donor Funded Project s financial statements have been prepared in conformity with the International Public Sector Accounting Standards (IPSAS) and in the manner required by Sect. 25(4) of the Public Finance Act, 2001 (revised 2004) and Order Nos. 11 to 14 of the Local Authorities Financial Memorandum (LAFM) of 2009 including the Donor Funded Project s MoUs compliance with laws and regulations. In ordinary language, the opinion is an assurance on whether the financial information presented by the auditee is materially correct and trustworthy for making various decisions such as the Government s decision on whether the allocations made to Donor Funded Projects have been spent for the benefit of the citizens. It is important to note that the auditor s opinion on the financial statements is on whether the information presented is correct and free of material misstatements, whereas all other determinations are left for the user to decide. 11

24 2.1 Types of Audit Opinion There are five common types of auditor s opinions, each one presenting a different situation encountered during the auditor s work. The five opinions are as follows: (i) Unqualified Opinion Unqualified Opinion is sometimes regarded by many as equivalent to Clean audit opinion. This type of opinion is issued when the financial statements presented are free of material misstatements and are in conformity with the International Public Sector Accounting Standards (IPSAS) including compliance with laws and regulations. It is the best type of an audit opinion an auditee may receive from an external auditor. (ii) Unqualified Opinion with Emphasis of Matter In certain circumstances, the audit opinion may be modified by adding an emphasis of matter paragraph to highlight a matter(s) affecting the financial statements. The addition of such an emphasis of matter paragraph does not affect the audit opinion.fthe main objective of the emphasis of matter paragraph is to bring closer understanding of the situation obtained in the audited entity, despite the unqualified opinion given. (iii) Qualified Opinion The nature of the circumstances giving rise to qualification will generally fall into one or two categories. Where there is an uncertainty which prevents the auditor from forming an opinion on a matter (Uncertainty). Where the auditor is able to form an opinion on a matter but this opinion conflicts with the view given by the financial statements (Disagreement in best practice or records keeping and non compliance with Laws and Regulations). 12

25 (iv) Adverse Opinion An Adverse Opinion is issued when it is determined that the financial statements are materially misstated and, when considered as a whole, do not conform to the International Public Sector Accounting Standards (IPSAS), cash and accrual basis of accounting, essentially stating that the information contained is materially incorrect, unreliable, and inaccurate in order to assess the results of operations. The wording of the adverse opinion is clear in which I state that the financial statements are not in accordance with the International Public Sector Accounting Standards (IPSAS). (v) Disclaimer of Opinion A Disclaimer of Opinion, commonly referred to simply as a Disclaimer, is issued when I could not form, and consequently refuses to present, an opinion on the financial statements. This type of opinion is expressed when I tried to audit but could not complete the work due to various reasons and therefore I do not issue an opinion. Certain situations where a disclaimer of opinion may be appropriate includes: a lack of independence, or, when there are significant scope limitations, whether intentional or not, or when the auditee refuses to provide evidence and information to me in significant areas of the financial statements and when there are significant uncertainties within the auditee. 2.2 Audit Opinions Issued on Donor Funded Projects The following table presents the types of audit opinions issued to Donor Funded Projects for the financial year 2011/2012: 13

26 Project Table 2: Audit Opinions Issued Unquali fied without emphas is of matter Unqualifi ed With Emphasis of Matter Quali fied Adver se Disclai mer Total TASAF ASDP WSDP HBF Sub total Other project Grand Total Opinion 2011/ % 2010/ % Unqualified without emphasis of matter Unqualified with emphasis of matter Qualified Adverse Disclaimer Total From the table above, it can be analysed in a pie chart as follows: 14

27 15

28 16

29 17

30 3.0 Introduction CHAPTER THREE FINANCIAL PERFOMANCE OF THE PROJECTS This chapter gives a detailed analysis of the portfolio of financial performance of WSDP, TASAF, ASDP, HBF and other audited Donor Funded Projects for the financial year 2011/2012. These projects have been financed by the Government of Tanzania and various Development Partners whose financial contribution and implementation status are presented below: 3.1 Water Sector Development Programme Financial Performance of the Water Sector Basket Fund (a) Holding Account The Government of the United Republic of Tanzania and the Development Partners committed to contribute to the Water Sector Basket Fund Holding Account. During the financial year 2011/2012, there was a total sum of USD. 67,279, in which USD.52,571, was received during the year while USD.14,707, was in respect of the opening balance. Funds transferred during the year was USD.37,544, in which USD.36,581, was transferred to the Ministry of Water and Irrigation and USD.963, was transferred to the Ministry of Health and Social Welfare leaving unspent balance of USD.29,734,919 as at 30 th June, 2012 as shown in Table 3 below: Table 3: Financial performance Details Amount (USD) 2011/2012 Opening balance 14,707, KFW 10,822, IDA 31,510, DFID 9,702, Ministry of Water 536, Total funds Available 67,279,

31 Less Transfers Ministry of Water and Irrigation 36,581, Ministry of Health and Social 963, Welfare Total transfers 37,544, Closing Balance 29,734, (b) Financing of the Water Sector Development Programme During the year under review the Government of Tanzania and Development Partners released Shs. 235,655,721,544 for WSDP projects. In addition, there was an opening balance of Shs. 24,578,395, together with outstanding advances of Sh.47,329,118,931 which in total made Shs. 307,563,235,875 available for use in implementing various WSDP activities in the country. The WSDP financing for the financial year 2011/2012 is as shown in Table 4 and 5 below: Table 4: Source of Funds for WSDP 2011/2012 Donor/Government Amount (Shs) GoT Contributions 26,082,467,232 DPs Contribution to Basket F und 181,264,362,674 DPs Contribution to Earmarked 28,495,778,731 Projects Other sources-community Contribution 2,152,981,712 Adjustment: Gain/(Loss) due to Exchange rate fluctuations (2,339,868,805) Total Contribution/released 235,655,721,544 Add: 24,578,395,401 Opening balance as on 1/7/2011 Outstanding Advances 47,329,118,931 Total fund available during the year 307,563,235,875 19

32 Table 5: Funds Contributed by DPs to WSDP under Basket arrangement 2011/2012 Name of Development Amount ( Shs.) Partner IDA 49,169,068, Germany (KfW) 20,782,467, AfDB 79,123,840, Royal Netherland Embassy 17,150,886, DFID 15,038,100, TOTAL 181,264,362, Funds Utilization Review of the Statement of Receipts and Payments noted that during the year under review, the WSDP had total funds available of Shs. 307,563,235,875 while total expenditure was Shs. 148,926,145,182 resulting to a closing balance of Shs. 158,637,090,693 as reflected in Table 6 below: 20

33 Table 6: Receipts and Payments 2011/2012 Description Amount (Shs.) Amount (Shs.) Amount of Funds Available 307,563,235,875 Expenditure Components wise Water Resources 5,674,821,444 Management Rural Water and 33,607,138,606 Sanitation Services Urban Water and Sanitation Services 100,625,494,220 Water Sector Institutional Strengthening and Capacity Building 9,018,693, ,926,145,182 Closing balance as at 30 th June, ,637,090,693 Further, it was noted that during the financial year 2011/2012, 131 Councils had total funds available amounting to Shs 88,303,090,628 to implement WSDP activities in the Councils. However, as at 30 th June, 2012 the Councils closed accounts with an unspent amount of Shs.64,556,055,033 equal to 73% of the amount available. Details are as shown in Annexure I. 3.2 Tanzania Social Action Fund (TASAF II) Project Financing The TASAF II project life span is four (4) years starting from the year 2005/2006 and is financed by the World Bank through the International Development Association (IDA) and the Government of the United Republic of Tanzania (GoT). The DFA was signed between the GoT and IDA on 19 th January, The total TASAF II IDA funding is USD million comprising of USD million credit and USD 21.0 million grant. A total sum of Shs 55,701,277, which includes Shs. 14,848,919, being opening balance from previous year was received from various sources during the year under review. However, up to 30 th June 2012 there was unspent balance of Shs. 12,815,934,

34 indicating that Shs 42,885,343, was spent as shown in Table 7 below: Table 7: Source and Utilization of Funds for TASAF Receipts from Amount (Shs) 2011/2012 Amount (Shs) 2010/2011 Opening balance 14,848,919, ,471,221, IDA 39, ,648,178, Government 0 Contribution 0 Others 1,564,073, ,981,100, Total receipts for the 83,100,501, year 55,701,277, Total expenditure 42,885,343, ,251,581, Closing balance 1/7/ ,815,934, ,848,919, Funds Released to LGAs Total funds available in the LGAs during the year amounted to Shs. 39,915,181,983 which included an opening balance of Shs.6,376,697,957 being unspent monies during the year 2011/2012. However as at 30 th June, 2012 the Councils closed accounts with unspent amount of Shs.5,807,528,697 equal to 14% of the amount available. The huge closing balance was caused by various Councils failing to implement projects as planned. (Refer Annexure II). Table 8: Source of Funds for TASAF Details Amount (Shs.) 2010/2011 Opening balance 6,376,697,957 Amount received 33,538,484,026 Funds available during the year 39,915,181,983 Amount spent 34,107,653,286 Balance as at 30 th June,2012 5,807,528,697 In addition, a sum of TZS 39,288,285, (equivalent to USD 24,252,028.16) was requested during the year as part of the Additional Financing I and II (USD 30.0 million and USD 35.0 million respectively) for addressing food insecurity in selected 22

35 LGAs that were experiencing severe food insecurity due to persistent drought and to supplement efforts of completing uncompleted subprojects and making them functional. Further funding of TZS 1,564,073, (Equivalent to USD 965,477.26) from OPEC II was requested and received for Mtwara and Lindi regions to finance various projects. 3.3 Agriculture Sector Development Programme (ASDP) Introduction The programme presents an integration of the ASDP National and Local components into one consolidated set of interventions to be financed through the ASDP Basket Fund. This program supersedes the ASSP and DADP. The Government of Tanzania has adopted an Agricultural Sector Development Strategy (ASDS) which sets the framework for achieving the sector s objectives and targets. An Agricultural Sector Development Programme (ASDP) Framework and Process Document, developed jointly by the five Agricultural Sector Lead Ministries (ASLMs), provides the overall framework and processes for implementing the ASDS. Development activities at national level are to be based on the strategic plans of the line Ministries while activities at District level are to be implemented by Local Government Authorities (LGAs), based on District Agricultural Development Plans (DADPs). The DADPs are part of the broader District Agriculture Development Plans (DADPs) ASDP Basket Fund Holding Account Maintained at the Treasury The Agricultural Sector Development Programme Basket Fund (ASDP) is financed by contributions and loans from Development Partners through the embassy of Ireland, Japan, the European Union, International Development Association, and IFAD. During the year under review, the Programme received a total of USD. 60,487, from the development partners and there was an opening balance of USD 12,095, from the previous year, resulting into total funds available for the year USD. 72,583, On the other hand, the transfers from programme holding account amounted to USD.57,780,498.22, leaving USD 23

36 14,803, as closing balance at the end of the year as detailed in the Table 8 below: I am highly concerned with unspent balance from implementing agencies USD 1,011, and funds not transferred to project at the end of the year USD. 14,803, which in our view has caused project planned activities not implemented. Table 9: Holding Account financing Description 2011/12 Account No : Amount (USD) Opening Balance 12,095, IDA World Bank 41,222, IFAD Loan 18,253, Embassy of Ireland - Embassy of Japan - Unspent balance from Project 1,011, Fund available 72,583, Transfers Ministry of AFS&C 9,819, Local Government Authorities 44,652, Min. of Livestock and Fisheries 2,675, Prime Ministers Office RALG 184, Min. of Industries Trade and Marketing 447, Ministry of Water and Irrigation Bagamoyo Total transfers 57,780, Closing balance 14,803, Funds transferred to the ministries listed above were mainstreamed in the Development Vote of the respective ministries and audited accordingly Fund transferred close to the end of the financial year USD 863, I noted that on 25 th June 2012 five days before closing date of the financial year, the Ministry of Finance transferred a total amount of USD 863, equivalent to Shs 1,367,983, to the implementing agencies vide letter with reference number 24

37 EB/AG/20/03/VOL.V/70 for implementation of approved activities under the Agriculture Sector Development Programme (ASDP). However, there were no justifications to substantiate delays in releasing funds to respective implementers keeping into consideration that all unspent balances at the end of the financial year are supposed to be surrendered to the holding account. Overall transfer of funds for the year 2011/2012 was USD.57,780, being 20 per cent lower ( a decrease of USD14,375,699.85) compared with total transfer of USD.72,156, in financial year 2010/2011. This decrease has negative impact on implementation of the earmarked activities in the year Agriculture Sector Development Programme (ASDP) Local Government Authorities Financing The Agriculture Sector Development Programme in LGAs for the financial year 2011/2012 had total funds available of Shs106,781,540, which included Shs. 27,326,841, being the balance brought forward from the previous year for ASDP activities. Detailed analysis for each Council is explained in annexure III. As at 30 th June, 2012, there was an unspent balance of Shs.32,237,919, indicating that Councils managed to spend Shs.74,543,621, equivalent to per cent of the total funds available as shown in Table 10 below: Table 10: Source of Funds for ASDP 2011/2012 Details Amount (Shs.) Opening balance 27,326,841, Amount received 79,454,699, Funds available during the year 106,781,540, Amount spent 74,543,621, Balance as at 30 th June, ,237,919,

38 3.3.5 Agriculture Sector Development Programme (ASDP) Prime Minister s Office Local Government Authorities Financing PMO RALG had total funds available for ASDP during the financial year of Shs 300,000,000. As at 30 th, June, 2012 there was an unspent balance of Shs. 4, indicating that the project spent Shs. 299,995, equivalent to 100% of available funds as can be elaborated in Table 11 below: Table 11: PMO-RALG Financing in 2011/2012 Details Amount (Shs) Opening balance as at 01/07/ Add: Funds received during the year: 300,000, Total funds available during the 300,000, financial year Less: Total Expenditure for 299,995, /2012 Balance carried down as at 4, /06/ Health Basket Fund Programme Financing Introduction Donors finance the Health Basket funds into a Holding Account at the Bank of Tanzania and thereafter channel these funds to the Ministry of Health and Social Welfare (MoH&SW), PMO RALG and LGAs on a quarterly basis through the Exchequer Account. The funding follows the normal GoT system whereby donors financial commitments are included as part of the annual budget of the respective entity. Accordingly, Health Basket Funds are not maintained in a separate account but commingled in Development Account for ministries and Account Number 6 in the Councils, which is also used for health funds from other sources Financing of Health Basket Financing Fund (HBFF) The source of funds for the Health Basket Financing is contributions from Development Partners. During the year under review, the Programme received a sum of USD 104,121, from the Development Partners as shown in the table below and USD 386, was surrendered by MH&SW. There was an opening balance of USD 3,806, thus making total funds 26

39 available for the year to be USD 108,314, Funds for the Programme are deposited in the HBFF deposit Dollar Account maintained at the Bank of Tanzania under the supervision of the Accountant General as shown in Table 12 below: Table 12: Source of Funds for HBF 2011/2012 Amount ( USD) Development Partners UNDP 600, Danish Embassy 17,942, Ireland 8,810, Nertherlands 20,694, CIDA 24,492, KFW 9,430, Switzerland 3,244, UNICEF 1,000, Norway 5,216, IDA 10,000, Sub-total from development partners 104,121, Unspent Balance for Financial year 2010/ , Opening balance 01 July ,806, Grand total 108,314, Transfer of Funds to Beneficiaries amounting to - USD 106,152, During the year under review, a sum of USD 106,152, was transferred to various beneficiaries leaving a closing balance of USD 2,161,094.9 as at 30 th June 2012 as shown in Table 13 below: Table 13: Transfers of Funds to Beneficiaries Receipts Amount (USD) 2011/2012 Amount (USD) 2010/2011 Unspent Balance for Financial 3,227, year 2010/ , Opening balance 01 July ,806, ,228, UNDP 600,000,00 1,450,

40 Danish Embassy 17,942, ,189, Ireland 8,810, Nertherlands 23,384, ,879, CIDA 24,492, ,506, KFW 9,430, Switzerland 3,244, ,051, UNICEF 1,000, ,500, Norway 5,216, ,333, IDA 10,000, ,000, Total receipts 108,314, ,382, TRANSFERS Ministry of Health & Social 38,708, Welfare 52,414, Local Government Authorities 53,297, ,630, PMO-RALG 441, , Total transfers 106,152, ,804, Closing balance 2,610, , Ministry of Health and Social Welfare Programme Financing Donors are depositing funds into Basket funds holding account at the Bank of Tanzania and thereafter the financing is channeled to the Ministry of Health and Social Welfare (MOHSW) on a quarterly basis through the Exchequer system. The funding to the Ministry follows the normal GoT financial management system whereby donors financial commitments are included as part of the Ministry s annual budget. Funds from the Basket are released to MOHSW on a quarterly basis in the normal Government Exchequer Issues System after obtaining approval from the Basket Financing Committee. Basket Funds are therefore managed as part of GOT resources and accounted for as part of MOHSW voted expenditure. Accordingly, Basket Funds are not maintained in a separate account but commingled in the Development Account, which is also used for funds from other Development sources. 28

41 During the year ended 30 th June, 2012 the Ministry received a total sum of Shs 71,043,000,000. Actual Expenditure incurred during the year amounted to Shs.70,081,984,500 Leaving a unspent balance of Shs.1,024,015, 500 as at 30 th June, 2012 of which Shs.700,000,000 was transferred to Deposit Account and Shs.324,015,500 was transferred to Holding Account at BOT as shown in Table 14 below: Table 14: Source of Funds for HBF MoHSW -2011/2012 Details Amount (Shs.) Received during the year 71,043,000,000 Expenditure 70,081,984,500 Unspent balance 1,024,015, 500 transferred to deposit Account 700,000,000 Transferred to the Holding Account 324,015, PMO-RALG The Health Sector Program Support (HSPS) is financed by Ireland, Netherland, Norway, Germany and World Bank, Swiss Agency for Development and Cooperation. During the year under review, the programme received a total of Shs. 687,000,000. According to the statement of receipts and payments the PMO RALG had total funds available for HSPS during the financial year of Shs 913,514, including opening balance of Shs 226,514, However, as at 30 th, June, 2012 there was an unspent balance of Shs.512,637, equivalent to 56% indicating that the project spent only Shs 400,877, equivalent to 44% as per details shown in Table 15 below: 29

42 Table 15: Source of Funds for HBF PMO-RALG Details Amount (Shs) Opening balance as at 01/07/ ,514, Add: Funds received during the year 687,000,000,00 Total funds available during the financial year 913,514, Less: Total Expenditure for 2011/ ,877, Balance carried down as at 30/06/ ,637, Local Government Authorities During the year under review, the LGAs financial performance was as reflected in Table 16 below and detailed analysis as shown in Annexure IV. Table 16: Sources of Funds for HBF LGAs 2011/2012 Details Amount (Shs.) Opening balance at 1/7/2011 8,782,526,242 Add: Funds received during 80,435,231,856 the year Total funds available during 88,805,785,681 the year Less: Total expenditure 76,812,025,208 Balance carried down 30/6/ ,313,520, Other Projects Global Fund Global Fund Accounts Maintained at the Treasury During the financial year under review, the Ministry of Finance received a total of USD 102,798,691 which is equivalent to Shs. 161,933,708, from Global Fund, 30

43 out of this an amount of Shs. 155,925,146, was disbursed to the Ministry of Health and Social Welfare (MoHSW), Shs. 5,438,151, to Tanzania Commission for AIDS (TACAIDS) and Shs. 570,410, to Prime Minister s Office Regional Administration and Local Government as reflected in Table 17 below:- Table 17: 2011/2012 Details Receipts and Disbursement of Global Fund- Amount (Shs) Amount released by Global Fund to Treasury 161,933,708, Transfer To: MoHSW 155,925,146, TACAIDS 5,438,151, PMO - RALG 570,410, National Malaria Control Programme (ACT) During the year 2011/2012 the National Malaria Control Programme (NMCP) had a total of Shs 32,162,839,278 available for implementation of Global Fund activities. However, as at 30 th June, 2012 there was unspent balance of Shs. 2,818,698,100, indicating that NMCP spent Shs. 29,344,141,578 i.e. 91% as analyzed in Table 18 below: Table 18:- Sources of funds for ACT -2011/2012 Details Amount (Shs.) Opening balance at 1/7/ ,175,979 Add: Fund received during the year 32,099,663,699 Total funds available during the year 32,162,839,678 Less: Total expenditure for 2011/ ,344,141,578 Balance carried down 30/6/2012 2,818,698, Diagnostic Service Section (DSS) During the year 2011/2012 the Diagnostic Service Section (DSS) had a total of Shs 3,947,885,860 available for implementation of Global Fund activities. However, as at 30 th June, 2012 there was unspent balance of Shs 31

44 1,596,406,018, indicating that DSS spent only Shs. 1,451,479,842 i.e. 48% as analyzed in Table 19 below: Table 19: Sources of funds for DSS -2011/2012 Details Amount (Shs.) Opening balance at 1/7/2011 2, 939,824,392 Add: Fund received during 108,061,468 the year Total funds available during 3,047,885,860 the year Less: Total expenditure for 1,451,479, /11 Balance carried down 1,596,406,018 30/7/ The Global Fund Round Six Disbursed to the National TB and Leprosy Programme ( NTLP) During the year 2011/2012 the National TB and Leprosy Programme (NTLP) had a total of Shs 9,549,945,620 available for implementation of Global Fund activities. However, as at 30 th June, 2012 there was unspent balance of Shs. 1,360,481,593, indicating that NTLP spent Shs. 7,848,648, i.e. 83% as analyzed in Table 20 below: Table 20: Source of funds for the National TB and Leprosy Programme (NTLP) -2011/2012 Details Amount (Shs.) Opening balance 3, 504,768,943 Add:Fund received during the year 6,045,176,677 Unpresented cheques 340,815,604 Unutilized imprest NIL Intrest earned NIL Total funds available during the year 9,549,945,620 32

45 Less: Total expenditure 7,848,648,423 Balance carried down 1,360,481, Global Fund Round Eight-National Nets Support Programme During the year 2011/2012 the National Nets Support Programme had a total of USD 24,632,497 available for implementation of Global Fund activities. However, as at 30 th June, 2012 there was unspent balance of USD 1,065,380 indicating that NNSP spent USD. 23,567,117 i.e. 96% as analyzed in Table 21 below: Table 21: Sources of funds for Round Eight-National Nets Support Programme -2011/2012 Details Amount (USD) Opening balance at 01/07/ ,704,329 Add: Fund received during the year 3,928,168 Total funds available during the year 24,632,497 Less: Total expenditure for 2011/ ,567,117 Balance carried down 30/06/2012 1,065, National AIDS Control Programme (NACP) During the year 2011/2012 the National AIDS Control Program (NACP) had a total of Shs 6,038,729,953 available for implementation of Global fund activities. However, as at 30 th June, 2012 there was unspent balance of Shs.1,932,144,951, indicating that NACP spent only Shs. 4,106,585,003 i.e. 68% as analyzed in Table 22 below: Table 22: Source of funds for NACP -2011/2012 Details Amount (Shs.) 2011/2012 Opening balance 4,427,030,560 Add: Funds received during the year 1,611,699,394 Other income(stale cheques) 33

46 Total funds available during the year 6,038,729,954 Less: Total expenditure 4,106,585,003 Balance carried down 1,932,144, Monitoring and Evaluation Global Fund Round 8 as Implemented by the Ministry of Health and Social Welfare During the year 2010/2011 the Ministry of Health and Social Welfare had a total of Shs 102,569,551 available for implementation of Global fund activities. However, as at 30 th June, 2012 there was unspent balance of Shs. 58,774,401.14, indicating that the Ministry of Health and Social Welfare spent only Shs. 43,795, i.e. 43% as analyzed in Table 23 below: Table 23: Source of funds for Monitoring and Evaluation Global Fund Round 8 as Implemented by the Ministry of Health and Social Welfare -2011/2012 Details Amount (Shs.) Opening balance at 1/7/ ,826, Add: Fund received during the year 57,742, Total funds available during the year 102,569, Less: Total expenditure for 2011/ ,795, Balance carried down 30/6/ ,774, Global Fund Round 8 BOT USD Account During the year 2011/2012 the Global Fund Round 8 USD Account had a total amount of USD 94,330,124 available for implementing Global Fund activities. However, as at 30 th June, 2012 there was unspent balance of USD 12,764,287, indicating that Global fund Round 8 USD Account spent USD 81,565,837i.e.86% as analyzed in Table 24 below: Table 24: Source of funds for Global Fund Round 8 BOT USD Account -2011/

47 Details Amount (Shs.) Opening balance at 1/7/ ,156,536 Add: Fund received during the year 67,173,588 Total funds available during the year 94,330,124 Less: Total expenditure for 2011/ ,565,837 Balance carried down 30/6/ ,764, Global Fund implemented by Medical Stores Department (MSD) During the year 2011/2012 the Medical Stores Department (MSD) had a total of Shs. 99,996,669,157 available for implementation of Global Fund activities. However, as at 30 th June, 2012 there was unspent balance of Shs. 31,920,182,964, indicating that MSD spent only Shs. 56,878,585,838 i.e. 60% as analyzed in Table 25 below: Table 25: Source of funds for Medical Stores Department (MSD) -2011/2012 Details Amount (Shs.) 2011/2012 Opening balance at 1/7/2011 4,788,172,713 Add: Fund received during the year 95,208,496,444 Total funds available during the year 99,996,669,157 Less: Total expenditure for 2011/12 59,878,585,838 Balance carried down 30/7/ ,118,083, Health System Strengthening- Global Fund Round 9 During the year 2011/2012, the Ministry of Health and Social Welfare had a total of Shs.7,365,984, available for implementation of Global Fund Round 9 activities. However, as at 30 th June, 2012 there was unspent balance of Shs. 2,787,926,698, indicating that the Ministry of Health and Social Welfare spent only Shs.4,578,057,698.8 i.e. 62% as analyzed in Table 26 below: 35

48 Table 26: Source of funds for Health system strengthening- Global Fund Round /2012 Details Amount (Shs.) Opening balance at 1/7/ ,800, Add: Fund received during the year 6,890,184, Total funds available during the year 7,365,984, Less: Total expenditure for 2011/12 4,578,057, Balance carried down 30/7/2012 2,787,926, Global Fund PMO-RALG During the year 2011/2012, the PMO-RALG had a total of Shs 400,432,750 available for implementation of Global Fund Round 9 activities. However, as at 30 th June, 2012 there was unspent balance of Shs. 75,795,340, indicating that PMO-RALG spent Shs. 324,637,410 i.e. 81% as analyzed in Table 27 below: Table 27: Source of funds for Global Fund PMO-RALG /2012 Details Amount (Shs.) Opening balance at 1/7/ ,944,387 Add: Fund received during the year 90,410,575 Add: Fund received from various debtor 246,077,788 Total funds available during the year 400,432,750 Less: Total expenditure for 2011/ ,637,410 Balance carried down 30/6/ ,795, Global Fund (GF) TACAIDS Funds During the year 2011/2012, the Tanzania Commission for AIDS had a total of Shs. 6,193,977,084 available for implementation of Global Fund activities. However, as at 30 th June, 2012 there was unspent balance of Shs. 1,419,815,924 indicating that the TACAIDS spent Shs. 4,774,161,160 i.e. 77 % of the funds available as analysed in Table 28 below: Table 28: Source of funds for Global Fund (GF) TACAIDS Funds 2011/2012 Details Amount (Shs.) 36

49 Opening balance 932,643,027 Add: Fund received during 5,261,334,057 the year Total funds available 6,193,977,084 during the year Less: Total expenditure 4,774,161,160 Balance carried down 1,419,815, Other Projects (excluding Global fund) During audit, the financial performance of other projects which adds to 93 in total were evaluated. Key aspects considered were contributions from Development Partiners, opening balances, amounts received; expenditure incurred during the year and amounts remaining as unspent balances at the year end. See detailed analysis in Annexure V. CHAPTER FOUR PRESENTATION AND ANALYSIS OF AUDIT RESULTS 37

50 4.0 Introduction This chapter analyses the grounds which gave rise to issuance of a particular type of opinion to a Donor Funded Project. The analysis is aimed at amplifying the basic criteria used in forming the opinions as discussed in the preceding chapter. A total of four (4) major Donor Funded Projects were audited in the financial year 2011/2012. Another ninety three (93) other Donor Funded Projects were also audited making a total of ninety seven (97) Donor Funded Projects with a total of 616 audit reports and management letters issued. 4.1 Major Donor Funded Projects TANZANIA SOCIAL ACTION TRUST FUND (TASAF) Introduction The Tanzania Social Action Fund Project Phase II was established on 19 th January, 2005 when the agreement between the Government of the United Republic of Tanzania and the World Bank through the International Development Association (IDA) and the Development Financing Agreement was signed. The Second Tanzania Social Action Fund Project (TASAF II) which forms part of the National Poverty Eradication Strategy was established to empower Communities to access opportunities that contribute to improved livelihood linked to the Millennium Development Goals (MDG), an indicator targets in the Tanzania Poverty Reduction Strategy (TPRS). According to the terms of reference in the TASAF Operational Manual, the objective of conducting the audit is to enable the Controller and Auditor General to express an independent opinion on the TASAF project financial statements for the year under review. 38

51 Operational Objectives The Second Tanzania Social Action Fund Project (TASAF II) was established to empower Communities to access opportunities that contribute to improved livelihood linked to the Millennium Development Goal (MDG) indicator targets in the Tanzania Poverty Reduction Strategy (PRS). TASAF II also aims at:- (i) (ii) (iii) (iv) Promoting formation of voluntary saving groups. Providing support services to communities that will contribute to increased availability and use of basic Social and environment service in line with Specified MDGs targets. Providing employment opportunities to able-bodied individuals in food insecure households, so as to increase their cash income, skills and opportunities of working in VFC financed public work programmes. Providing assistance to households with vulnerable individuals which include ophans, disabled, elderly, and those infected or affected by HIV/AIDS, among others to enable them manage sustainable economic activities Project Management (i) National Level TASAF II Project at the National level is managed by autonomous TASAF Management Unit (TMU) headed by the Executive Director under the President s Office. TMU Coordinates and executes the daily activities of TASAF II. The Executive Director of TASAF reports to the National Steering Committee (NSC) on all the financial and administrative matters connected with the execution of TASAF II programmes. (ii) District Level 39

52 At the District level, the District Executive Directors (DED)/ Municipal Directors (MD) as the head of the District Councils/Municipals for the Local Government team, provide the needed support to TASAF II management team led by the Village Fund Coordinators (VFC). The VFCs are appointed by the District or Local Councils from among qualified existing Council/Municipal Staff in accordance with the terms of references provided by the TMU. The VFC coordinate the activities of TASAF II in the District Council including sensitization and facilitation of the communities on matters pertaining to the implementation/execution of approved community subprojects. VFC is accountable to the TMU on behalf of the Council Directors. According to the terms of reference in the TASAF Operational Manual, the objective of conducting the audit is to enable the Controller and Auditor General to express an independent opinion on the TASAF project financial statements for the year under review. The under listed Councils were audited in the financial year 2011/2012 and the type of audit opinion issued and reasons for giving rise to the issuance of such opinion are as indicated in the respective tables hereunder:- (a) Table 29: Councils issued with unqualified opinion Twenty eight (28) Councils out of a total of 127 Councils audited which is 22% managed to be issued with unqualified audit opinion as listed below: SN Council SN Council 1 Bukombe DC 15 Mtwara MC 2 Korogwe TC 16 Newala DC 3 Moshi MC 17 Mtwara DC 4 Mwanga DC 18 Njombe DC 5 Tanga CC 19 Mvomero DC 6 Lindi MC 20 Ukerewe DC 7 Nachingwea DC 21 Kilosa DC 8 Lindi DC 22 Ilala MC 40

53 9 Mkuranga DC 23 Ulanga DC 10 Kibaha TC 24 Singida DC 11 Bukoba MC 25 Singida MC 12 Iramba DC 26 Tunduru DC 13 Kibondo DC 27 Mbozi DC 14 Temeke DC 28 Morogoro MC (b) Table 30: Councils issued with unqualified opinion with emphasis of matters: A total of seventy five (75) Councils out of a total of 127 Councils audited which is 59 % managed to be issued with unqualified audit opinion with matters of emphasis as listed below: 1 Bunda DC Payments made but not supported by activity reports Shs. 3,917,500 Substandard works on completion of one Staff House at Bulamba Secondary School Shs.29,000,600. Uncompleted works on the construction of Busamba- Namalama road Shs 31,920,000 Uncompleted works on the Administration Block at Kwiramba Secondary School worth Shs.40,237,700 2 Musoma DC Implementation of Auditor s Recommendations Council Management has not responded to the observation raised by Auditors in TASAF Financial Statements for the previous financial year ended 30 th June 2011 and also no response for the issues raised for the year under review. Uncompleted projects worth Shs. 523,844, Unimplemented activities worth Shs.174,123,880 3 Musoma MC Toilet constructed and completed but not in use in Kigera Primary School Shs.9,900,000 Uncompleted works on construction of staff toilet at Mwisenge Secondary School Shs.7,937, Uncompleted works on construction of classrooms, 41

54 staff latrine, and administration block at Baruti Secondary School Shs.17, 752, Serengeti DC Unproduced BOQ and contract on the rehabilitation of Gesarya Dispensary Shs.12,536,900 5 Tarime DC Uncompleted works upon construction of Administration block at Masanga Secondary School Shs.19,453,000 Planned activities worth Shs.133, 382, were partially implemented. 6 Chato DC Non respond to implemention of previous years auditor s recommendations valued Shs. 178,837, Questionable and improper implementation of TASAF project at Kanyindo Primary School Shs. 11,149, Kahama DC Biological Assets, Agricultural assets and Monitoring and supervision expenses worth Shs. 106,872, were included in the figure of Property Plant and Equipment contrary to IPSAS17(6)(a)-(b). Accelerated Food Security Programme Activities not Supported by Certificate of Completion Shs. 401,317, Shinyanga DC Previous year s recommendations raised amounting to Shs. 105,644,027 Nyashimbi Charco dam was not in use with reason behind that the area is dry and has no enough water, hence delay in delivering expected benefits to the Communities of Nyashimbi Village. 9. Bariadi DC Council managed to implement projects worth Shs. 56,149,714 but had not prepared and submitted projects justification reports to the relevant Authorities as at the time of audit. Two construction works worth Shs.461, 254,234 at Nkololo and Mehembe villages have not been completed; hence delay in delivering expected benefits to the intended communities. 42

55 10 Kishapu DC A payment voucher worth Shs. 1,650,000 had been missing from relevant batches. A scrutiny of the Statement of Comparison of Budget and Actual - by nature revealed that Shs. 888,840 was spent over and above the approved budget. Audit review of the project performance and physical verification revealed some project activities worth Shs. 181,240,370 were partly implemented. There were outstanding cheques in the bank reconciliation statements under TASAF account worth Shs 1,350,000 as at 30 th June, Maswa DC Unutilized funds amounting to Shs. 297,035,489 which imply that some planned activities of the same magnitude were partially or not implemented. Five (5) construction works worth Shs. 113,274,450 were in progress though their contractual periods had expired and there were no evidences produced to confirm whether the Council had granted extension of time to the Contractor. Construction of OPD Buildings at Mwadila, Kadaganda and Bugarama Dispensaries worth Shs. 67,337, completed but not in use. 12 Meatu DC There was unutilized funds amounting to Shs. 208,017, which imply that some planned activities of the same magnitude were partially or not implemented Shs.86, 770, was not acknowledged; therefore we were unable to confirm whether the transferred fund was actually received by the bonafide payee. 13 Mwanza CC Planned projects not executed Shs. 42,613,450 Construction of 3 classrooms at Mkuyuni primary School Shs. 25,781,800 Construction of Teacher s house, Kabangaja Shs. 16,831,650 Ten (10) projects worth Shs. 263,462,686 were still in 43

56 progress, implying delay in service delivery to the respective communities. 14 Misungwi DC There was unspent balance of Shs. 125,293, which implies that some of planned and approved TASAF Activities for the financial year 2011/2012 were either partially implemented or not implemented. Uncompleted works on Construction of Charcoal Dams Shs 86,852, Three (3) Milling Machines subprojects not yet installed Shs 27,681, Money disbursed to three (3) villages for Charcoal Dams but implementation has not started Shs 39,831, Questionable Sustainability of three (3) Fish Farming subproject namely Nyamatala, Mwakalima and Mwaniko amounting to Shs 23,473, Money for Functional activities received but not transferred to the respective subprojects Shs 71,235, Shs. 2,224, paid to various suppliers but these payments were made in the financial year 2011/2012 in respect of previous year claims contrary to Order No. 22(1) of the Local Authority Financial Memorandum (LAFM), Arusha DC 16 Babati TC Payments to the tune of Shs. 4,285,000 were apparently not effected by cheque contrary to Order No. 68 of LAFM, 2009 Non maintenance of Vote book this is contrary to The Local Authority Financial Memorandum (LAFM), 2009 Order No. 23(1) and (2) There was unspent balance of Shs. 77,445,124 which implies that some of planned and approved TASAF Activities for the financial year 2011/2012 were either partially implemented or not implemented. 17 Karatu DC Action plan for the year 2011/2012 was not prepared. 44

57 Hence making it difficult for the audit to know the activities which were planned for implemention. Commitment control over expenditure charge not in place and non maintenance of vote book. 18 Lushoto DC There was unutilized amount of Shs. 112,545,105 due to delay in disbursement of funds this implies that some of planned and approved TASAF activities for the financial year 2011/2012 were either partially implemented or not implemented. 19 Babati DC There was unspent balance of Shs. 31,691,389 which implies that some of planned and approved TASAF Activities for the financial year 2011/2012 were either partially implemented or not implemented. 20 Hai DC Shs 9,792, was disbursed for cultivation of vegetables had not yet started as construction of bore hole to be used for Vegetables irrigation project was at initial stage. Milk goat keeping for elderly at Tindigani village amounted to Shs.10,349,500 Onion cultivation was partially implemented at Mungushi village amounted to Shs.8,816, Handeni DC The charcoal dam was constructed near another charcoal dam constructed by DADPs on the same line of water inlet and therefore, during the rainfall season water can only reach the newly constructed charcoal dam (TASAF) leaving DADPS dam dry. Goat keeping projects at Kidereko and Kweisasu villages worth Shs.21,775,238 are not properly managed. 22 Kilindi DC There was unspent balance of Shs. 139,841,929 which implies that some of planned and approved TASAF Activities for the financial year 2011/2012 were either 45

58 23 Longido DC partially implemented or not implemented. Financial statement prepared report only funds for National village funds and omitted fund for Operational funds of Shs.34,323,003. There was unspent balance of Shs. 356,892,004 which implies that some of planned and approved TASAF Activities for the financial year 2011/2012 were either partially implemented or not implemented at all 24 Meru DC Payment vouchers not stamped and pre audit not effective Shs.3,060,000 Delay in rehabilitation of water system at Poli Ward Shs. 27,668, There was unspent balance of Shs. 27, 226, which implies that some of planned and approved TASAF Activities for the financial year 2011/2012 were either partially implemented or not implemented 25 Mkinga DC Unimplemented activities worth Shs 19,294,81 26 Moshi DC Planned activities worth Shs 88,787,895 were not implemented. 27 Siha DC Unimplemented activities worth Shs 20,139, Pangani DC Activity Performance report not prepared Payments made direct to individual members of groups instead of CMC bank accounts Shs. 236,953,630 Unimplemented activities worth Shs 4,272, Morogoro DC The Council planned to implement 20 sub projects valued at Shs. 159,878,048. However, up to 30 th June, 2012 those activities were not implemented due to non release of funds from TMU. The Council implemented 14 activities worth Shs.215,877,237, however up to 30 th June, 2012 those activities were partially implemented to the tune of Shs. 87,055,819 leaving activities amounting to Shs. 46

59 128,821,419 in progress. 30 Kilombero DC Shs. 33,000,000 was received instead of Shs.13, 636,363 and the project was changed from construction of mikumi-mikoleko road to construction of a bridge. Shortcomings noted in projects quarterly progress report Financial and physical progress reports are not consistent when compared with financial statements figures. Progress reports did not show the status of some of the sub project as a results it is difficult to understand actual implementations status The quarterly progress report did not show approved budget for the year, fund released unrealized, actual expenditure and unspent balance. 31 Rombo DC Activities worth Shs. 91,448, were partially implemented or not implemented. 32 Kilwa DC Activities amounting to Shs. 91, 103,556 were not implemented and completed. Non Disclosure of the Progress Report for the Activities carried during the financial year under Review Shs. 231,795, A sum of Shs.25, 277,838 transferred to various villages could not be confirmed to have reached the respective villages 33 Liwale DC Activities allocated with funds but not yet implemented Shs. 40,351,240 Activities amounting to Shs. 65,194,178 were not implemented. 34 Ruangwa DC Activities amounting to Shs.271,015,787 are still in progress. 7 sub projects allocated Shs.82,438,300 were not 47

60 implemented Acknowledgement receipts to support the amount of Shs.20,785,050 paid to various CMCs were not produced for audit verification. 35 Mafia DC Non sustainability of a poultry farming sub project at Chole Village Shs. 8,790,000 Projects worth Shs. 69,493,600 which had been completed but having some defects. 36 Bagamoyo DC Uncompleted construction of Administration Block at Zinga Secondary School. Payments of operations nature paid from NVF account - Shs.11, 524, Kibaha DC Though the dispensary building have been completed the solar power is not yet installed 38 Kisarawe DC Construction of Mzenga A Market without following the approved drawings Shs. 32,640, Shs. 30,977, was disbursed for construction of teacher s house.the project had not been completed although three years had elapsed.this is contrary to one year standard set for TASAF funded projects. 39 Rufiji DC Substandard completion of three classrooms and Septic tank at Ngorongo - Shs. 8,142,562 Uncompleted construction of laboratory at Ruaruke Secondary School Shs.19,700, Biharamulo DC Undelivered desks worth Shs.270, Muleba DC Non preparation of the Project Budget Irregularities noted on construction of pit latrine holes Shs. 31,508, Shinyanga MC Uncompleted Construction works worth Shs.60,259,500 Two sub projects were totally collapsed, and no action appeared to have been taken by the Municipal 48

61 Management. In this circumstance,the Community has not derived the expected benefits. 43 Bukoba DC Un implemented Previous Years Auditors Matters Shs. 215,783, Three (3) Dispensaries constructed and completed but not giving services to the society Shs. 35,213, Uncompleted construction of Katoma Market Shs. 8,861, Tabora MC Projects worth Shs.346,725,451 equivalent to 27% of the fund received were still in progress. Construction of two in one doctor s house at Lusangi dispensary not completed Shs.37, 373,130 Construction of three (3) classrooms at Tumbi Secondary School not yet completed Shs.49, 929,779 Indigenous seed processing Machine for Hospital Group not yet completed Shs. 10,000, Manyoni DC Procurement made without quotations Shs. 5,340,000 Procurement made without approval of tender board Shs. 3,374, Bahi DC Funds received at the end of financial year for TASAF Activities Shs.186,466,772 Payments made to District Executive Director instead of directly to payee Shs.8,225,000 Non preparation of subproject procurement plans. 47 Nzega DC Activities of TASAF not implemented Shs.4,192, Urambo DC Shs. 39,203,560 issued to two villages for construction of teachers houses but as at the end of the reporting period the activities were not implemented. 49 Chamwino DC Planned activities worth Shs. 181,083, were found to be in initial stages of implementation 50 Igunga DC 49

62 Items not taken on ledger charge Shs.5,648,600 Misstatement of financial statements 51 Kondoa DC TASAF sub projects partly Implemented Shs. 191,885,060 Delay in implementation of TASAF Project activities at Gwandi Village-Shs.23,300, Sikonge DC The Council has not implemented the previous year s audit recommendations which were made on major findings 53 Sengerema DC Financial Statement of NATIONAL VILLAGE FUND for the year ended 30 th June 2012 reported Shs.34,816,000 as payments for facilitation of Development Projects. However, it was not established how the figure reported was derived from thus misleading users of Financial Statements in making decision Payments made to wrong expenditure codes Shs.5, 650,000 Transfer of money to Subprojects accounts without acknowledgement receipts Shs.31,574, % Village Council Money loaned to DED for operational activities, not refunded Shs. 5,090, Council contribution to TASAF accumulated to Shs.23,000, not yet paid 54 Masasi DC Inadequately supported expenditure Shs.3,340,000 Approved CMC projects amounting to Shs.44,925, approved by TMU were changed from original projects without prior approval from TMU The Council paid Shs.5,992,700 for purchase of fuel to be used for supervision of TASAF activities. However, utilization details showing registration number of vehicles utilized the fuel could not be availed for audit verification. 55 Nanyumbu DC Unconfirmed utilization of 396 liters of diesel worth Shs.904,

63 56 Iringa MC 34 goats worth Shs.2,380,000 meant for subproject at Kamundi village died. Therefore no value has been received on this subproject. Site visit made to Mnomia water sources conservation noted that 96,100 trees worth Shs.3,390,000 were planted in the conservation of eight (8) water sources areas. However, all the trees were dried due to dry climate. The Council did not spent Shs. 123,138,595 out of the total available funds amounting to Shs. 171,963,062 which is 71.7% for implementation of various TASAF activities due to late release of funds. Sub standard construction of Toilets at Tagamenda Secondary School Shs. 11,972,773 Incorrect Deferred Capital grant reported Shs. 153,901, Mbeya CC Fund received less than planned by Shs 217,183,820 Uncompleted projects of the roll over activities worth Shs 92,843,000 Completed but not in use of roll over activities Shs 40,282, Mbinga DC Delay in submission of the Financial Statements for audit purpose Outstanding matters from previous years auditors observations and recommendations Shs. 1,990, Mpanda DC Uncompleted TASAF Projects Shs. 203,501, Non disclosure of financial transactions related to funds transferred to TASAF sub projects for development activities Shs. 143,376, Iringa DC Implemented projects worth Shs.209,308,071 were still in progress. Delay in completion of the projects might result in budget revision due to price escalation of building materials. 51

64 61 Kilolo DC Payment amounting to Shs.1,189,000 were made in respect of maintenance of motor vehicles.however, no inspection was made before and after vehicle s maintenance to ascertain the validity of service delivered. 62 Sumbawanga DC Unreported balance of TASAF NVF funds sent to projects committees in villages for implementation of 2011/2012 planned activities Shs. 30,723,062. Understatement of Cash and Cash equivalent balance Shs. 30,723,062. Irregularities noted in construction of Toilets in different schools and dispensaries shs 17,402,600. TASAF project not completed Shs. 5,325, Ludewa DC District Council under TASAF had no approved budget for implementation of TASAF activities worth Shs.17,072, Makete DC Mfumbi market was not completed as there were no market facilities such as tables/slabs, however, the community used the market place for selling local brew without the approval of the Council commitees. This implies that the utilization of the market before completion may lead to deterioration of the market within a short period hence the value for money may not be achieved. 65 Mbeya DC TASAF II projects not reviewed by the Council s Audit Committee. Site Activities missing back to office report Sh. 8,630,000 Goods not taken in Ledger Shs. 1,669, Procurement not in the procurement plan Shs. 2,900, Mufindi DC The Council management did not prepare a budget 52

65 for TASAF rather, plan and activities to be implemented were developed soon after receiving Shs.13,202, Songea DC Improperly authorized payments Shs.1, 530, Payments not passed through pre audit department Shs. 1,290, Rungwe DC The Council s management should include the Motor Vehicle owned by TASAF (STK 2123-Land Rover) in the financial statement of TASAF under Property, Plant and Equipment 69 Geita DC Understatement of comparison figure of amortization of Capital Grants Shs.154,935,000. Overstatement of Recurrent Grants Shs.1,420, Misenyi DC Overstatement of Deferred Capital grants Shs. 4,382, Simanjiro DC Development grants received presented as recurrent grant Shs.684, 271,022 Unimplemented activities worth Shs. 298,001, Mpwapwa DC Sub projects allocated with funds but not yet implemented Shs. 295,982, On 2 nd November, 2011 to 16 th May, 2012 the Council received Shs.324,252,053 from TMU, but the transfers to respective CMCs started on 20 th February, 2012 to 21 st June, This implies that the Council causes a delay on implementation of planned activities at the village level. 73 Kongwa DC Funds disbursed not acknowledged Shs. 378,386, Sub projects not implemented/completed Shs. 45,056,455 Previous years audit outstanding matters Shs. 53,833,648 Procurement of goods through special imprest 53

66 Shs.4,235, Tandahimba DC Shs.173,171,546 was transferred to community management committee for implementation of various subprojects. However no evidence that respective subprojects were implemented 75 Tabora DC Shs. 62,540,000 transferredto various villages for implementation of TASAF activities but the payment vouchers used to transfer the funds were not supported by acknowledgment receipts from respective villages to confirm that they received the money.this contravene Order Nos. 8(c) and 10 (2)(d) of the Local Authority Financial Memorandum,2009. (c) Table 31 : Councils Issued with Qualified Opinion On the other hand, a total of twenty four (24) Councils out of a total of 127 Councils audited which is 19 % were be issued with qualified audit opinion as listed below: 1. Karagwe DC On the selected subprojects we noted uncompleted works, works in progress and completed construction of village dispensaries but not put into use, all aggregating to Shs.24,941,804. Poor workmanship in completion of construction of Administration block at Kawela and Kayanga Secondary schools Shs.5, 277, Hanang DC Misstatement of financial performance There was unspent balance of Shs. 130,224,263 which implies that some of planned and approved TASAF Activities for the financial year 2011/2012 were either partially implemented or not implemented. 3. Kiteto DC Misstatement of Financial Performance Non disclosure of Notes to the financial statements as per IPSAS s 1- Presentation of financial statement 54

67 4 Mbulu DC.Motor vehicle STK 2114 (Toyota Land rover) was not disclosed in the financial statement under property, plant and equipment. Expenditure amounting to Shs. 4,003,500 was not supported with adequate supporting documents contrary to order No.8 (2c) of the LAFM Up to 30 th June 2012 there was an unspent balance of Shs. 27,795, or equivalent to 4.2% indicating that Annual plan under the TASAF II activities was not fully discharged. Shs.9,013,000 were made without prior examination by internal audit unit, contrary to Order No. 11 (2) of LAFM 2009 Expenditures amounting to Shs.1,537,500 were charged to wrong expenditure code contrary to order No. 23 (1) of LAFM Korogwe DC Misstatement in the financial performance Cash and cash equivalent figures understated by Shs. 679, Irregularities in Procurement and Utilization of fuel worth Shs.1, 833,700 The reflected figure of the recurrent grants in the statement of financial performance was Shs. 387,412, while the actual amortized grant was Shs. 445,449,396. Therefore the revenue part was under stated by Shs. 58,037, Muheza DC Fuel not recorded in the stores ledger Shs. 3,329,600 this is contrary to order No 59(1) of LAFM of Monduli DC Bank adjustment without written communication Shs. 13,629,250 Stores not taken on ledger charge Shs. 2,100,000 Non-inclusion of TASAF operation in the financial statement Shs. 5,179,133 There was unutilized fund amounting to Shs. 92,664,717 which implies that some planned activities were not implemented. 55

68 Uncompleted construction of roads in 5 villages Shs.134,011,000 8 Ngorongoro DC Recurrent grant in the Statement of financial Performance of Ngorongoro District Council for the year ended 30 th June 2012 was understated by Shs. 19,383,000. There was unspent balance of Shs. 15,428, which implies that some of planned and approved activities were either partially implemented or not implemented. 9 Same DC Understated figure of cash and cash equivalent by Shs. 15,485, Planned activities worth Shs. 19,093, were not implemented on time hence community denied expected benefits to the community were denied. 10 Dodoma MC Non preparation of statement of change of net asset Non disclosure of accounting policies Understatement of PPE Shs.37,482,245 Funds received at the end of financial year for TASAF Activities Shs.161,984,601 Non maintenance of updated fixed assets register 11 Kasulu DC Supporting schedules not submitted with the financial statements Understatement of Comparative opening balance for cash and cash equivalent by Shs. 28,671, Kigoma DC Accounting documents for funds transferred to 5 villages not produced Shs. 95,897, Kigoma/Ujiji MC Irregularity in the presentation of Financial Statements The Council purchased some items worth Shs. 12,004,000 for Council use but the same were not recorded in the stores accounting books 14 Kwimba DC Un vouched expenditure Shs.9,893,270 56

69 Improperly Vouched expenditure Shs.24,278, Ngara DC A constructed house is used by students as a hostel in steady of being used by teachers. Activities amounting to Shs. 25,160, were not implemented and the amount received by Ward Development Committees had not been utilized as at the time of audit. 16 Mpanda TC Unsupported Payments: Transfer of Fund from N.V.F A/C to operation A/C being 8.5% being addition fund for five projects Shs.2,109, Being 1.5% of fund for transferring to villages Accounts for Administration of TASAF projects Shs. 321, Transfer of Fund from N.V.F A/C to operation A/C for safari to Dar-es-salaam Shs.600,000 Transfer of Fund from N.V.F A/C to operation A/C for administration of TASAF projects Shs.1,000,000 Transfer of Fund from N.V.F A/C for operation A/C for TASAF projects (10% of 16,278,080.) Shs.1,627,808 The presented financial statements did not comply with IPSASs requirements Unresolved previous year s audit findings valued at Shs. 400,346,330/- 17 Namtumbo DC Decrease of Deferred revenue grant reflected in the cash flow statement but no entry disclosed in the statement of financial position relation to deferred grants18, 076,295 The presented financial statements did not comply with IPSASs requirements 18 Nkasi DC Misstatement in IPSAS financial statement presentation involving understatements and non disclosure in financial statements -There was understatement of expenses in financial year 2011/2012 to the extent of shs 36,055,536/- in 57

70 the Statement of Financial Performance. -understatement of Liabilities in financial year 2011/2012 to the extent of shs 5,500,278/- in the Statement of Financial Performance. Unresolved previous year s audit findings valued at Shs 94,843,227 Delay in completion of projects valued at Shs 21,780, Sumbawanga MC Projects completed not in use Shs. 11,387,440/- The presented financial statements did not comply with IPSASs requirements - Cash flow statement shows that there was no Property, Plant and Equipments acquired during financial year 2011/2012.However the financial performance shows that in financial year 2011/2012 capital grant of shs 62,839, was spent and Note 37 for capital expenditure and its financing shows that capital expenditures amounted to shs 232,266,521 - Cash flow statement shows that there was no development grant received during financial year 2011/2012.However Note 37 for capital expenditure and its financing shows that capital receipt during the year amounted to Shs. 233,674,360 - Deferred revenue grant does not have supporting notes. 20 Songea MC The presented financial statements did not comply with IPSASs requirements 21 Chuya DC The presented financial statements did not comply with IPSASs requirements Unrefunded TASAF Project Fund transferred to General Fund Shs. 101,500,000. Double payment for Night out Allowances amounting to Shs.2,890,

71 22 Arusha MC Improperly vouched expenditure, Shs. 6,084,922 Un vouched expenditure, Shs. 30,905,515 Planned activities worth Shs. 30,899, were not implemented on time hence expected benefits to the community were denied. 23 Rorya DC No accounting note was prepared to support the figure of amortization recurrent grants of Shs.13,912,718 Unsupported figure for expenses Shs.150,308,613 Lack of analysis to support the figure of amortization recurrent grants of Shs. 32,540,396 Unsupported figure for expenses Shs. 30,264,737 TASAF NVF Cash and cash equivalent shown in statement of financial position not analyzed Shs. 45,644, Magu DC Unsupported figure for net cash used in financing activities Shs.20, 288,024 Payments made to wrong expenditure codes Shs.6, 445,000 Payments not supported by night claim forms Shs. 12,950,000 Deferred payments Shs. 1, (e) (f) Njombe DC was not allocated with funds The under listed Councils financial performance are not included in this report because they were incorporated in the CAG annual report for the TASAF financial statements for the year ended 30 th June, Kyela DC Mbarali DC Ileje DC Kinondoni MC AGRICULTURAL SECTOR DEVELOPMENT PROGRAMME Introduction The Government of Tanzania has adopted an Agricultural Sector Development Strategy (ASDS) which sets the 59

72 framework for achieving the sector s objectives and targets. An Agricultural Sector Development Programme (ASDP) Framework and Process Document which was developed jointly by the five Agricultural Sector Lead Ministries (ASLMs) which are Agriculture, Food Security and Cooperatives,Livestock Devlopment and Fisheries,Water and Irrigation, Industries,Trade and Marketing and PMO RALG provides the overall framework and processes for implementing the ASDS. Development activities at the district level are implemented by the Local Government Authorities (LGAs), based on the District Agricultural Development Plans (DADPs). The DADPs are part of the broader District Development Plans (DDPs). In line with the ASDP, the Government and Development Partners are working together in formulating a consolidated set of interventions in support of the ASDP. The interest to support the ASDP basket has been expressed in principle by the following development partners: Danish International Development Agency (DANIDA), Japan International Cooperation Agency (JICA), the European Union (EU), Irish Aid (IA), the International Fund for Agricultural Development (IFAD) and the International Development Association (IDA). A total of 132 Councils were audited except two Councils namely,dar es salaam city and Masasi Town Council which had no allocation of funds for the project in the financial year ended on 30 th June, The audit outcomes are narrated below:- (a) Unqualified opinion without Emphasis of matters A total of seventeen (17) out of the 132 Councils audited this year managed to be issued with Unqualified Opinion without emphasis of matters which is 13 % as shown in Table 30 below: 60

73 Table 32: Council issued with Unqualified Opinion Sn Council 9 Siha DC 1 Ilala DC 10 Hanang' DC 2 Rorya DC 11 Korogwe TC 3 Arusha DC 12 Tanga CC 4 Arusha MC 13 Sumbawanga DC 5 Meru DC 14 Sumbawanga MC 6 Hai DC 15 Tunduru DC 7 Moshi MC 16 Mafia DC 8 Rombo DC 17 Newala DC (b) Councils issued with Unqualified Opinion with Emphasis of Matters Out of the 132 Councils audited, 81 (61%) were issued with Unqualified Opinions with emphasis of matters as shown in Table 31 below: Table 33: Councils issued with Unqualified Opinion with Emphasis of Matters Bariadi DC There were unresolved previous matters. Failure to respond to the auditor s recommendation may lead to the recurrence of anomalies observed by the auditors in the subsequent financial reporting years. There was unspent balance of Shs. 1,175,985,635 for the year under review, implying that, annual plan under the ASDP was not effectively discharged. Inadequate progress of works on the construction of embankment earth dam at Kasoli irrigation scheme Shs. 2,005,923, The Council has not completed construction of Irrigation scheme valued Shs. 220,000,000 Some of expenditure incurred amounting to Shs. 8,800,000 was not sufficiently supported contrary to Order No. 5 (c) of LAFM Babati TC Over charging of depreciation to PPE relating to building that 61

74 was disclosed under note No.20 of financial statements where by the depreciation rate charged on building was 10% instead of applicable rate of 4% thus resulting to overcharging of annual depreciation amount of Shs.2,699,610. The internal auditor of the Council did not audit and prepare Internal Audit Reports in respect of ASDP for year 2011/2012 as required by Memorandum of Understanding (MoU). Shs.12,073,203 was paid to Kwaraa Group at Halla Village for procuring one maize milling machine and Construction of plant house,however, at the time of the audit,the construction of the plant house had not started eventhough three month has passed since the money was received by the group and the milling machine though procured was stored in one of the house of the villagers for which its security is not assured. 3 Bukoba DC Procurement of Machines in village groups not done Shs.109,000,000 Planned projects not implemented Shs.168,000,000 4 Bukoba MC 5 Bukombe DC The Council transferred a total sum of Shs.28,007, from DADPS account towards respective group s bank account being funds for implementation of various Agricultural Sector Development Programme activities within the farmer s groups in Bukoba Municipality. Projects are yet to be completed. Un implemented Previous Years Auditors Matters Shs. 521,728,656 Unutilized ASDP funds Shs. 585,083,522 Uncompleted Works upon project construction Shs. 4,840,940 Sub Standard Construction works at Katente village Shs. 9,555, Non construction of cattle crusher at Shilebela Village Shs. 8,000,000 6 Bunda DC Unspent balance Shs. 648,112, Unvouched Expenditure Shs. 27,928,200 Irregularities noted in Transfer of fund for Micro and Community Projects to Villages Shs.314,730,100 7 Chato DC 62

75 8 Geita DC Planned activities but not implemented Shs. 275,531,355 Uncompleted ASDP planned activities Shs. 65,192,615 Development Grant not transferred to DADPs Account Shs. 62,234,000 Double purchase of fuel through Imprest Shs. 4,622,200 Activity not implemented Shs. 58,987,689 9 Handeni DC Un implemented planned activities due to late release of funds Shs.137,578, Igunga DC The Council received the amount of Shs. 44,937,000 in the financial year 2010/2011 for purchasing a motor vehicle. The motor vehicle has not been procured. Outstanding previous years audit findings and recommendations Shs.514,095, Iramba DC Previous year audit outstanding matters amount to Shs. 14,976,000 Delay in release of project funds to the Council Shs. 304,326,000 Shortage of 297 Agriculture and Livestock Officers in villages and wards Improper accounting of issue of fuel worth Shs. 17,408,100 Development grants in the Councillors report understated by Shs. 61,231, Iringa DC Site visit made to some of the villages noted that funds issued at lower level/villages for implementing approved activities were not released timely. 13 Iringa MC The Council has a shortage of 14 staff. Inadequate number of staff may lead to slow pace on implementation of activities under Agriculture Department. 63

76 14 Kahama DC Unimplemented previous years auditors matters Shs. 856,010,846 this may recur in future operations. There was unspent balance of Shs. 629,522,227 for backlog activities in the year, implying that, annual plan under the ASDP was not effectively discharged 15 Karatu DC There is limitation of scope due to the fact that the Council has payments not adequately supported of Shs. 1,480,000 being missing payment vouchers amounting to Shs.760,000 and improperly vouched expenditure amounting to Shs.720, Kigoma DC Unutilized ASDP Funds Shs. 261,636,293 Improperly accounted imprests amount to Shs. 8,520,000 Unbudgeted expenditure of Shs. 1,710, Kilolo DC The human resource capacity in Agriculture Departments (Agriculture Unit, Livestock Unit and Cooperative Unit) at Kilolo District Council are more than the actual requirement as there is an excess of 54 staff. 18 Kinondoni MC There was un implemented activities of Shs. 139,510,556 Construction of Tegeta Nyuki market building not completed Shs. 55,000,000. Previous Years Auditors recommendations not implemented Shs. 1,092,020,393 Un utilized funds Shs. 36,527, Kishapu DC Unimplemented previous years Auditors matters Shs. 1,092,020,393 Un utilized funds Shs. 36,527, Kwimba DC The Council had planned activities valued at Shs. 1,983,800,000 which were not implemented. There were unutilized funds amounting to Shs. 1,983,800,000 64

77 in respect of activities which had not been implemented as per action plan. 21 Kyela DC Payment vouchers and their supporting documents of Shs.12,672,000 were missing from their respective batches contrary to Order No.8(2)(c) and Order No. 104 of LGFM (2009) Expenditure incurred amounting to Shs.7,910,000 was not sufficiently supported by proper documents contrary to Order No. 8(2)(c) of LGFM (2009) Payments amounting to Shs.6,996,500 were made without prior examination conducted by Pre Audit Unit of the Council contrary to Order No. 10 of LAFM (2009) and Reg. No.91(4) and (6) of Public Finance Regulations 2001 (Revised 2004). Supplies and consumables during the year under revieworthy Shs.12,917,450 whose, Invoices, Delivery notes and Issue vouchers were received before issuing Local Purchase Order and Local Purchase Requisition Store Documents to the suppliers contrary to Order No. 69 of LGFM, Longido DC Payment vouchers amounting to Shs.3,450,000 was not produced for audit. Activities not implemented and some are partially implemented amounting to Shs 148,435,361 We noted the planned activities for DADPS worth Shs.148,435,361 were not implemented during the year under review. The actual number of staff in the Agriculture Development Department is only 44 leaving a gap of 53 staff to meet the minimum requirement. 23 Lushoto DC Property, Plants and Equipments (PPE) worth Shs. 1,520,605,504 not supported by schedules of analysis in line with the requirements of IPSAS Magu DC The Council had planned activities valued at Shs. 146,160,000which were not implemented There were no supporting documents to proof amortization of development grant of Shs. 118,232,434 reported in the financial statements. 65

78 25 Makete DC Uncompleted construction of cattle dip work valued Shs.16,000,00 at Lugoda Village. The Department has a shortage of 187 staffs. The Council has no specific internal audit report issued in respect of ASDP activities. 26 Maswa DC The Council had planned activities valued at Shs. 40,812, which were not implemented Defects on completed construction works valued atshs.34,286, Mbinga DC 28 Mbulu DC Delay to submit financial statements. There is no single specific internal audit report in respect of ASDP which has been issued during the financial year contrary to Para. 8.5 of the ASDP Basket Fund Financial Mechanism Document of Our audit revealed that, DADPS projects amounting to Shs. 530,000,000 were either partially completed or were not started at all. No evidence to confirm delivery of 380 liters of fuel worth Shs. 855,000 the paid for fuel. Delay in construction of resources center and procurement of 2 Power tillers at Masqaroda Village worth Shs. 40,000,000 noted that, only one power tiller was purchased and the construction of resources center was not yet started although building materials had been purchased and were kept on the site. Delay in completion of irrigation scheme at Dongobesh Dam valued Shs. 1,283,352,660 The disclosed figure of Account receivable Shs. 29,525,000 in the cash flow statement is misstated. 29 Meatu DC The Council had planned activities valued at Shs. 364,391,350 which were not implemented A total amount of Shs. 2,745,200 was transferred from ASDP to other account as loan for payments of salaries to employees who did not appear in the payroll. However, as at the time of audit the amount was not confirmed to have been paid back to 66

79 the lender accounts. Examination of payment vouchers for the financial year ended 30 th June, 2012 revealed that Shs.18,750,000 was transferred to six (6) villages for the procurement of milling machines. The milling machines are yet to be procured. Our audit noted that the construction of irrigation scheme at Itaba village was not completed. 30 Mkinga DC There has been a delay in fund disbursement for about 181 days from the date funds were issued by Treasury to the time they were transferred to the respective projects. This hinders timely implementation of the planned projects. 31 Mpanda TC The Council entered into contract No.LGA/901/2011/2012/DADPS/W/01 with M/S Ndenengo Sengulo Ltd to construct 200 tones - Godown at Mbugani village at contract sum of Shs.61,221,860 with effect from 30/05/2012 to 30/07/2012. The subproject is not completed. 32 Mpwapwa DC During the year under review various ASDP projects worth Shs.173,966,000 were not completed leading to delaying provision of intended benefits to the targeted society. The Council had unspent balance of Shs. 569,988,841 as on 30th June, 2012 for Agricultural Sector Development A figure of Shs. 524,086, for cash and cash equivalent reported in the statement of financial position differs with Shs 569,988,841 of closing balance reported in fourth quarter report by Shs. 45,902, This misleads the users of financial statements. The Council management had a total requirement of 232 employees for Agriculture and Livestock Departments. The available number of employees was 57 thus leading to a shortage of 156 employees. 33 Mufindi DC A total amount of Shs. 80,000,000 was transferred to irrigation scheme account for two projects, each project at shs.40,000,000 from DADPs Fund. The program had not yet been implemented. There is shortage of 18 staffs in Agriculture department. 67

80 34 Muheza DC The Council through ASDP disbursed a sum of Shs. 20,000,000 vide payment voucher No.4/2 to Songa village. The purpose of funds transferred was to purchase a generator and build a generator shed. Subproject not yet done. 35 Muleba DC There were various prior years activities worth Shs.2,037,249,667 not cleared by the Council. The Council received a total of Shs.550,000,000 from the Treasury for the construction of Kyota irrigation scheme by M/s Mbesso Construction Co. Ltd vide contract No.LGA/037/2010/2011/MLB/W/14 at contract sum of Shs.441,591,150. However, the balance of Shs.108,408,850 was not reimbursed to the Treasury, and no any action plan was prepared by the Council to show how the balance will be utilized. Variation orders valued at Shs.60,886, were made and awarded to various contractors without approval from the Council Tender Board contrary to Public Procurement Regulation No.44 of 2005 (The Public Procurement-Goods, Works, Non-Consultant Service and Disposal of Public Assets by Tender) and Order No. 75 (b) (C) of the LAFM of The Council transferred a sum of Shs.252,822,000 to various villages from DASIP account to facilitate implementation of various projects such as rehabilitation of rural feeder roads, Procurement of a grain milling machine, construction of pit latrine and tables on Market sheds,however, up to September 2012 the activities had not been implemented. 36 Musoma MC Diverted fund amounting to Shs.10, 415,000 to NAEP accounts has not been accounted for. 37 Mwanga DC Unimplemented activities worth of Shs. 850, 551,342 or 80% under performance reflected project mismanagement by the Counci 38 Mwanza CC The Council was transferred Shs 21,161,000 to the community project groups accounts on 29/06/2012 (a delay of five months) contrary to Para.6.0 (vi) of DADPS guidelines (2011) which requires DADP funds to be transferred within 15 days 68

81 after received at the Council level. The delay has an impact on the implementation of the intended activities. The Council transferred a sum of Shs.22,700,000 to Buswelu Ward for construction of Artificial Insemination Centre (AIC). The construction was planned for seven weeks from 14 th May, 2012 to 31 st October, However, works amounting to Shs. 9,925,250 had not been completed as at the time of audit in spite the fact that the agreed contract period was already expired. Works amounted to Shs. 10,735,400 in respect of construction of SACCOS office at Buhongwa had not been completed as at the time of audit. The Council management attributed the delay with lack of contributions expected from the community. 39 Ngorongoro DC At the end of the year, activities amounting to Shs. 220,823,000 equivalent to 75% were not implemented despite the fact that funds were received on time. 40 Njombe DC The Council has a shortage of 37 staff in Agriculture department. There is no specific report issued in respect of Agriculture sector development programme contrary to Order No. 14 of Local Government Financial Memorandum (2009). 41 Njombe TC The Council granted a loan of Shs.5,018,800 to farmer groups for the purpose of assisting in irrigation activities. Payments were made vide PV No. 7/10, Cheque/Bank details No.NTC/NMB/VOLII/28, and supported with letter with reference No.NTC/AG/IRR/VOL.01/82 of 13/09/2011, the following shortfalls were noted; There was no loan agreement between council and the groups. The authority from the respective council committee was not obtained prior the issue of loan. According to the approved staffs establishment, Njombe Town has a shortage of 12 staff in Agriculture department. 42 Nzega DC VAT payment of Shs. 4,030,884 was made to TRA contrary to Memorandum of Understanding for the Establishment of Agriculture Sector Development Programme Basket Fund (ASDP) 69

82 of Budgeted funds not received for implementing planned activities worth Shs.261,474,933 as a result it adversely affected the project implementation by 87%. 43 Rungwe DC The review of financial statements submitted had no explanatory noted regarding deferred capital grant and Property, plant and equipment. Delay to submit financial statements for about 23 days after the statutory due date During audit of ASDP accounts it was revealed that, there was no evidence obtained indicating that the past year 20010/11 ASDP Fund audited report by the CAG was discussed by the Council Audit Committee The Council received Shs.810,000,000 from District Irrigation Development Fund (DIDF) as per third quarter report. The funds are not included in the Medium Term Expenditure Frame Work for 2011/2012 to 2013/2014. The fund was received on 14/02/2012 vide Receipt No Same DC Non-Disclosure of Accounts payables in the DADPS financial statement amounting to Shs.886, Sengerema DC There were various prior years activities worth Shs. 3,659,254,766. Audit evaluation of ASDP Budget for 2011/2012, Development Grant received and DADPS implementation report for fourth quarter of 2011/2012 revealed that, the Council received Shs. 50,786,000 for construction projects in various villages, however, as at the year end, the funds were not yet transferred to the respective village for the project implementation. This may lead to funds being used for unintended activities, thus lack of expected service to the Community. The implementation of the projects for Shs. 303,667,000 had not been started as required by the Council ASDP plan. The Council received fund from Treasury of Shs. 268,234,136 for implementation of ASDP activities, however, some of the 70

83 planned activities amounting to Shs. 101,554,000 were not implemented during the financial year plan of 2011/2012. The projects were not yet completed despite the fact that the agreed contract period had already expired. 46 Serengeti DC Planned projects worth Shs. 284,226,110 were not completed Uncompleted Resource Centre Phase II at Natta village worth Shs. 57,171,950 of which the council failed to charge liquidated damages of Shs. 4,859, to the contractor. Cattle trough worth Shs. 8,000,000 at Morotaga village was not yet constructed. 47 Shinyanga DC There was unutilized funds amounting to Shs. 39,744, which implies that some of planned activities were partially or not implemented at all. Outstanding payables as at October, 2012 were Shs. 2,479, which may affect the credibility of the Council and there is a possibility of losing potential customers or Council being sued. 48 Shinyanga MC Payments amounting to Shs.720,000 were not supported by relevant documents contrary to Order No. 8 (c) and 10 (2) (d) of the Local Authority Financial Memorandum (LAFM), There was unutilized funds amounting to Shs.75,622, which implies that some of the planned activities were partially or not implemented at all. Payments amounting to Shs. 1,860,000 were observed to be paid in the year under review being previous year s liabilities contrary to Order No. 22(1) of the LAFM, 2009 which requires expenditure properly be chargeable to the account of a year shall, if possible, be met within that year by raising a creditor if necessary, and under no circumstances will payment of a charge be deferred for the purpose of avoiding an over expenditure 49 Sikonge DC Unspent balance of Shs. Shs.672,032,580 equivalent to 63.8 %. The idle capacity at the level of 64% was a predicament to the programme development. 71

84 The Council management has not implemented recommendations on audit findings for Shs.871,244,040. There is a deficiency in the Department of 30 staff equal to 57% of total the requirement. This shortage affects the implementation of the agricultural activities in the District. 50 Singida DC The Council has unspent balance of Shs.244,033,180 equivalent to 27.5 % of the funds which was available for use for ASDP. Unutilized funds imply that some activities were either partially or not implemented at all. The Council made procurement of various goods and services and in the process it did not consider VAT exemptions amounting to Shs.11,450, in the related payments. Order 22 (1) of the LAFM, 2009 stipulates that, expenditure properly chargeable to the account of a year shall be met that year by raising a creditor and under no circumstances will payment of a charge be deferred for the purpose of avoiding an over expenditure. The Council entered into contract with M/S Azuruna Enterprises and General Merchandise for construction-contract No.LGA/116/2009/ 2010/DED/DALDO/W/O2 for a sum of 67,896,220. The project was expected to commence on 30/6/2010 and to be completed on 25/10/2010. However, as at the time of audit the contractual work had not been completed but liquidated damage amounting to Shs.6,789,622 was not imposed to the Contractor. Internal Audit Unit of the Council has not worked on progress of ASDP implemented activities as such periodic assessment of the effectiveness of systems of internal control on the ASDP activities was not performed contrary to the Memorandum of Understanding for the ASDP para Singida MC The Municipal Council has presented on the face of statement of financial performance Shs.35,254,600 expenses as Wages, Salaries and employee benefits in ASDP instead of allowances which does not provide reliable and relevant information contrary to IPSAS 1 Para 109. The Municipal Council has previous year outstanding audit matters related to ASDP of Shs. 31,463,426. During the year under review the Council awarded the contract 72

85 No LGA/115/SMC/2011/2012/C/No.1 for provision of Consultancy Service for Design, Supply, Installation and Commissioning of drip Irrigation Systems at Kisasida village to M/S Balton Tanzania Limited of Arusha for a contract sum of Shs. 500,000,000. Up to 30 th October, 2012 the work has not been completed and therefore delayed for 66 days The construction of modern abattoir at Manguajuki has not been completed as planned since the project was started in the financial year 2006/2007 and Shs.53,050,000 were spent up to the financial year 2009/2010 and there are no funds that has been budgeted by the Municipal Council for completion of the remained activities. The Municipal council has not disclosed significant accounting policies. There is inadequate presentation of information since the information on the overall financial results not included. 52 Songea MC Payments amounting to Shs.5,800,000 being fund transferred to Juhudi group by the Council, was not supported by acknowledgement receipt from the recipient of funds Shs.536,667 was paid to Matogoro Ward Development without being pre audited contrary to the Order No.10(2) of the LAFM, This implies there is weak internal control over authorization. 53 Tabora DC Payments without authority Shs.11,380,140. Expenditure charged to wrong accounting code Shs. 60,000, Tabora MC 55 Tarime DC Missing payment vouchers of Shs.3,818,475 Unreconciled items in Bank Reconciliations and Cash Book Shs.650,000 Council transferred a total sum of Shs 18,666,000 to six villag groups. Two (2) milling machines at Mkombozi group an Jikomboe group were delivered but installation has taken almost months, and four other milling machine at Borega A, Muriba and Muriba B were not delivered at all. The Council transferred Shs. 8,000,000 to Mogabiri in July

86 for construction of slaughter slab at Mogabiri village. This late transfer intended benefits to the Community. The activities which were planned to be implemented for th financial year 2011/2012 were not implemented to the tune of o Shs.321,041, Temeke MC There was a delay in transfer of fund from General Fund Account to DADPS account of Shs. 117,781,165 There were unimplemented planned activities totaling Shs. 116,638, Ukerewe DC There were unutilized funds worth Shs.146,786,000 indicating that some planned activities were partially or not implemented at all. The resource centre at Bukindo was not completed and the contractor was not at site. Also, a liquidated damage amounting to Shs.1,617,364 was not charged against the contractor despite of delay in the completion of the work. The Council incurred expenditure amounting to Shs.7,510,600 which was charged to wrong expenditure codes contrary to Order No. 23(1) of Local Authority Financial Memorandum (2009). 58 Urambo DC Procurement made without being subjected to quotations Shs.5,200,000 Payment made including an exempted VAT Shs.1,287,091 Expenditure charged to wrong Codes Shs.4,010, Moshi DC Activities worth Shs. 257,588,039 were unimplemented 60 Rufiji DC The Council transferred Shs 20,000,000 to Mapambano group for purchase of ten pregnant dairy cattle and construction of cattle shed.the dairy cattle is yet to be purchased. 61 Kibaha TC Cassava milling machine purchased for Shs. 9,022,000 was noted to have been kept idle at the Chairman residence. 62 Mkuranga DC Construction of Mwanzega godown at a contract price of Shs 74

87 39,498,500 not completed and the contractor was not at site. Msonga village entered into a contract with Msukwa General Enterprise for construction of a godown at a contract price of Shs. 40,982,304. The construction was noted to have been done at a slow pace and the contractor was not at site. The amount of Shs.316,364,671 was not spent as at 30 th June, Bagamoyo DC Activities valued at Shs.260,811,129 not implemented for two consecutive years Activities not implemented during the year Shs.596,874, Kabaha DC Planned activities worth Shs. 310,005,743 were not implemented during the year under review though the respective funds have been released. 65 Kisarawe DC Activities for Shs.43,331,630 remained unimplemented for two consecutive year s i.e from 2010/2011 to 2011/2012. In addition, activities valued at Shs.144,109,041 were also noted to have not been implemented during the year under review 2011/2012 though financial resources have been disbursed to implemented respective activities 66 Kilwa DC Two activities allocated with Shs.14,495,000 during a period under review were not implemented. The Council purchased working tools worth Shs.6,685,000.However, utilization particulars of the procured items could not be submitted for audit verification. The amount of Shs.16,430,000 was transferred to 6 village to implement poultry farming in February However up to August 2012 the projects were not completed. The Council lacked evidences for procured fuel worth Shs.7,971, Liwale DC The Council had a total amount of Shs. 1,665,403,332 out of which Shs. 782,742,611 was spent leaving a balance of Shs. 882,660,721. This signifies that activities of the same magnititude were not implemented. here is uncertainty on positive results for Ngongowele irrigation although an amount of Shs.992,785,358 have been 75

88 spent for implementation of this project 68 Lindi DC Rollover activities worth Shs.535,892,500 were not completed during the year ended June, This may results to cost overruns and hence require additional funds to complete respective projects. The council received Shs.331,211,452 against the budget of Shs.878,642,000 resulting into under release of Shs.547,430,548. Payments amounting to Shs.33,038,100 were made without having proper supporting documents contrary to order no. 5 (c) of LAFM Ruangwa DC Roll over activities amounting to Shs.45,326,061 relating to the financial year 2010/2011 were not completed during the financial year 2011/2012. Delays in completing planned activities may results to a cost overrun and hence a need for addition funds. The amount of Shs.208,169,998 were released by the Council to various wards for implementation of various planned activities. However, the funds were released toward the end of the year. No evidence that respective activities have been implemented. Activities worth 180,337,000 planned to be implemented by the Council could not being implemented, as no funds were released by the Treasury. This may affect the Council to meet ASDP over all objectives. 70 Lindi MC There is no proof that construction of main canal and distribution box worth Shs. 196,545,000 was executed satisfactorily. 71 Nachingwea DC Payments in respect of ASDP amounting to Shs.34,614,097 were made without proper supporting documentation The Council procured fuels worth Shs.4,472, but failed to record into stores ledgers There were delay more than five month in completion of rehabilitation of matekwe irrigation scheme Shs.369,636,430 Physical performance disclose uncompleted ASDP projects Shs.156,353,500 76

89 72 Mtwara Mikindani The Lwelu village production group lacked approval to procure 10 tonnes of sulphur for Shs.13,000,000 instead of cashew seedlings. No evidence that the approval to change use of funds was granted by Finance Committee and Full Council as stipulated under Order 18 of LGFM. 407 bags of Sulphur (25kg) each worth Shs.12,210,000 purchased without tender board approval contrary to Regulation No.68(4) of the Public Procurement Regulations, 2005 (Goods, Work, Non-consultant Services and Disposal of Public Assets by Tender (GN No.97). Six (6) chainsaw valued Shs.11,400,000 were procured without Tender Board approval. No evidence that the price offered is the most economical market price. 73 Masasi DC The Council has a total amount of Shs.651,867,134 during the year under review for implementation of Agriculture Sector Development Programme. Actual expenditure was Shs.345,756,591 leaving unspent balance of Shs.306,110,543 equivalent to 47% of the available funds. Under spending was caused by: (i) Some funds were received In June, 2012 from the Treasury thus they could not be utilized as approved in the annual budget. (ii) Late transfer of funds from Development account to the ASDP and from ASDP to the community groups/projects. (iii) Some of the contracts cross over to next accounting period. The Council received funds from Treasury through development account which are later transferred to respective account. It was observed that it took between 28 to 161 days to transfer funds from development account to ASDP accounts. Also it took nine days to three months to transfer funds from ASDP account to various projects implementers. This adversely affects implementation of planned activities. 74 Mtwara DC Total expenditure for the year was Shs.190,136, leaving a balance of Shs.421,695, or 69% of the available funds. This implies that activities of the same magnitude were not implemented and hence targeted objective was not achieved. 77

90 75 Tandahimba DC The amount of Shs.564,000,000 was transferred to finance two irrigation schemes at LIPALWE and LIHETU respectively. However, there is a possibility that the scheme will not be sustainable as it depends on rain running water.the scheme become dry for substantial period of time after rain season. Three projects allocated with Shs.111,133,690 were not implemented although financial resources have been disbursed to the respective villages. Delayed implementation of the projects can result into increase of implementation cost due to changes in price of material and overheads. 76 Nanyumbu DC The Council had unspent amount of Shs.67,028, representing 18% of the total funds of Shs.369,626, available during the year of. Unspent amount implies activities of the same magnitude were not completed. 77 Morogoro MC Contract agreement and documents for most of ASDP projects implemented at lower level are not maintained at the Municipal Council. Funds not disbursed to lower level amounting to Shs.54,443,000 Un-Implemented ASDP Projects at lower level up to 17 th September, 2012 Shs.8,616,724 The Council had annual budget of Shs. 127,255,316 but it received only Shs.81,455,316 leaving a balance Shs.45,800, Kilombero DC Mbingu village failed to procure power tiller worh Shs ,000 due to lack of community contribution to top up funds required to purchase a brand new power tiller. Warehouse worth Shs.40,000,000 not constructed at Miwangani The tractor worth Shs. 50,000,000 is yet to be procured by Chisano village The Council released a total amount of Shs.69,072,266 for construction of bridge at Mbingu but the village s meeting reallocated the fund for procurement of tractor. The tractor is yet to be procured. Non completion of Construction of Njage Small Holder Irrigation Scheme Sh.521,020,909 Non Completion of Construction of Zignal Small Holder 78

91 Irrigation Scheme Shs.398,181, Mvomero DC Payments not supported by relevant documents Shs.19,875,800 There are activities not implemented Shs.429,308, Kilosa DC Up to the date of audit (November, 2012) activities worth 528,789,780 were not implemented at lower level though funds were transferred to the respective lower level projects bank accounts. Disbursement from Ministry of Finance to Council takes 26 days to 132 days to transfer money received from development account to respective ASDP account. In the financial year 2009/2010 Kilosa District Council paid Shs.222,750,000 in respect of procurement of 50 power tiller from M/S Millystel Distributors Company. But only 15 power tillers out of 50 were distributed to villages and leaving 35 power tillers which are still not distributed as the quality of those power tillers is poor. 81 Ulanga DC Council planned to spend Shs 362,779,000 to implement ASDP activities. However, actual amount disbursed by the Treasury was Shs 322,987,000 resulting to under release of Shs 39,792,000. The Council transferred Shs 724,807,000 to lower level for implementation of various ASDP activities. However up to 30 th June, 2012 earmarked activities are yet to be implemented at lower level. 82 Namtumbo DC Exenditure amounting to Shs. 4,137,000/= were erroneously charged to wrong GFS codes. The Council paid Shs. 5,569,000 for meeting council expenses; however, the payments made were not pre-audited before authorization contrary to Order No. 10 (2) of the LGFM The Council paid a total amount of Shs. 6,339,000 for activities not related to the approved ASDP annual work plan. 79

92 (c) Councils issued with Qualified Opinion Out of the 132 Councils audited, 33 (23%) were issued with Qualified audit opinion as shown in the Table 35 below: Table 35: Councils Issued with Qualified Opinion 1 Babati DC Misstatement of depreciation charges amounting to Shs 969,000 Schedule of PPE has been overstated by Shs 17,180,000 The council did not adjust the surplus/deficit figure by Shs 16,211,000. District Council could not implement activities for Agricultural Sector Development Programme worth Shs 37,429, equivalent to 7.8 %. 2 Babati TC Over charging of depreciation to PPE relating to building by Shs.2,699, Bahi DC The opening balance of capital grant was understated by Shs 19,562,382 being amortization and depreciation charged in 2010/2011 in which the policy of the Council had not changed the accounting policy relating to property plant and equipment. Comparative figures for accounts receivables were understated by Shs.708,837,359 while accounts payable were understated by Shs.522,257,359. No adjustments were effected to correct this anomaly. There are inconsistencies in the application of an accounting policy relating to charging depreciation. There was no disclosure of the change in the financial statements and no adjustments were effected to account for errors resulting from previous incorrect use of the accounting policy. 4 Biharamulo DC Included in the financial statement is Shs. 107,742,000 transferred to lower level which is not yet utilized at the year end. Uncompleted slaughter house worth Shs. 18,821, abandoned at Nyakanazi village although 3 months has 80

93 elapsed after completion date of the contract. 5 Chamwino DC Payments amounting to Shs. 48,813,399 were noted to have no supporting documents which constitute limitation of audit scope. Payments amounting to Shs. 5,744,500 were made to settle prior year creditors who were not included in the prior year s creditors balance. Contracts worth Shs. 435,680,000 were not produced for audit. Failure to avail them has restricted the scope of our audit. It was noted during audit that, the consumption of diesel worth Shs. 4,588,750 was not accounted for implying that the noted fuel was probably misused. Several procurements worth Shs. 47,404,462 were noted to have been made without using competitive quotations. Failure in using quotations implies that the economic prices were not obtained. Procurement for goods worth Shs. 40,629,617 exceeded the threshold of Shs. 3,000,000 allowable without the Council Tender Board s approval. 6 Chunya DC Misstatement of cash and cash equivalent by Shs. 13,409,056 in the statement of financial position. 7 Dodoma MC The general ledger has been understated by Shs. 15,000,000 being Nane Nane contribution made to Central Zone. The Council did not show the supporting schedule for the reported balance of noncurrent assets amounting to Shs. 36,481,208. In the absence of the supporting schedule the reported noncurrent assets balance could not be verified. The Council did not disclose the significant accounting policies underlying the preparation of the financial statements. In the absence of accounting policies the determination of balances constituting the financial statements could not be established. The Council advanced loan amounting to Shs. 3,500,000 to one of Msalato development groups. As at the year end June 30 th 2012 recovery had not been made. 8 Ileje DC The following information as required to be reported in the IPSASs financial statements were not prepared: 81

94 Councilors Report, Statement of capital expenditure and its financing, Statement of changes in net assets, Statement of financial performance by function, Statement of comparison of budget and actual amounts by nature and function., Schedule of Noncurrent assets,. Note for Property, Plants and Equipments, and There were no Notes to support items in the statement of cash flow consequently; financial statements are not IPSAS compliant.. 9 Karagwe DC There is a difference between the previous years reported figures in the financial statement of 2010/2011 and the comparative figures of the same year presented in the DADPs financial statements for the year 2011/2012. The Council did not prepare the projects (DADPs & DASIP) cash flows statements which are compatible with the requirements of IPSAS as there was no Notes which form part of the accounts under which the financial statements were prepared 10 Kasulu DC Statement of financial position disclosed the figure for PPE of Shs. 1,059,502,015 while the amount disclosed in Note 29 is Shs. 1,775,249,312 as carrying value for road networks, bridges and culverts there is an understatement of Shs. 715,747, Kigoma Ujiji MC The Council disclosed property, plant and equipment of Shs. 35,000,000 in the Statement of Financial Position with note no 35. However, the referred to note 35 was not included in the financial statement The value of PPE reported in the comparative figure of year 2010/11 is Shs. 124,527 and the current year s balance is shown as Shs. 35,000,000 leading to a difference of Shs.89,527,000. However, despite existence of the difference noted, there is no evidence of disposal during the year and depreciation schedule for PPE was not prepared. Hence authenticity of the current year s PPE value could not be ascertained 82

95 12 Kilindi DC The opening balance figure for agriculture livestock extension system during the year was reported as Shs. 275,273,108 instead of Shs. 367,030,810 thus causing an understatement of Shs. 91,757,702. The Statement of Financial Performance of DADP s for the year under review reported a block figure of Shs. 258,005,803 as Agricultural, livestock, co-operative, fisheries and forestry instead of disclosing the expenditure line items that constitute the above figure of Shs. 258,005,803. Misstatement of deferred grant (Capital) of Shs.70,961,416 disclosed in the statement of financial position under Note 28.The figure was derived from wrong calculations made under Note 28. In addition, the deferred capital grant and the reported Non Current assets figure of Shs.165,519, could not be analyzed. 13 Kiteto DC Payment vouchers of Shs.2,237, were not made available for audit contrary to orders No. 368 and 369 of LAFM therefore authenticity of the expenditure could not be substantiated. 14 Kondoa DC Council s inventory amounting to Shs. 380,798,153 was not supported by stock taking sheets (stock sheets). In the absence of the stock taking sheets correctness of the reported figure could not be established. PPE was reported as Shs. 602,294,945 in the statement of financial position while a figure of Shs. 402,361,979 was disclosed under note 25 of the respective component thus leading to an overstatement of Shs. 199,932,966. Statement of financial position reported deferred income (capital grant) as Shs. 374,242,928 which was different with note 31 that showed a figure of Shs. 402,361,979 thus leading into the understatement by Shs. 28,119,051. Accumulated surplus has been misstated by Shs. 22,451,870 in the statement of financial position by comparing amount reported of Shs. 794,411,024 and that disclosed in the statement of change in net asset of Shs. 771,959,154 Net cash flow from operating activities in the statement of Cash flows was reported as Shs. 502,648,050 whereas the sum of items of cash flows from operating activities was Shs. 83

96 15 Kongwa DC 545,747,331 leading to an understatement of 43,099,281. Payment vouchers amounting to Shs. 30,588,047 were not supported by necessary supporting documents contrary to Order No. 34 of the Local Authority Financial Memorandum, Payment of VAT amounting to Shs.7,866,936 was made to contractors contrary to Section of the ASDP MoU of Payment that includes VAT reduces the amount of funds earmarked for activities in the ASDP. The statement of Financial Position includes PPE amounting to Shs.691,174,450 the details of which were supposed to be shown in Note 29. However, the note was neither included in the Financial Statements nor in the supporting schedule. The statement of Financial Position included Payables amounting to Shs.101,931,160 which had no explanatory notes. There was neither a note for PPE nor supporting schedule for the same. In the maintenance, there was an element of Physical infrastructure, amounting to Shs.179,656,650 and Technical equipments of Shs.4,556,000 which were not included in the PPE and depreciated/ amortized accordingly. Amount of Depreciation and amortization of Shs.220,750,991 was not correct due to the absence of supporting schedules and Note. Increase in trade and other receivables was reported as Shs.252,613,650 while there was neither receivables in the last year nor in the current year. Decrease in trade and other payables reported as Shs.31,862,660 could not be verified due to absence of supporting schedule 16 Korogwe DC The carrying value of Property, Plant and Equipment has been overstated by Shs. 24,197,378 due to misstatement of accumulated depreciation figure from the previous year by Shs.48,908,092 The deferred income figure was not correct as it included additions of Shs. 324,613,600 while in fact there were no additions as per PPE schedule. These additions were also wrongly shown in the cash flow statement. 84

97 17 Ludewa DC There is misstatement by Shs.407,351,792 in the cash flow statement. 18 Manyoni DC VAT amounting to Shs.72, 914,770 was paid to the contractor contrary to Section of the ASDP MoU of 2006 The Council paid Shs.3,362,500 to Council staff as tuition fee for studying Master degree at SUA University contrary to ASDP funds guide line of December, 2010 part Mbarali DC There was no disclosure of the depreciation policy/method used, to get the carrying value of PPE amounting to Shs.2,587,747,917 reported in the statement of financial position. Misstatement by Shs.359,115,704 in the Statement of Cash Flows. Financial statements are misstated by Shs.216,856, Mbeya CC A total amount of Shs.219,245,412 received by the Council for implementation of ASDP activities was not transferred from Development Account to DADPS Account. Subprojects worth Shs.108,790,000 were not implemented. 21 Mbeya DC Recurrent Grants and capital Grants understated by Shs.18,267,500. Shs.25,500,000 was drawn to meet unexplained expenditure out of Shs.208,100,000 amount transferred for Imezu village to implement construction of Irrigation Water Intake at Imezu village. Various assets for the projects were issued to one officer Gisela Banyenda so as to be used for project s activities. The assets were neither found at DALDO s office nor at the possession of the respective officer, hence misappropriation of Projects assets. 22 Mbozi DC Revenue received for ASDP activities as per cash flow statement was Shs.765,965,969 while the actual receipts for the year as 85

98 23 Missenyi DC evidenced by acknowledgement receipts was Shs.920,977,969 hence understating actual receipts by Shs.155,012,000 Cash and cash equivalent of Shs.676,209,280 reported in ASDP financial statements being balances from wards and villages was not supported by bank reconciliation statement. 24 Misungwi DC There were unutilized funds amounting to Shs.649,546,695 which implies that most of the planned activities were partially or not implemented at all. The trial balance reflected a debit balance of Shs 3,500,000 in respect of Sundry creditors. In normal accounting practices, sundry creditors should reflect credit balance. There is misstatement of Shs. 4,291,200 between allowances disclosed in the Statement of financial performance of Shs. 40,712,700 and the accounting note No.17 of Shs. 36,421,500 in the Council s trial balance. Misstatement of capital grant due to inclusion of loan recovery of motor cycles amounting to Shs.9,708,500 as revenue. 25 Monduli DC Improperly vouched expenditure Shs.24,279,720 Outstanding imprests issued to Council s staff Shs.240,000 Expenditure not related to ASDP activities Shs.2,909,000 Unadjusted opening balance by Shs.1,845,000 Missing payment vouchers Shs.10,061,468 Understatement of expenditure reported by Shs.1,845, Mpanda DC Other revenue reported in the statement of financial position at Shs.21,092,455 were not supported by the explanatory notes. Analysis for adjustments of Shs.434,821,564 was not submitted for review. Misstatement of amount of land and building by Shs.971,365,500 Agriculture Department-DADPS has Motorcycles worth Shs.197,365,000 but none has been reported in statement of financial position. 27 Ngara DC Cash and cash equivalents of Shs.371, 339,607 under Note 24 while the same Note under Councilors report showed 86

99 Shs.387,339,607 resulting into a difference of Shs. 16,000,000. In addition, the figure of unapplied capital as at the end of financial year showed the difference of Shs.31,040,000 between the DASIP financial statement and Councilor s report Out of Shs.251,540,000 received by Council in March 2012 for the implementation of DASIP projects in the Council only Shs.146,240,000 was transferred to village levels leaving the balance of Shs.105, 300,000 not yet disbursed to beneficiaries. 28 Nkasi DC The amortization of capital grant was overstated by Shs.1,796,706,238 in the statement of financial performance. Grants and other transfer payments of Shs.1,713,033,400 for the year 2012 have been expensed, instead of being capitalized. Notes on transactions disclosed in the cash flow statement have not been shown No surplus/(deficit) for year 2012 has been disclosed in the cash flow statement.however in the statement of financial performance, surplus/(deficit) for year is disclosed at Shs.7,397,359. The amortization of capital grant was overstated by Shs.1,796,706,238 in the cash flow statement. Misstatement of Development grant received by Shs.421,813, Pangani DC Grants refunded/transferred amounting to Shs.529,474, were not disclosed in the notes to the financial statements. Recurrent grants were shown in the financial statements as Shs. 469,199, while total funds available for projects amounted to Shs. 469,414, Statement of Financial Performance showed a deficit of Shs.36,762, while it was supposed to have no surplus/deficit. 30 Simanjiro DC Council s payments totaling Shs. 1,517,500 lacked supporting documents. Payment vouchers amounting to Shs. 1,265,000 were missing from their respective batches 87

100 The amount of property plant and equipment disclosed in the statement of financial position page no.15 included sh. 17,850,000 being procurement of power tillers for resale.such item is not part of PPE and should be disclosed as an inventory. Misstatements of Shs. 145,674,252 in the Cash flow statement During auditing the financial statement of ASDP for the year ended 30 th June 2012 resulted to the following misstatements in the statement of financial performance:- Total Recurrent grants presented as Shs. 242,082,285 while all fund available for the projects was Shs. 242,082,285 as per cash book report. This implies that financial performance included funds for development activities. Expenses in the statement of financial performance includes both capital and development expenses. Statement of financial performance presents a surplus of Shs. 407,122, while in actual fact the financial performance must have no surplus/deficit. 31 Songea DC Payment vouchers of Shs.25,176,000 were not supported with relevant supporting documents such as; signed pay sheets, night out claim forms and activity reports.in absence of the mentioned documents audit was not able to ascertain the authenticity of the expenditure. Expenditure amounting to Shs.4,329,000 was charged to wrong GFS Codes and no adjustment was made. Shs.805,000 was paid to five officers as night allowance. However the officers did not travel. 32 Kibondo DC Understatement of revenue by Shs.4,127,500 Overstatement of figures in the statement of changes in net assets Shs. 83,040,000 The imprest amounting to Shs 11,384,589 was noted to have not been accounted for. Grants not cross referenced with notes in the financial statement Misstatement of grants by Shs.95,042, Morogoro DC The carrying amount Deferred income capital grant at the end of the year was understated by Shs.901,820,000. Cash and cash equivalents at the beginning of both current and 88

101 previous year was posted as Shs.558,404,686 instead of Shs.536,697,616 as disclosed in note 23 cash and cash equivalent and resulted to overstatement by Shs.21,707,070. Expenditure amounting to Shs.4,437,000 were reflected in the cash books but the respective paid vouchers were not made available for audit examination contrary to Section 45 (5) of the Local Authority Finance Act No. 9 of 1982 (Revised 2000). Expenditure amounting to Shs.8,200,000 was not adequately supported by relevant supporting documents contrary to order No. 5(c) and 8(d) of the Local Government Financial Memorandum HEALTH BASKET FUND Introduction The Government of Tanzania has developed a framework to reform the health sector in order to improve the impact of health service delivery in the country. In order to promote, coordinated planning and implementation of services within the health sector, the Ministry of Health and Social Welfare and Prime Minister s Office Regional Administration and Local Government PMO-RALG in collaboration with Development Partners are engaged in a number of initiatives to upgrade health facilities and equipment through the Health Basket Fund arrangements. As part of the Health Sector Reform Programme and in order to promote coordinated planning and implementation of services within the health sector, the Government of Tanzania adopted a Sector-Wide approach to the provision of internally and externally obtained health sector resources. Under this approach, the Government and a group of its Development Partners, namely Royal Netherlands Embassy, DANIDA, Irish Aid, SDC, GTZ, KFW, UNFPA and the World Bank entered into a Sector- Wide Approach (SWAP) mechanism (including a Central Basket) for joint financing of selected areas of the MOH annual Plan of Activities (POA). In April 1999 the Government and the donors signed Joint Donor and Government of Tanzania Side Agreement in which they confirmed their commitment to 89

102 implement, in gradual and incremental way, the principles of sector wider approaches in order to achieve sustainable improvements in the health and well being of the people. The objective of the joint donor funding assistance is to support Tanzania s development efforts in the health sector. The donors supplement increased the annual health budget from US$ 1.25 to US$ 1.80 per capital as Health Basket Grant. (a) Four (4) Councils were issued with Unqualified Opinion without emphasis of matters Out of 132 Councils audited six (6) which is 3% were issued with unqualified audit opinion without emphasis of matters as shown in Table 35 below: Table 35: Councils issued with Unqualified Opinion without emphasis of matters No. Council 1 Tanga CC 2 Chamwino DC 3 Mbozi DC 4 Kinondoni MC 5 Masasi DC 6 Mtwara MC (a) Ninety four (94) Councils were issued with Unqualified Opinion with Emphasis of Matters as shown in Table 36 below: Out of 132 Councils audited ninety four (94) which is 71% were issued with unqualified audit opinion with Emphasis of Matter as shown in Table 36 below: 90

103 Table 36: Councils issued with Unqualified Opinion with Emphasis of Matter 1. Musoma DC There was unspent balance of Shs.27,902, for activities planned to be implemented during the year 2011/2012, this implies a delay in achieving expected benefits. Audit review of the annual implementation progress report conducted on October, 2012 noted that, some of the planned activities worth Shs.149,647,840 were not implemented or partially implemented as planned. 2. Bunda DC There was unspent balance of Shs. 79,782, for activities planned to be implemented during the year 2011/2012, this implies a delay in achieving expected benefits. Payments amounting to Shs. 12,060,000 were made to DED -Bunda to meet various Council activities without either producing the activity report, acknowledgement receipt or indicating the period on which the activities were conducted, contrary to Order No.8 (2)(c) of the LAFM 2009 Scrutiny of the annual implementation report for the year under review noted that, activities worth Shs. 75,521,000 were not completed as planned, leading to a continued delay in achieving expected benefits. 3. Musoma MC Site visit made in December, 2012 revealed that one Delivery kit worth Shs.750,000 and one HB Machine worth Shs.1,400,000 which were issued to Nyasho and Bweri Heath centres respectively were not in use. Verification of Combined Performance technical Progress and financial report for the year ended June, 2012 revealed that, expenditure worth Shs. 18,671,849 for various activities were made in excess of what was budgeted. 91

104 4. Hai DC Comparison made between prices quoted for procured essential medicines, diagnostics and hospital supplies out of MSD against prices as MSD price catalogue of 2011/12 revealed that the procured items out of MSD exceeded MSD prices by Shs 3,354, Serengeti DC During audit for the year under review, we noted that, Serengeti District Council s Internal Auditor does not conduct specific audits in respect of Health Basket Fund (HBF) as required by MOU. In addition, there was no evidence of audit risk assessment carried out to identify risk areas During site visit made on 9 th Sept 2012 it was observed that windows of RCH B were not fixed, painting was not done and toilet was not constructed. 6. Rorya DC Activities worth Shs.23,380,000 of previous years were not implemented, implying a continued delay in expected benefits to the Community. Sum of Shs.110,312,423 remained unutilized for the year 2011/2012. This implies that annual plan of activities was not effectively discharged and hence continued delay in delivering of service Payments amounting to Shs. 7,550,000 were not adequately supported with relevant documents contrary to Order No. 8 (2)(c) of LAFM of In the absence of the supporting documents validity of the payments could not be established. Budgeted activities worth Shs. 178,715,412 were not implemented. 7. Bukombe DC The attitude of not responding to the auditor s observations and recommendation may lead to the recurrence of same anomalies observed by the auditors in subsequent years. There was unspent balance of Shs. 185,246, for the year under review, implying that, annual plan under the Health Basket Fund was not effectively discharged 92

105 and activities of the same magnitude which were to be implemented during the period under review were postponed; this may bring about budget revision for the forthcoming period to accommodate possible price fluctuations and effects of inflation. Payments amounting to Shs. 6,130,000 were not supported with relevant documents which is contrary to Order No. 8 (2) (c) and 10 (2) (d) of the Local Authority Financial Memorandum of In the absence of relevant supporting documents validity of these payments could not be confirmed. Payment Voucher worth Shs 3,362,000 which was recorded in cash book, was not produced for audit scrutiny. In this event the nature of the expenditure incurred by the Council could not be verified. Bukombe District Council purchased and paid for hospital items amounting to Shs.7,217,000 which were not confirmed to be received by the user department. In the circumstances there is possibility that council s stores are lost without the awareness of the Management. 8. Bariadi DC Payments amounting to Shs. 9,252, were observed to have been paid in the year under review in respect of previous year s liabilities and no proofs that the same payments formed part of the 2010/2011Councils creditors approved to be paid in the year 2011/2012. This is contrary to Order No.46 of the Local Authority Financial Memorandum (LAFM), Call of orders made for purchases of goods and services amounting to Shs.41,751,950 were not signed by the Accounting Officer contrary to Order No. 10 (2)(a) of the Local Authority Financial Memorandum (LAFM), Effecting payments before authorization by the Accounting officer may result to loss or misappropriation of Council funds. Audit sites visited during the year under review noted seven (7) construction works to have not been completed and were in progress though their contractual periods were already expired and there were no evidences produced to confirm whether the Council had 93

106 granted extension of time to the contractor. In this circumstance, Community has not derived the expected benefits. During audit review we noted that there was no specific internal audit report issued on activities undertaken through Health Basket Fund within the District, contrary to Order No. 14 of the Local Authority Financial Memorandum (LAFM), 2009 implying that, the coverage of internal audit was inadequate. Contrary to Regulation No. 116 of the Public Procurement Regulation 2005, copies of contract documents were delayed to be submitted to the Controller and Auditor General s Regional Office for 51 to 90 days. The Council incurred expenditure amounting to Shs. 5,544, for the purchases of goods and services without inviting competitive quotations. In this event, it could not be confirmed that the prices paid represent the best value for money contrary to Regulation 4(2) (b) and First Schedule of the Local Government Authorities Tender Boards Regulations, Kishapu DC Audit of Exchequer Issue Notification from the Regional Administrative Secretariat-RAS for the financial year 2011/12, noted that Shs. 19,407,100 was released to the Kishapu District Council for implementation of HBF activities. However, review of bank statements, cash book and receipt books noted that the same was not received by Kishapu District Council. Audit of expenditure particulars and other related documents noted that, Shs. 1,291, was paid to Ally Hamad Hillal being payment for purchase of diesel for official use. However the same activity No.86 was already paid for. Audit of payment vouchers and other related documents revealed that, a total of Shs. 111,733,050 was transferred to the Regional Medical Officer for implementation of various activities. However as at the time of audit, these funds were yet to be retired. 94

107 Review of Council HBF Annual Technical and Financial Progress Reports for the year under review has revealed that, the activities which were planned to be implemented for the financial year 2011/2012 were not implemented to the tune of Shs.242,758,974 thus the earmarked services/benefits to the intended community have been delayed. This may also bring about budget revision to accommodate possible price fluctuations due to effects of inflation. A test check of payment vouchers and procurement records for Financial year under review, revealed payments amounting to Tshs. 1,800,000 were made to Ms Frasa General Supply being payment for fumigation services basing on only one quotation contrary to part (a) of the First Schedule of the PPR, Maswa DC Shs. 7,110,000 was paid to M/s Kasimwa General Supplies in respect of purchasing medical supplies. However, payments were not supported by relevant documents contrary to Order No.8 (2) (c) of the Local Authority Financial Memorandum (LAFM),2009 which stipulates that, the treasurer shall be responsible for maintaining a sound accounting system and the safekeeping of all supporting records. 11 Meatu DC Payments amounting to Shs. 6,468,000 were not supported with related documents contrary to Order No.8 (2) (c) of the Local Authority Financial Memorandum (LAFM), Payment vouchers worth Shs. 12,525,000 were not produced for audit scrutiny when called for contrary to Order No.8 (2) (c) of the Local Authority Financial Memorandum (LAFM), Validity of payments made could not be verified and ascertained. Audit of council budget and other related documents for the year under review revealed that, expenditure incurred amounting to Shs. 38,421,000 were out of the approved budgets. This was incurred without seeking any authorization which is contrary to Section 10(3) of the 95

108 Local Government Finances Act, No. 9 of 1982(Revised 2000). There was unutilized funds amounting to Shs. 115,400,421 which imply that some planned activities of the same magnitude were partially or not implemented at all, thus the earmarked services/benefits to the intended community have been delayed. 12 Kahama DC 96

109 During the previous year s audit, several recommendations were made on major findings, which required management s necessary attention and action for improvement. Most of the recommendations raised amounting to Shs.119,023,875 were not implemented. Non response to auditor s recommendations may lead to the recurrence of the same anomalies in subsequent years. There was unspent balance of Shs.39,567,492 for activities planned to be implemented during the year 2011/2012, this implies a delay in achieving expected benefits. Shs.6,776,600 being special imprest was issued to Peter D. Magohe for purchase of Ltrs Diesel fuel & 200 Ltrs Petrol. This is contrary to Order No.69 (1) of the Local Authority Financial Memorandum (LAFM), The situation may lead to possibility of misappropriation of fund and Value for Money on the goods procured might not be obtained. A scrutiny of the Statement of Comparison of Budget and Actual - by nature revealed that Shs 68,320,765 was spent over and above the approved budget; and approval for a supplementary budget was not confirmed during our audit. The situation implies inadequate sound management over financial resources. Project performance revealed activities worth Shs. 70,999,902 were either partly completed or not implemented. This leads to delay in delivery of expected benefits to the Community and accumulation of activities in the financial year 2012/2013. We noted outstanding items in the bank reconciliation statements of Shs. 80,616, since 30 th June, 2012 to December This is contrary to Order No.29 (2) of the Local Authority Financial Memorandum of 2009 which requires the Council s Treasurer to ensure that all necessary reconciliations are carried out at not more than monthly intervals. 97

110 13 Shinyanga DC During the previous year s audit, several recommendations were made on major findings, which required management s necessary attention and action for improvement. The recommendations raised amounting to Shs. 72,315,470 was not implemented. Non response to auditor s recommendations may lead to the recurrence of the same anomalies in subsequent years. A test check of payments for the year under review disclosed payment worth Shs. 19,560,000 not supported by relevant supporting documents such as acknowledgement receipts, contrary to Order No. 8 (2) (c) of the LAFM In the absence of relevant supporting documents, validity of the payments could not be confirmed. Shs. 81,299,825 was issued to the Regional Medical Officer (RMO) for implementation of various planned activities being Basket funds to the RMO for the 3 rd and 4 th quarter for the year 2011/2012. However as at the time of audit (November, 2012), these funds were yet to be retired. Delay in submission of retirement particulars may conceal misappropriation of funds issued. Payments amounting to Shs. 12,000,000 advanced from Health Basket Fund to meet other charges in the Health Account. However up to November, 2012, it was noted that the amount of Shs.12,000,000 was not refunded to Health Basket Fund to meet planned activities as intended. The payment of Shs. 30,907,900 made to M/s Magira Pharmacy, being Costs for supplies of Hospital & Medical equipments were basing on only one quotation contrary to part (a) of the first schedule of the PPR,2005. Procurements done without competition may cause the Council to procure goods and services with low quality. Audit of procurement transactions revealed that a sum of Shs. 10,465,000 were paid to suppliers who were not in the list of approved suppliers for the year under review nor in those appointed and approved by the Government Procurements and Suppliers Agency (GPSA), 98

111 contrary to Regulation No.63 (3) of Public Procurement Act of 2004 together with Order No. 74 of Local Authority Financial Memorandum (LAFM) of Shinyanga MC 15 Magu DC Payments of Shs. 7,311, were paid in the year 2011/2012 in respect of previous year s liabilities, and there were no proofs that the same payments formed part of the 2010/2011 Councils creditors and approved to be paid in the year 2011/2012.This is contrary to Order No.22(1) of the Local Authority Financial Memorandum (LAFM), 2009; Up to 30 th June 2012 the council has unspent balance of Shs. 273,528,227 equivalents to 27% indicating that the Council spent only Shs. 737,951,738 or 73% of the available Health Basket Funds. We noted payments amounting to Shs. 31,538,000 were made without being supported by the Hospital Therapeutic Committee statement/report to confirm the receipt of that medical drugs/equipment. Also, procurement was made without prior approval from the Tender board contrary to Regulation 68(2)(5) of the Public Procurement Regulations G.N No ,and Comprehensive Council Health Plan Guidelines,2007 (chapter III para.3.5(h) 16 Mwanza CC Payments amounting to Shs. 10,387,500 from Health Basket Fund account were not supported by relevant document contrary to the Public Finance Regulation. Reg.95 (4) of 2001 (Revised 2004) and Order No. 8 (2) (c) of the Local Authority Financial Memorandum Audit of payment vouchers and other related documents revealed an overpayment of Shs.1, 010,000 to M/S Msua Pharmacy and Megatech Construction Co. Ltd. This resulted into a loss of Public funds to the tune of Shs. 1, 010,000. Audit of Exchequer Issue Notification No. 81/EB/AG/159/11/811 and Release warrant No.1043 dated 14/6/2012 from the Regional Administrative 99

112 Secretariat-RAS for the Financial year 2011/12, noted that Shs.35,588,900 were released to the Mwanza City Council for implementation of Health Basket Funds activities but was not receipted by the Council. Drugs and hospital supplies worth Shs. 71,806,500 were purchased from private suppliers without approval of Medical Store Department, contrary to Regulation No.57 of the Public Procurement Regulations, 2005 (goods, works, non consultant services and disposal of public assets by Tender). Audit of Invoice, delivery notes, and store receipt vouchers in comparison with LPOs disclosed Medicines and Medical Supplies amounting to Shs. 109,101,100 to have neither delivered by Medical Store Department (MSD) not received by Mwanza City Council contrary to Order 59(1)-(2) of Local Authority Financial Memorandum Arusha DC Up to 30 th June 2012 there was an unspent balance of Shs. 5,686, equivalent to 0.8% indicating that the Council spent only Shs. 674,497, or 99.2% 18 Moshi MC Moshi Municipal Council planned to implement 111 activities valued at Shs.315, 020, through Basket Fund. However, out of the 111 activities, 97 activities were implemented and 14 activities amounting Shs. 31,192, were not implemented. 19 Hai DC Up to 30 th June 2012 there was unspent balance of Shs. 2,955, equivalent to 0.67% indicating that the Council spent only Shs. 436,440, or Comparison made between prices quoted for procured essential medicines, diagnostics and hospital supplies out of MSD against prices as MSD price catalogue of 2011/12 revealed that the procured items out of MSD exceeded MSD prices by Shs 3,354, Arusha MC There was unutilized fund amounting to Shs. 118,217, which imply that some planned activities were not implemented at all, thus the earmarked service 100

113 to the intended community have been delayed. Payment by cash amounting to Shs. 2,095,000 was used to procure various goods instead of cheque as required by Order No. 68 of the Local Authority Financial Memorandum of Council procured hospital equipments with a value of Shs. 47,570,500 from suppliers other than Medical Stores Department (MSD) contrary to Section 51 of PPA, Karatu DC The council purchased medical supplies of Shs 10,022,500 from unauthorized suppliers contrary to section 51 of Public Procurement Act, 2004 There is a possibility that the Council procured substandard items for the hospital supplies. Expenditure amounting to Shs 230,000 was not supported by adequate documents contrary to Order No. 8 (c) of Local Authority Financial Memorandum 2009; in that case the validity of expenditure could not be ascertained. During audit it was noted that, the Council did not keep Vote Books to enable easy tracking of different sources of funds (receipts) and control of payments (Expenditure to be in line with budget line) contrary to Order No. 23 (2) of LAFM The Council disbursed funds from Health Basket Fund to Oldean village for maintenance of one staff house, two Wards and Dental clinic at Oldean Health Centre for the financial year 2011/2012. However, the project has not been implemented despite the fact that the funds were received by the Council. 22 Mkinga DC 23 Meru DC Up to 30 th June 2012 there was unspent balance of Shs 68,247,981 equivalent to 19% which imply that some planned activities were not implemented at all, thus the earmarked service to the intended community have been delayed. Shs.1,002,150 was issued to an employee of the Council as special imprest for purchasing various Items/equipment during national vaccination day. But 101

114 this should have been made by use of the Local Purchase Order and issuing direct cheque to the supplier. Cash amounting to Shs.36,702,050 was paid to various staff at Nkoaranga Hospital while meeting various expenditures after being drawn from the hospital bank account ( ), instead of using LPOs as the normal course of procurement procedures and subsequently payment is settled by using cheques. Drugs worth Shs.18,138,250 were procured from unauthorized supplier, instead of being procured from Medical Stores Department. No evidence was given from Nkoaranga Hospital to substantiate that, the drugs and medicine procured were out of stock from Medical Store Department. Payments for renovation of RCH building of Shs.6,637,500 and Shs.2,247,500 respectively made by Nkoaranga Hospital to Nomaki Builder Ltd, competitive tender procedures were not followed to obtain the most economic price as stipulated. Payments amounting to Shs.1, 245,000 had no relevant document to support the genuineness of various expenditure made by the council. 24 Moshi DC Out of the planned activities, activities worth Shs. 916,097,370 were either full implemented or partially implemented; leaving activities worth Shs. 332,636,429 unimplemented. Comparison made between prices quoted for procured essential medicines, diagnostics and hospital supplies out of MSD against prices as MSD price catalogue of 2011/12 revealed that the procured items out of MSD exceeded MSD prices by Shs 7,654,400. Under this circumstances government might lose public funds due to non comparison of prices quoted by suppliers with MSD catalogue by procuring entity. 25 Mwanga DC Comparison made between prices quoted for procured essential medicines, diagnostics and hospital supplies out of MSD against prices as MSD price catalogue of 2011/12 revealed that the procured items out of MSD exceeded 102

115 MSD prices by Shs. 22,752,550 Under these circumstances government might lose public funds due to non comparison of prices quoted by suppliers with MSD catalogue by procuring entity. 26 Biharamulo DC An amount of Shs. 179,511, was released to the Council through Exchequer Issue Notification No. 87/EB/AG/159/11/245 dated 3/11/2011 and Warrant of Fund No. 220 of 2011 for the first and second quarters of the financial year 2011/2012. However, the fund was received by the Council on November 2011 through receipt no of 23/11/2011 which indicates that Council has survived five (5) months without Health Basket funds to cover the planned activities. Council Management signed a contract with M/s Alex Madoo Isaay of Biharamulo for collection of waste disposal from various centres within the Biharamulo Township whereas, the contract was to expire on 30 th June, 2012 for Shs. 3,250,000 payable per month. However, there was no budget under the Health Basket Fund for such activity. 27 Chato DC The intended Health Basket Funds (HBF) activities amounting to Shs.163,858,788 equivalent to 36% were not implemented for the year ended 30 th June,2012 and thus the beneficiaries denied services resulting from non completion of the approved activities. A total amount of Shs. 141,270,675 was received in Development account on 28 th May, 2012 for Health Basket Fund activities but was not transferred to Health Department account. The fund remained in Development account as at 30 th June, Biharamulo DC An amount of Shs. 179,511, was released to the Council through Exchequer Issue Notification No. 87/EB/AG/159/11/245 dated 3/11/2011 and Warrant of Fund No. 220 of 2011 for the first and second quarter of the financial year 2011/2012. However, the fund was received by the Council on November 2011 through 103

116 receipt no of 23/11/2011 which indicates that Council has survived five (5) months without Health Basket funds to cover the planned activities. Council Management entered in a contract with M/s Alex Madoo Isaay of Biharamulo for collection of waste disposal from various centres within the Biharamulo Township. The contract was to expire on 30 th June, 2012 for Shs. 3,250,000 payable per month.however, there was no budget under the Health Basket Fund for such activity. 29 Bukoba DC The intended Health Basket Fund (HBF) activities amounting to Shs.64,843,438 equivalent to 11% were not implemented for the year ended 30 th June,2012 and thus the beneficiaries were denied services due to non completion of the activities. 30 Ngara DC During the year under review, Shs.147,028,650 was received by the Council on 26/01/2012 for implementation of various Health Sector Basket Fund activities via Council s Development bank account. Thereafter, the same amount was transferred to Health Account on 16/05/2012 resulting into delay of four (4) months. The intended Health Basket Funds (HBF) activities amounting to Shs. 119,173,996 equivalent to 14% were not implemented for the year ended 30 th June,2012 and thus the beneficiaries denied services resulting from non completion of the approved activities. Council procured different goods valued at Shs. 202,231, during the year under review but it could not be ascertained in audit on whether goods/works procured were inspected by the Inspection and Acceptance Committee before put into use contrary to Regulation 127 of the Public Procurement Regulation, 2005 A sum of Shs. 25,388, was spent for the procurement of medical supplies and equipments from private suppliers other than Medical Stores Department (MSD). The Council did not obtain current stock status 104

117 from MSD (a government agency officially selected to supply medical supplies and equipments) as at the time of purchase. The Council incurred payments aggregating to Shs. 58,757,035 for procurement of fuel from Health Sector Basket Fund for undertaking different health activities. However evidences of fuel consumption i.e. Motor vehicle logbooks were not made available for audit review, we noted that the Council does not maintain motor vehicles log books to confirm the consumption of procured fuels. 31 Karagwe DC Previous Years auditors recommendations not implemented Shs. 693,874,551 During the year under review, Shs. 241,106, was received by the Council from Treasury on 26/01/2012 for various Health Sector Basket Fund activities via Council s Development bank account. Thereafter, the same amount was transferred to Health Account on 08/03/2012 resulting into delay for 42 days. During the year under review the Council spent Shs.157,753,609 for implementation of various HBF activities which remained unimplemented in the year 2010/2011. The balance of funds for these activities at the end of year 2010/2011 was Shs. 107,833,880, hence implementation of these activities exceeded available balance by Shs.49,919,730. Our audit comparison between what has been reported in the Councilor s report and recalculated audit figure Financial performance noted contracting information concerning grants received for HBF activities during the financial year under review resulting into a difference of Shs. 150,962, Misenyi DC The intended Health Basket Funds (HBF) activities amounting to Shs.56,467,677 equivalent to 14% were not implemented for the year ended 30 th June,2012. Beneficiaries were therefore denied services resulting from non completion of the approved activities. Payments valued at Shs. 22,718, which were made 105

118 to DED-Missenyi in respect of allowances during the implementation of Health Basket fund activities were not properly supported with relevant documents. Payments amounting to Shs.13,654,944 were made to various private garages without routing the Council s vehicles to TEMESA (Government workshop/garage) for repair.there was no documentary evidence to confirm inability of the TEMESA to repair Council s vehicle. 33 Bagamoyo DC Order No.5(c) of LAFM (1997) requires all payments to be properly supported by relevant documents. However, to the contrary, the Council paid Shs. 7,465,000 for various activities without adequate supporting documents. A revew of the Council Health Basket Fund budget and fourth quarter progress report revealed that the Council failed to implement activities amounting to Shs. 109,810,554 which represent 18% of the total funds released during the year under review. 34 Kibaha DC Review of the fourth quarter progress report revealed that the Council failed to implement activities amounting to Shs. 8,690,981 which represent 15% of the total funds released during the year under review. 35 Kibaha TC The Council procured hospital equipments amounting to Shs. 27,363,530 outside MSD for distribution to various Health Centers within the District. This is contrary to Sec. 4 (2) of MSD Act of

119 36 Rufiji DC Scrutiny of the payment vouchers noted expenditure amounting to Shs. 23, 842,483 without supporting documents such as acknowledgement receipts, signed paylists and application letters, contrary to Order No.34 (1) of the Local Authority Financial Memorandum, Examination of payment vouchers for the year under review revealed payments amounting to Shs. 19,173,000 made to various suppliers for purchase of fuel for Council use. However, utilization account of fuel i.e issue vouchers and log books was not made available from user department despite several requests. Order No.34 (1) of LAFM, 2004(revised2010) requires the Council to maintain a sound accounting system and safekeeping of all supporting documents and records. However, during the year under review, payment vouchers amounting to Shs. 4,306,900 were missing from their respective batches. 107

120 37 Kisarawe DC Review of Council action plan under Health Basket Fund noted that planned activities worth Shs. 69,295,000 which were planned to be executed during the year under review 2011/2012 were not implemented. Total payments of Shs. 16,084,050 were made for the purchase of various goods and services. However, it was noted that, the expenditure was not inline with the approved budget under Basket Fund Programme. This led to excess expenditure of the same amount contrary to Order No. 44 of the Local Authority Financial Memorandum Payment vouchers with values of Shs. 31,249,082 were lacking various supporting documents such as ordering documents, invoices delivery note, distribution lists and acknowledgement receipts. 38 Mafia DC Review of the fourth quarter progress report revealed that the Council failed to implement activities amounting to Shs. 4,964,700 which represent 4% of the total funds released during the year under review. The council paid a total sum of Shs. 24,768,535 for procurement of medicine and hospital equipments without being approved by the Council Tender Board Stores purchased and paid for worth Shs.11, 073,530 was not traced to have been taken into ledger charge. 39 Mkuranga DC Scrutiny of the fourth quarter progress report prepared by the Council showed planned activities valued at Shs. 37,685,697 had not been implemented as planned. 40 Bukoba MC Audit of the Council procurement documents together with list of suppliers for financial year 2011/2012 approved by Council and GPSA has noted that, the Council management made procurement from suppliers who were not short listed by GPSA worth Shs. 16,789, Manyoni DC The Council paid the amount of Shs. 15,384,700 to MSD for the supply of medicine but medicine worth Shs. 7, 108

121 244,700 only was received by the Council.The balance of medicine worth Shs. 8,140,000 was not received from MSD which means that funds were used for service not received. 42 Dodoma MC The Financial Statements did not include the Statements of Change in Net Assets/Equity There was understatement of Shs.145,836,796 resulting from the difference between the balance reported on the cash flow statement and statement of financial position of Shs.30,985,327 cash and cash equivalent at the end of the period (30 th June 2012). However the balance verified on the bank statement was Shs. 176,822, During the review of Cash flows Statement it was noted that there was an increase in payables of Shs. 671,302,059 reported.however this increase was not reported in the current year s or in the pprevious years Statement of Financial Position. In this respect it could not be justified how the council came up with the reported increase in payables in the Cash flows Statement It was noted that the Municipal Council paid for supplies worth Shs.7,037,995 under Health Basket Fund which were raised in the year 2010/2011. Furthermore, the paid creditors were not disclosed in the previous year s Financial Position ( for the year ended 30 th June, 2011).Payment amounting to Shs.12,427,000 were not adequately supported contrary to Order 34(1) of the Local Authority Financial Memorandum, (2009) 43 Igunga DC Review of the quarterly progress reports for the period ended 30 th June, 2012 noted that the activities with a value of Ths.106,521,523 were not implemented while activities with a value of Shs.145,874,150 were implemented below 50%. 109

122 44 Kondoa DC The Internal Audit Unit did not conduct and report separately on implementation of HBF activities for the financial year ended 30 th June, A total of Shs. 30,868,126 was paid to clear the Council s outstanding liabilities related to the previous financial years contrary to Order 22(1) of LAFM, This has an impact of distorting the budgetary controls. Kondoa District Council bought diesel from Kondoa Service Station and WP & D Company amounting to Shs.3,896,623 for prices above those issued by EWURA. 45 Magu DC Up to 30 th June 2012 there was an unspent balance of Shs. 273,528,227 equivalents to 27% (indicating that the Council spent only Shs. 737,951,738 or 73%) of the available Health Basket Funds. Payments amounting to Shs. 31,538,000 were made without being supported by the Hospital Therapeutic Committee statement/report to confirm the receipt of the medical drugs/equipment. Also, procurement was made without prior approval from the Tender board contrary to Regulation 68(2)(5) of the Public Procurement Regulations G.N No ,and Comprehensive Council Health Plan Guidelines,2007 (chapter III para.3.5(h). Furthermore, payments were made from the financial year 2011/2012 in respect of 2010/2011 debts. 46 Same DC There was unutilized fund amounting to Shs. 70,121,466 which imply that some planned activities were not implemented at all, thus the earmarked service to the intended community have been delayed. 47 Siha DC There was unutilized fund amounting to Shs. 25,472,562 which imply that some planned activities were not implemented at all, thus the earmarked service to the intended community have been delayed. Quoted prices for procurement of medicines and hospital supplies exceeds MSD price catalogue by Shs. 2,979,

123 48 Chunya DC Health Basket Fund projects were not reviewed by the Council s Audit Committee Expenditure made out of Budget Shs 6,300,000. Emergence Procurement of Goods done but goods are still in Store Shs. 2,410, Procurement of Goods and Service through Special Imprest Shs.4,630, Rungwe DC Understatement of figure of cash and cash equivalents 31,959,220. Non disclosure of important/ useful information in the notes Cash flow statement disclosed shs 9,736,100 as cash flow from operating activities.however,the item disclosed is contrary to the IPSAs cash flow statement presentation frame work. The Cash flow statement disclosed shs 9,736,100 as surplus/deficit before taxation, but according to the statement of financial performance, the surplus/deficit for the year was zero. The cash flow statement disclosed shs.77,349,500 as increase in trade and other receivables.however,according to the statement of financial position there was no trade and other receivables for the year ended 30/6/ Iringa DC According to the approved staffs establishment Iringa District Council was required to have a total of 423 staffs for smooth operations of the Health Sector activities. However it was noted that, the actual number of staff had a shortage of 157 staff. The under staffing was caused by lack of authority to employ more Health staff in order to be in line with limitations set in the council s establishment plan for the year under review. This implies that, the Council objectives cannot be achieved due to inadequate number of Health Sector staff. 111

124 51 Kilolo DC Imprest amounting to Shs.2,422,000 was still outstanding as at the time of audit. This may lead to misappropriation of council funds. The council purchased drugs worth Shs.567,700 vide PV No.154, and Cheque No from Medical Stores Department. However, neither Delivery Notes, Ledger Folio References nor physical existence of purchased and paid for items were made available for audit verification. This implies that the purchased goods may be misappropriated. According to the approved staff establishment, Kilolo District Council was required to have 464 staff in order for smooth operations of the Health Sector activities at the Council. However, as at the time of audit, the total number of available staff was 248, resulting to a shortage of 216 staff. Shortage of staffing in Health Sector Department may lead to difficulties in implementing health basket fund activities. Imprests amounting to Shs.34,674,300 were outstanding for long periods of time Contrary to Order No.40(3) of the LGFM of Imprests amounting to Shs.24,953,500 were issued prior to the clearance of previous imprests contrary to Order No.40(4) of LGFM of Non retirement of imprests implies that there is a high risk of imprests issued being misappropriated. A sum of Shs.25,970,700 was paid for maintenance of motor vehicles. However, inspection was not done made before and after vehicle s maintenance to ascertain the validity of service delivered contrary to Order No.70 of the LGFM of This implies a possibility of vehicles maintenance was done contrary to the request of the user department or be fitted with spare parts which are not genuine. Imprest amounting to Shs.17,405,000 was issued to 112

125 various officers for the purpose of conducting supportive supervision to various health centers. Scrutiny of the retirement particulars noted that, the retirement particulars were not supported by activity reports contrary to Order No.104 (1) of LGFM (2009). 52 Ludewa DC According to the approved staff establishment, Ludewa District Council was required to have 570 staff in order to smoothen operations of the Health activities at Ludewa District. However, the available number of staff is 353 thus making a shortage of 217 staff. Shortage of staffing in health sector department may lead to difficulties in implementing health basket fund activities,which makes the achievement of planned target difficult During the year 2011/12 the council procured drugs and other medical supplies through several payment vouchers amounting to Shs.20,960,200 from suppliers other than Medical Stores Department (MSD). However examination of the payment vouchers and their supporting documents noted that, the statements from MSD attached as evidence of missing items does not match with Local Purchasing order raised. This is contrary to Para 3.5(h) of the Comprehensive Council Health Planning (CCHP) Guidelines of 2007 and Sec. 51 of Public Procurement Act, The Council purchased stationeries (hospital cards and file covers) for Shs.16,500,000 from St. Getrude Imilawa vide PV No.62/12 through basket fund account without the approval of the tender board. Stores worth Shs.19,675,300 were issued without issue vouchers contrary to Order No. 54(5) of the LGFM, Stores worth Shs. 20,727,500, were not delivered by Medical Stores Department. 53 Geita DC Deferred payments shs. 50, 541,000 Questionable purchases of medical drugs/equipments shs. 15,912,000 Procurement of Medical Supplies from private Pharmacy 113

126 shs. 170,067, Makete DC According to the approved staffs establishment, Makete District Council was required to have 622 staffs in order to smoothen operations of the HBF activities at Makete District Council. However, actual number of staffs available is 250 hence making a shortage of 372 staffs. Shortage of staffing in Health Sector Department may lead to difficulties in implementing health basket fund activities for which non achievement of planned target is likely to occur. The council spent a total of Shs.1,690,000 on an activity not budgeted in Health Basket Fund Plan of Action contrary to Order No.23 (1) of LGFM, 2009 caused by Weak internal control over budget provision. Using Health Basket Funds for unbudgeted activities might result in unavailability of funds for the planned activities. Goods worth Shs.850,000 were ordered and received from GFC General Supplies and paid via Cheque No and PV No.49/11, however the LPO were raised seven (7) days after goods were delivered, contrary to Order No.69 (1) of LGFM, Iringa MC The Council transferred Shs. 65,596,616 as a contribution to Regional Medical Officer instead of Shs. 58,615,825 as per Comprehensive Council plan. The Statement of Accounts (MSD) of Iringa Municipal dispensaries shows debit entry of Shs. 9,253,036. Debit/Reversal transactions may lead to reduction of the MSD supplies without the knowledge of the customer. The MSD statement of account of Iringa Municipal shows credit entry of Shs. 18,199,972 in respect of F.F.U account which may lead to increase of MSD supplies without the knowledge of the customer. Examination of Financial statement disclosure, some shortfalls were identified regarding IPSAS disclosure requirement is concerned, in preparation of the 114

127 statement of Financial Position, Statement of change in Net Assets and Cash flow statement. 56 Njombe TC Njombe Town Council through Basket fund account received an excess fund from Treasury amounting to Shs 12,066,752. However, the funds were not utilized in the respective financial year, and were planned to be utilized in financial year 2011/2012. The utilization of the excess fund was not confirmed. 57 Kibondo DC The Council has not implemented the previous year s audit recommendations which were made on major findings which required management s necessary attention and action for improvement amounting to Shs. 376,104,895. During the year under review Kibondo District Council procured different medical supplies, and drugs amounting to Shs. 17,660,000 for the Councils Hospital, Government Health Centers and Dispensaries from private suppliers. I noted various irregularities such as lack of evidence of MSD out of stock for procurement worth Shs. 5,990,000, The MSD invoices attached for procurement worth Shs.11,670,000 to show the status reflected the prior period before the order was placed and there was a long time interval between the date of out of stock status and the date which the user department initiated the procurement process which raise doubts on the accuracy of out of stock status. The Council procured goods from various supplies neither approved by the Government Service Procuring Agency (GPSA) nor the Council Tender board. Contrary to Regulation No. 68(5) of public procurement of Kondoa DC The Internal Audit Unit has not conducted audit on implementation of HBF for the financial year ended 30 th June, During the year under review a total of Shs. 30,868,126 was paid to clear the Council s outstanding liabilities related to the previous financial years contrary to Order 22(1) of LAFM, This has an impact of 115

128 distorting the budgetary controls. Kondoa District Council bought diesel from Kondoa Service Station and WP & D Company above the price issued by EWURA which resulted from paying Shs. 3,896, Magu DC Up to 30 th June 2012 there was unspent balance of Shs. 273,528,227 equivalents to 27% indicating that some of the planned activities were not implemented. Payments amounting to Shs. 31,538,000 were made without being supported by the Hospital Therapeutic Committee statement/report to confirm the receipt of that medical drugs/equipment. Also, procurement was made without prior approval from the Tender board contrary to Regulation 68(2)(5) of the Public Procurement Regulations G.N No ,and Comprehensive Council Health Plan Guidelines,2007 (chapter III para.3.5(h). Furthermore, payments were made to the financial year 2011/2012 in respect of 2010/ Same DC There was unutilized fund amounting to Shs. 70,121,466 which imply that some planned activities were not implemented at all, thus the earmarked service to the intended community have been delayed. 61 Siha DC There was unutilized fund amounting to Shs. 25,472,562 which imply that some planned activities were not implemented at all, thus the earmarked service to the intended community have been delayed. Quoted prices for procurement of medicines and hospital supplies exceeds MSD price catalogue Shs. 2,979, Chunya DC Health Basket Fund projects not reviewed by the Council s Audit Committee Expenditure made out of Budget Shs 6,300,000. Emergence Procurement of Goods done but goods are still in Store Shs. 2,410, Procurement of Goods and Service through Special Imprest Shs.4,630,

129 63 Rungwe DC Understatement of figure of cash and cash equivalents 31,959,220 Non disclosure of important/ useful information in the notes Cash flow statement disclosed shs 9,736,100 as cash flow from operating activities.however,the item disclosed is contrary to the IPSAs cash flow statement presentation frame work The Cash flow statement disclosed shs 9,736,100 as surplus/deficit before taxation, but according to the statement of financial performance, the surplus/deficit for the year was zero. The cash flow statement disclosed shs.77,349,500 as increase in trade and other receivables.however,according to the statement of financial position there was no trade and other receivables for the year ended 30/6/ Iringa DC According to the approved staffs establishment Iringa District Council was required to have a total of 423 staffs in order to smoothen operations of the Health Sector activities at Iringa District. However it was noted that, the actual strength of staff were 266 staff leaving a shortage of 157 staff caused by lack of authority to employ more Health staff due to limit of the council s establishment plan for the year under review. This implies that, the Council objectives cannot be achieved due to inadequate number of Health Sector staff. Imprest amounting to Shs.2,422,000 was still outstanding as at the time of audit. This may lead to misappropriation of council funds. The council purchased drugs worth Shs.567,700 vide PV No.154, and Cheque No from Medical Stores Department. However, neither Delivery Notes, Ledger Folio References nor physical existence of purchased and paid for items were made available for audit verification. This implies that the purchased goods may 117

130 be misappropriated. 65 Sumbawanga DC Inconsistency between the reported figures of financial performance during the year Double payment of training expenditures Shs. 4,200,000 Doubtful payments of Shs. 2,135,000 Payments over and above the approved and supported fund Shs. 6,990,000 Uncompleted work of Shs. 12,666,000 Absence of activity reports to support Shs. 11,424,200 spent on Sensitizations, Supportive Supervision, Meetings and other activities. Delay in release of funds from District Development account to Health Account Shortage of 455 staffs Unsolved previous years matters amounted to Shs.177, Absence of periodic audit reports from the internal Audit Unit on the Basket Funds (HBF 66 Mpanda DC Missing supporting documents Shs.2,255, Deferred payments Shs. 10,794, Planned Basket Fund activities not implemented during the year shs.34,115, Unresolved previous year s audit findings valued at Shs.178,333, Mbinga DC Payments totaling Shs.15,460,340 were not supported by relevant documents. The council entered into contract with M/s VD Enterprises Ltd for construction of intensive care unit (ICU)-phase 1 and eye clinic blocks at Mbinga District Hospital through contract no. MB/BF/ /W/101 with the contract sum of Shs.88, 276,200 on scrutiny we noted that the contractor delayed in completion of the project. 68 Namtumbo DC Payments amounting to Shs. 4,021,000 were not supported by relevant documents 118

131 Payments amounting to Shs. 68,944,000 were erroneously charged to wrong GFS codes contrary to order No.49 of LAFM of 1997, which emphasizes that expenditure be incurred according to the approved estimates in their respective budget line. Review of the financial statements for the year ended 30/6/2012, noted that the items disclosed in the financial statements were not supported by explanatory notes contrary to the IPSAs 1 financial statement reporting frame work. 69 Songea DC Payments amounting to Shs.5, 325,000 were made to various officers without being pre audited. Payments amounting to Shs.14, 854,200 were erroneously charged to wrong GFS codes. Payments amounting to Shs.12, 000,000 were ineligibly transferred from Health Basket Fund account to CHF account. Payments amounting to Shs.29, 101,500 were authorized for payment before being pre audited contrary to Order No 8 of LAFM. Imprest aggregating to Shs.3, 674,500 issued to various staff were still outstanding 70 Songea MC Inconsistency in reported balances of opening balance of cash and cash equivalent shs 28,557, Material differences noted in comparable figures of financial statements Non preparation of IPSASs Compliant Financial Statements Improperly authorized payments Shs. 8,915, Tunduru DC Results of audit test checks revealed that payments amounting to Shs. 137,438,000 made for purchase of different supplies for use during implementation of Health Basket Fund activities were made without approval of tender board. 72 Temeke MC Partially implemented activities worth Shs. 493,583,779 Payments charged to wrong expenditure code Shs.63, 441,67 119

132 Deferred Payments Tshs. 75,772,038 Insufficient Council contribution to Health Basket Funds Shs.97, 000, Kilombero DC The Council planned to implement four activities for Shs. 95,920,240. However up to 30 th June, 2012 those activities were still in progress The Council Planned to accomplish 18 activities worth Shs. 174,586,624 under Health Basket Fund. Though allocation with resources,however but up to 30 th June, 2012 those activities were yet to be implemented 74 Morogoro MC Up to 30 th June, 2012 activities amounting to Shs. 87,930,385 were in progress A total of 35 activities worth Shs. 91,910,930 allocated with resources were not implemented as on 30 th June, Ulanga DC Up to 30 th June, 2012 activities worth 55,658,275 were in progress. The Council had a closing balance of Shs. 73,371,775 which represented 23 activities that were planned to be implemented during the year but were not executed. Contrary to the requirement of regulations, a sum of Sh 7,847,550 was spent by the Council for the purchases of diesel and maintenance of vehicles without proper approval of the tender board. The Council paid Shs. 14,769,000 to M/s M.G.School Equipments Co. and Kimbasko Company Ltd. being payment for procurement of drugs and Hospital Equipment. The Council procured drugs and Hospital Equipment worth Shs 6,123,200 without being routed through Medical Store Department for confirmation whether the required drugs and equipments were out of stock. 76 Chamwino DC Deferred payment worth Shs. 10,000,000 was made to settle 2009/2010 creditor who was not included in that year s creditors balance. Deferred payments imply that the prior year balance of creditors was understated by 120

133 77 Kilwa DC the noted amount and the implementation of 2011/2012 activities was affected Shs 22,326,500 was paid to garage owners in respect of maintenance of motor vehicles.however contrary to Reg. No 59 (4) (5) of the PPR of 2005 the items replaced and used spare parts could not be ascertained as no record of maintenance were maintained by transport officer. 78 Kilosa DC The Council planned to implement 4 activities under HSBF for Shs. 96,867,405.40, however; review made in the progress report revealed that these activities were still in progress. The council planned to implement 27 activities at a cost of 97,766, Up to 30th June 2012 those activities were not implemented 79 Mvomero DC Four activities worth Shs. 46,316,7.03 were still in progress. 80 Lindi DC Payment amounting to Shs.2,573,662 were not properly supported, therefore, authenticity of payments made could not be ascertained and confirmed. 81 Lindi MC The Council planned to implement 13 activities at a cost of Tzs.68,432,048.All activities were partially implemented to the tune of Tzs.42,967,453 leaving activities worth on progress. The Council paid a sum of Tzs. 41,470,000 to carter for various activities. However no activity report was made available when requested. In that we could not confirm that those activities were satisfactorily implemented and completed. 82 Liwale DC The Council planned to implement four activities through HSBF worth Shs. 29,600, However, as at the time of this audit (August 2012) respective projects were found not implemented. Shs.6, 000,000 was paid to carter for on call allowances 121

134 to hospital staff.these payments constitute ineligible expenditure as does not constitute expenditure to be made out of the Health Basket Fund. 83 Nachingwea DC Payments amounting to Shs.7, 160,910 were not properly supported therefore; authenticity of payments made could not be confirmed. Purchased goods for Shs.7, 033,300 were not recorded in the stores ledger contrary to the requirement of order No.59 (1) of LAFM, Ruangwa DC The Council planned to implement three projects with a budget of Shs. 28,132,000. But the same was not implemented up to 30 th June Singida DC The Council has a shortage of 287 staff of different cadres to meet the standard requirement. This implies that the Health sector may be operating ineffectively if the noted situation is not checked. 86 Singida MC 87 Nzega DC Shs. 2,173,500 was made to M/s Ottawa Automobile Workshop & G. Works for maintenance of vehicle with registration SM 4098.However, the related supporting documents inspected showed that the payment made was not related for the year 2008/2009 and also the supplier was not include in creditors schedule. The Health Department which deals also with Health Basket Fund activities does not have adequate skilled human resources as it has 156 health staff personnel instead of 184 which leads to a deficit of 28 health staff. The Health department may continue operating ineffectively if the noted situation is not checked. The Council procured drugs and equipment worth Shs.56,159,000 from a local supplier other than Medical Stores Department (MSD) without prior approval/out of stock from MSD. 122

135 88 Sikonge DC The Council incurred expenditure of Shs. 11,321,500 but the same was charged to wrong codes and no adjustments were made in the respective expenditure code and accounts. The Council made payment amounting to Shs. 13,776,140 in respect of allowances. The payments were not supported with relevant documents contrary to Order No. 10(2) (d) of the Local Authority Financial Memorandum (2009). Goods worth Shs. 6,978,750 were not recorded in the respective stores ledgers contrary to Order No.59(1) of LAFM(2009) Funds amounting to Shs. 236,275,195 received during the financial year under review were not spent. The Council has not implemented the previous year s audit recommendations which required management s necessary attention and action for improvement amounting to Shs. 309,875, Tabora DC The Council has not implemented the previous year s audit recommendations which were made on major findings which required management s necessary attention and action for improvement amounting to Shs. 1,014,485, Simanjiro DC The council paid Shs 10,031,500 to various suppliers for supplying goods. However these payments were effected before delivery of the items/goods contrary to Regulation 85(2) of Public Finance Regulations of 2001 (Revised 2004). Medical items were purchased locally from private Shops and not from Medical Store Department contrary to Section 57 of Public Procurement Regulations 2005 for Goods, Works, Non-Consultant Services and Disposal of Public Assets by Tender. No evidence was produced to confirm that the items were out of stock at MSD at that material time. There is a possibility that the Council procured the substandard items. 123

136 The council procured a Generator for Shs 19,700,000 from FMD East Africa ltd. However funds which were allocated for procurement of the generator as per budget was only Shs 15,000,000. This implies that other budgeted activities were not implemented. 91 Morogoro DC Review made on financial statement for the financial year 2011/12 noted that the Council had balance of Shs. 13,435,031 as rollover fund. However, no report has been produced and submitted during audit for ascertaining respective activities and the status implementation using such amount. Up to 30 th June 2012 activities worth Shs. 72,133,999 were in progress. Payments amounting to Shs. 36,285,840 were charged to the wrong accounting codes contrary to Order No. 23(1) of LAFM The Council made procurement amounting Shs. 60,276,500 without being endorsed by the Tender Board. 92 Muleba DC There was unutilized funds amounting to Shs. 185,423, which imply that some planned activities of the same magnitude were partially or not implemented at all, thus the earmarked services intended to the community have been delayed. 93 Nanyumbu DC Evaluation of implementation report, budget and actual expenditure revealed unspent balance of Shs. 19,335,987 indicating that activities of the same magnitude were not implemented. 94 Mbeya DC unspent balance of shs 163,030,249 Unimplemented activities worth Shs.90,785,571 Activities not completed Shs.13,117,

137 (b) Councils issued with Qualified Audit Opinion Out of the 133 Councils audited thirty four (34) which is 25% were issued with qualified audit opinion as shown in Table 37 below: Table 37 Councils issued with Qualified Opinion 1. Hanang DC Stores worth Shs. 18,996,976 purchased and delivered by suppliers were not recorded in their respective stores ledgers contrary to Order 59 of the Local Authority Financial Memorandum, 2009 The Council purchases and paid goods and services of Shs.4,185,000 but the time of audit was not confirmed to have been delivered 2. Handeni DC Payments amounting to Shs. 21,755,000 were made to various payees without sufficient supporting documents such as attendance register for seminar/workshop participants, activity report and night out allowance claim forms. 3. Kilindi DC Expenditure amounting to Shs. 13,815,470 paid by the Kilindi Designated Hospital to finance various expenditures was not properly supported by relevant documents. 4. Kiteto DC IPSAS s 1 Presentation of financial statement, recognizes Notes to the financial statement as fundamental element of the financial statement. However, financial statements of Kiteto District Council Health Basket Fund for the year ended 30 th June, 2012 have not disclosed any Notes to the financial statement. Motor vehicles STK 3031 (Toyota land cruiser), DFP 656 (Toyota Hard Top), SM 5117, DFP 6999, and DFP 4521 which were specifically allocated for Health Basket Fund activities were not reported in the financial statements under property, plant and equipment. The statement of financial performance has reported 125

138 Shs. 5,927,518 as deficit during the year while under normal circumstances the statement of financial performance cannot have a surplus or deficit balance and should always have a nil balance 5. Korogwe DC Stores worth Shs.600, 000 purchased and delivered by suppliers were not recorded in their respective stores ledgers contrary to Order 59 of the Local Authority Financial Memorandum, Audit of exchequer issue notifications for release of Basket funds for the year, 2011/2012 revealed that Shs. 17,453,900 released through exchequer issue notification No.86/EB/AG/159/11/811 of June, 2012 was not traced to have been received in the relevant books of accounts at Korogwe District Council. The reflected figure of the recurrent grants in the statement of financial performance was Shs. 638,620,373 while the actual amortized grants shown on note no. 11 (Page no.36) reflected the actual figure of Shs. 484,736,232. Therefore the revenue was over stated by Shs. 153,884,141. Statement of financial performance presents a deficit of Shs. 153,866,050 while in actual fact the financial performance should have no surplus or deficit. The cause of such deficit was due to overstated figure of recurrent grants 6. Korogwe TC Cash balance as per bank reconciliation statement was Shs. 26,220,580 while the actual figure of cash unspent was Shs. 35,888,862 resulting to a difference of Shs. 9,668,282 unexplained. 7. Longido DC The sum of Shs. 48,410,036 has been reported as surplus for the year in the statement of financial performance by function while under normal circumstances the statement of financial performance cannot have a surplus or deficit balance and should 126

139 always have a nil balance. 8. Lushoto DC Audit of payment voucher and related documents noted payments made to Bumbuli Lutheran hospital amounting to Shs. 44,841,640 being outstanding expenditure for provision of treatment for pregnant women and infants as per letter Ref. BH/ARD/VOL.I/18/11/2011 dated contrary to Order 22 (1) of LAFM, (2009). 9. Mbulu DC Payment vouchers amounting to Shs 15,821,000 were noted missing from their respective batches contrary to Order No. 104 (2) of LAFM Audit could not be able to ascertain the correctness of expenditure. During the year under audit, Mbulu District Council made payment amounting to Shs 85,546,653 without sufficient relevant documents contrary to Order No.8 (2c) of the LAFM 2009, In the absence of adequate supporting document authenticity of the payments made could not be ascertained and justified An amount of Shs 1,524,000 was paid to different payees in respect of implementing different activities. However scrutiny of the payment vouchers, budget and other supporting documents noted that the implemented activities were not related to Basket Fund activities. Stores worth Shs 5,050, were not accounted for in the Council s Store ledgers, contrary to Order No 59 (1) of the LAFM, In the absence of the stores ledger s records and issue vouchers, the propriety and authenticity of items purchased might not be confirmed. 10. Monduli DC Our review of the statement of comparison between budget and actual payments revealed that various expenditure items exceeded its annual approved budget by Shs. 36,678,219 equivalent to 16% without reallocation approval Order No. 29(1) & (4) of LAFM (2009) requires that every non cash transaction shall be supported by an adjustment of journal vouchers showing items affected by the 127

140 adjustments and reasons for making the adjustment. During our audit of accounting records and verification of the genuineness of that transactions made in cash book were not available despite several requests made as per our audit evidence trucking sheet with references no. MDC/HSBF/2011/ Ngorongoro DC 12. Rombo DC Payment vouchers amounting to Shs.1, 305,000 were missing from their respective batches contrary to Order No. 104(2) of LAFM 2009 Payments amounting to Shs.3,720,000 were lacking sufficient supporting documents such as pay list and activity reports contrary to Order No 8(2) (c) of LAFM The statement of financial position has reported a nil balance of recurrent grants despite the fact that Note 11 to the financial statement has reported recurrent grant amounting to Shs. 108,649,586, Payment for goods not supplied - Shs.4,709,200 The Council reported shs.65,,871,543 as surplus in the Statement Financial Performance instead of nil balance, Total Expenditure understated by Shs. 1,755,717 in the Statements\ of Financial Performance for the year ended 30 th June, Kigoma DC 14. Kigoma MC Apart from the noted delays in retirements of imprests issued to various officers, imprests of Shs. 12,750,000 were not retired by several officers to whom the same were issued. Failure in retirement of imprest may lead to believing that funds were not used for intended purposes. The Council overstated the opening balance of cash and cash equivalent by Shs. 35,263,000 following the fact that while the closing balance in the financial year 2010/2011 was Shs.19,274,000, the opening balance was reported in the financial statements as Shs. 54,537,000 showing overstatement of Shs. 35,263,000. The noted 128

141 overstatement renders the financial statements misleading. The Council main cashier drew cash amounting to Shs. 6,550,000 for the purpose of paying a contractor for the Construction of a pit latrine and a shed in which to install a generator but the amount was allegedly kept by in the till for about 5 months before the same was banked. This implies that the cash drawn was possibly used for other purposes before the same was refunded and deposited. Procured items worth Shs. 10,630,000 were noted to have not been taken on ledger charge and in this respect they were not accounted for. Failure in accounting for the purchased items may imply that the purchased items were not used for the intended purposes. 15. Iramba DC The Council charged payments of Shs.17,808,737 against HBF for activities which were not related to Health Basket Fund. Payments for activities not related to HBF has caused deficit of funds for implementing the planned activities The Council paid Shs.145,310,030 to Lambi Lutheran Hospital being Health Basket funds allocated to Voluntary Agency Hospital contrary to approved budget of Shs.141,398,058 resulting into over payment of Shs.3,911,972. The overpayment has caused deficit of funds set for implementation of some planned activities. Payment of Shs. 8,346,049 was made to the supplier in settlement of a liability of the same amount which was not included in the prior year creditors balance contrary to Order 22 (1) of the Local Authorities Financial Memorandum, This, apart from understating the prior year creditors balance, has affected the implementation of planned activities in the financial year 2011/ Kasulu DC Activities worth Shs. 202,456,995 were not implemented and therefore the health services of the same value 129

142 were not provided to the community. Expenditure worth Shs.157,535,000 was not supported by their respective payment vouchers, therefore, the nature and validity of expenditure incurred by Kasulu District Council could not be verified. 17. Lushoto DC Audit of payment voucher and related documents noted payments made to Bumbuli Lutheran hospital amounting to Shs. 44,841,640 being outstanding expenditure for provision of treatment for pregnant women and infants as per letter Ref. BH/ARD/VOL.I/18/11/2011 dated contrary to Order 22 (1) of LAFM, (2009). 18. Pangani DC Audit of stores of Pangani District Council noted hospital supplies worth Shs. 13,876,700 ordered and paid for but not taken on ledger charge contrary to Order 54(3) and 59 of the LAFM of There is a possibility of stores to be misused by unfaithful employees without the knowledge of management. Payments amounting to Shs. 35, 126,500 were paid to DED Pangani for various activities without sufficient relevant supporting documents contrary to Orders No. 8(2) (c) and 104 (1) of Local Authority Financial Memorandum (LAFM) 2009; In the absence of sufficient supporting documents, the propriety of expenditure incurred could not be ascertained 19. Kwimba DC A sum of Shs. 746,555,730 was incorrectly paid using non existing code (i.e. B ) hence making difficult for analyzing and classification of accounts Audit of payment vouchers and supporting document revealed that the total amount of Shs. 78,529,566 were effected against activities and claims relating to last year s budget but payments were made in the financial year 2011/2012 contrary to Order No. 22 (1) of the Local Authority Financial Memorandum (LAFM),2009.This implies that some planned activities of the financial year 2011/12 to the tune of Shs.78, 529,566 might not be implemented due to lack of funds. Review on payments regarding repair of motor vehicles 130

143 revealed that motor vehicle repairs to the tune of Shs.1, 675,600 but no post inspection reports were provided after repairs have been carried out as required by Order No.94 of Local Authority Financial Memorandum, Sengerema DC The council did not prepare the financial statements which are compatible with the requirements of MoU and IPSAs adopted by the council as they had no Statement of financial performance, accounting policies, notes to the financial statements, Statement of capital expenditure and its financing for the year ended 30 th June, 2012 and the statement of financial position Shs. 69,935,418 was paid in the year 2011/2012 in respect of previous year s liabilities, and there were no proofs that the same payments formed part of the 2010/2011 Councils creditors and approved to be paid in the year 2011/2012. This is contrary to Order No.22 (1) of the Local Authority Financial Memorandum (LAFM), 2009 Order No(s) 23(1)-(2) and 27(3) of the LAFM (2009). 21 Ileje DC The Notes supporting financial statement were not submitted with statement of financial position, statement of financial performance and statement of cash flows for Health Basket Fund, as such making the submitted financial statements incomplete. The cash and cash equivalent figure reported in the statement of financial position had a difference of shs 15,417, compared to the figure disclosed in cash flow statement 22. Kyela DC Cash not receipted by respective payees Shs.959,500. Unvouched expenditure, Shs 23,890,780 Improperly vouched expenditure Shs.24,167,000. Activity period not indicated against documents for payments Shs.15,035, Mbarali DC Non maintenance of Vote book/commitment control. Projects funds not received from Development account 131

144 Shs. 146,928,050. Procurement of goods from unapproved suppliers, Shs. 4,223,500. Deferred payments, Shs. 46,493,885. Missing payment vouchers, Shs. 125,240,075. Project funds paid to meet other operation (OC) charges, Shs. 3,061,000. Improperly vouched expenditure Shs. 11,625,000. Missing payment vouchers, Shs. 125,240, Mbeya CC Improperly vouched expenditure, Shs 3,878,000. Unvouched expenditures, Shs. 13,312, Mpanda TC Overstatement of amortization of recurrent grant by shs 13,879, and maintenance expenses by shs 4,275, Understatement of wages, salaries and employee benefits for financial year 2010/2011 by shs 64,759, and supplies and consumables used for financial year 2010/2011 by shs 4,039, Mufindi DC The statement of financial performance of Health Basket Fund as at 30 th June, 2012 under note 10 disclosed supplies and consumables amounting to Shs.258,148,749. However, notes to the financial statements reflected a total of supplies and consumables amounting to Shs.226,125, resulting to overstatement of Shs.32,023,428. Shs.34,763,500 were not adequately supported with relevant supporting documents contrary to Order No.8(C) of Local Government Financial Memorandum (2009) caused by inadequate control over documentations to support payment vouchers. This implies that the validity, accuracy and completeness of the transaction could not be ascertained. 27. Njombe DC A transaction titled change in Inventory with amount of Shs.(1,799,942) in the financial year 2011/12 and 132

145 Shs.(5,242,070) in financial year 2010/11 have been disclosed under expenses without supporting explanatory notes. However it is unusual to disclose a transaction related with inventories in the statement of financial performance. Development grant received during the year has been disclosed under cash flow from financing activities at Shs.89,168,500 and supported with Note 47. However this transaction with its amount cannot be justified due to non existence of note 47 in notes submitted to support submitted financial statements. The statement of financial position reflected inventories amounting to Shs.7,042,012. However no stock count sheet were attached and signed by management team responsible for justification for undertaking of stock tacking as at 30 th June, In absence of stock count sheet signed the validity of inventories amount reported could not be ascertained. 28. Kongwa DC Supporting schedules amounting to Shs 74,506,070 were not submitted to audit; therefore, the presented financial statements could not be verified in absence of supporting schedules contrary to Order No.31 (6) of LAFM. Deferred capital grant is overstated by Shs.24,316,560 since there was no opening balance of deferred capital grants during the year and the amount received during the year of Shs. 581,166,800 was charged to recurrent grants. Impropperly vouched expenditure Shs. 91,114,940 Payments worth sh. 157,633,533 were effected by using debit notes instead of cheques. 29. Mpwapwa DC The Council made payments worth Shs. 18,947,000 but their related payment vouchers had no supporting documents. In the absence of the expenditure supporting documents, the propriety of payments made could not be confirmed. 133

146 The Council made cash payment of Shs. 2,657,000 to one of its officers in order to make payment for insurance service for DFP 7183 motor vehicle the acknowledgement receipt of which was only for Shs. 1,300,000. This shows that the balance of Shs. 1,357,000 was possibly not paid to the Insurance Company The Council incurred a loss of Shs. 11,252,626 through various payments for fuel acquired at higher prices than EWURA specified prices contrary to the contract agreement. This shows that the Council is in some instances weak in contract management and that the noted overpayment has possibly affected the implementation of some planned activities 30. Urambo DC Shs. 11,774,000 was paid to various employees being extra duty allowances for the months of December, 2011 to February, 2012 the supporting claims of which were not produced for audit inspection. In the absence of supporting documents, the propriety of payment made could not be confirmed.the council made payment of Shs. 4,047,400 to a supplier in clearance of a payable amount which did form part of creditors balance in the prior year financial statements. 31. Muheza DC 32. Ilala MC The Council transferred Shs.17,116,070 from the Hospital Basket Fund account to the general account of the hospital (DDH Account) without authority and also was not properly supported The Council procured fuel worth Shs 246,890 but the fuel was not recorded in the stores ledger contrary to order No 54(5) of LAFM of 2009; under this circumstance the authenticity of the fuel purchased could not be confirmed. The Municipal Council procured medical equipment worth Shs.15,014,500 from private dealers without approval from MSD. Cash and cash equivalent was overstated by 134

147 Shs.15,885, Water Sector Development Programme Introduction The Water Sector Development Programme was designed to address shortfalls in urban and rural water supply infrastructure, to improve water resource management primarily through strengthening the country s nine Basin Water Offices (BWOs) and to strengthen the sector institutions and their capacities. In 2002, the Government of the United Republic of Tanzania formulated the National Water Policy with the main aim of providing a comprehensive framework for sustainable development and management of the Nation s water resources, in which an effective legal and institutional framework for its implementation will be put in place. The National Water Sector Development Strategy (NWSDS) sets forth how the Ministry responsible for Water will implement the National Water Policy to achieve the NSGRP (MKUKUTA) targets. This will in turn guide the formulation of the Ministry s harmonised National Water Sector Development Plan and the Water Sector Development Programme as inputs into the Medium Term Expenditure Framework Financial Planning Process. The Ministry of Water (MoW) prepared a Water Sector Development Program (WSDP), for the period , which is a consolidation of three sub-sector Programs, namely: Water Resources Management, Rural Water Supply and Sanitation and Urban Water Supply and Sewerage. The program also includes strengthening and building capacity of sector institutions to effectively support implementation of the WSDP. The Councils listed below were audited in the financial year 2011/2012 and the type of audit opinion issued and the reasons for the issuance of such opinion: 135

148 (a) Councils issued with Unqualified Opinion without emphasis of matters Ten (10) Councils have been issued with Unqualified Opinion without emphasis of matters which is 7.6% as shown in Table 38 below: Table 38: Councils issued with Unqualified Opinion without emphasis of matters S/N Council 1 Rorya DC 2 Geita DC 3 Kwimba DC 4 Arusha MC 5 Arusha DC 6 Meru DC 7 Simanjiro DC 8 Sumbawanga DC 9 Kilolo DC 10 Ludewa DC (b) Councils issued with Unqualified Opinion with Emphasis of Matters Ninety five (95) Councils have been issued with Unqualified Opinion with emphasis of matters which is 72.5% as shown in Table 40 below: Table 39: Councils issued with Unqualified Opinion with emphasis of matters 1. Mpwapwa DC The Council had unspent balance of Shs. 421,468, which is equivalent to 81.5% of the total funds available during the year. Out of the nine (9) wells drilled to provide clean and safe water to villages, only two (2) wells were found productive implying that 22.2% of the targeted objective set by the program was achieved by the 136

149 Council. A sum of Shs.548,031,750 approved for Water Projects was not released by the Central Government. 2. Kigoma DC The Council had total funds of Shs. 820,124, out of which Shs. 231,558, was spent for implementation of WSDP approved activities, leaving unspent balance of Shs. 588,566, Iramba DC Tha Council internal audit unit has not conducted and reported separately on implementation of WSDP activities contrary to the requirement of Section of WSDP MoU and WSDP implementation manual of 2006 Vol. 3 Funds not utilized Shs. 1,307,750,970 Shortage of ten (10) staff for implementation of WSDP activities. 4. Manyoni DC The Council had an unspent balance of Shs.1,104,866,928 equivalent to 86% of the available funds. Non preparation of separate Internal Audit report for WSDP which is contrary to the Memorandum of Understanding for the WSDP para Shortage of 13 staff in Water Department 5. Singida DC There was a delay in internal transfer of Shs.480,648,000 from Development Account to WSDP Account Amount received over approved budget not explained Shs.723,108,000 WSDP activities not fully implemented Shs.1,754,161,612 Ineligible Payment of VAT Shs.342, Singida MC Improper classification of expenses Shs.77,207,855 Council entered into Contract without sufficient funds Shs.277,123,

150 Non disclosure of Significant accounting policies contrary to Order No. 31(5) of LAFM Igunga DC Budgeted funds not disbursed for the implementation of 2011/2012 planned activities worth Shs. 1,128,250, Nzega DC Unreleased funds by the Treasury of Shs.738,866,001 was a drawback to achieving project objectives 9. Sikonge DC Improperly vouched expenditure for allowances and contract payments Shs.68,252, Tabora DC Doubtful procurement worth Shs.4,370,000 Improperly vouched expenditure Shs.2,900, Tabora MC Eleven (11) drilled boreholes costing Shs.73, 850,000 were found without water. 12. Urambo DC Funds not utilized Shs. 527,589, Urelease budgeted funds Shs.1, 256,043,747. Shortage of 6 staff in the Water Department. 13. Ilala MC There were unimplemented activities worth of Shs. 441,000, Kinondoni MC There were unimplemented activities of Shs. 226,098,947 A sum of Shs. 89,711,121 raised in my previous audit recommendation as funds intransit for the financial year 2010/11 was still not cleared to date (Nov. 2012) 15. Temeke MC An amount of Shs. 30,866,891 was overspent against the budget There were unimplemented projects of Shs. 326,569, Biharamulo DC Planned activities not implemented Shs.401,544,

151 17. Bukoba DC Delay in completion of Construction of Mashule Water Supply Scheme Shs.456,770,500 Delay in transferring of funds from Development Account to the user Department (Water Sector) Shs.301,804, Bukoba MC Planned activities not implemented Shs. 306,054, Chato DC There was unutilized amount of Shs.76,752,043 which implies that some planned activities of the same magnitude were not implemented. 20 Missenyi DC There was unutilized amount of Shs.278,083,000 received from the Treasury. The Council paid Shs.3,565,000 for the purchases of 1,595 liters of diesel which was not confirmed to have been recorded in the Stores Ledger 21 Muleba DC There were unutilized amount of Shs.1,036,835,685 which implies that some planned activities of the same magnitude were partially or not implemented at all. 22 Ngara DC There was unutilized funds totaling Shs.87,102,045 which implies that Rulenge gravity water supply scheme was not implemented at all. This may bring about budget revision to accommodate possible price fluctuations and effects of inflation. Irregular payments to contractor Shs. 70,942, Bunda DC There were unutilized funds amounting to Shs.767,476, which imply that some planned activities of the same magnitude were ether partially or not implemented at all. Payment was not supported by Technical and facilitation service consultancy totaling to Shs.98,164, Musoma DC 139

152 Unproductive water boreholes at Bukumi and Makojo Shs 25,625,000 Non compliance with the Resettlement policy framework in implementing the rural water supply and sanitation projects Uncompleted activities relating to promotion and sensitization of top rain water harvesting Non preparation of Annual District Water Supply and Sanitation Plans 25 Serengeti DC 26 Tarime DC Projects worth of Shs. 550,892,029 were partially or not all implemented. Three boreholes worth Shs.81, 900,000 at Mangucha, Kitawasi and Nyangoto were found without water. There were unutilized funds amounting to Shs.79,280,000 which implies that some planned activities of the same magnitude were partially or not implemented at all 27 Sengerema DC The Council remained with unutilized funds amounting to Shs. 424,896,583.75, equivalent to 64.81% implying unimplemented projects leading to intended beneficiaries missing the opportunity to use the facilities as planned. Payment vouchers amounting to Shs. 5,215,000 were not produced during the audit exercise contrary to Order no. 8(2)(c) of the Local Authority Financial Memorandum, The Council procured various stores worth Shs.11,450,000 from various suppliers without competitive quotations. 28 Bariadi DC There was an unutilized fund amounting to Shs. 83,232, which implies that some planned activities of the same magnitude were partially or not implemented at all. Completed Projects not put in use.this was worth of 140

153 Shs. 64,245, Bukombe DC There was unutilized funds amounting to Shs. 1,619,569, which implies that some planned activities of the same magnitude were partially or not implemented at all, thus the earmarked services/benefits to the intended community have been delayed. Incompleted construction works of water supply and civil works Shs. 229,975, Kahama DC There was unutilized funds amounting to Shs. 1,666,674,781 which implies that some of the planned activities of the same magnitude were partially or not implemented at all, There were Planned activities worth Shs. 1,557,794, 381 not implemented during the year. 31 Kishapu DC There was unutilized funds amounting to Shs.1,113,843,490 which implies that some of the planned activities of the same magnitude were partially or not implemented at all. There were unimplemented project activities- worth Shs.248, 083,895. Construction of 4 Shallow wells worth Shs. 328, 732,500 completed without fixing water pumps The Council s financial statements as at 30 th June 2012 disclosed existence of outstanding receivables amounting to Shs.271,227, Maswa DC There was an unutilized fund amounting to Shs. 173,061, which implies that some of the planned activities of the same magnitude were partially or not implemented at all. 33 Meatu DC There was unutilized funds amounting to Shs. 366,432, which implies that some of the planned activities of the same magnitude were partially or not implemented at all 141

154 Uncompleted Construction works worth Shs. 299,827, Shinyanga DC Payments amounting to Shs. 34,445,044 paid to various payees were not supported with relevant documents contrary to Order No. 8 (c) and 10 (2) (d) of the Local Authority Financial Memorandum (LAFM), There was unutilized funds amounting to Shs.693, 617,137 which implies that some of the planned activities of the same magnitude were partially or not implemented at all. Uncompleted Construction works worth of Shs.748,552,785 The council had outstanding payables totaling to Shs.4,906,406 which may affect the credibility of the Council. 35 Shinyanga MC There was an unutilized fund amounting to Shs. 284,503, which implies that some of the planned activities of the same magnitude were partially or not implemented at all. Uncompleted Construction works worth Shs. 461,254, Longido DC There were information missing in support of cash and cash equivalent of Shs.1,283,000 reflected in the financial statements. Payment vouchers amounting to Shs.900, 000 were not produced for audit examination. 37 Ngorongoro DC The Council overpaid a consultant contractor by Shs. 40,387, contrary to contract agreement 10 drilled deep boreholes for Shs 355,386,060 were found without water. 38 Hai DC There was unutilized funds amounting to Shs. 1,092,522,096 which implies that some of the planned activities of the same magnitude were partially or not implemented at all. 39 Moshi MC 142

155 There was unutilized funds amounting to Shs.234,340,216 which implies that some of the planned activities of the same magnitude were partially or not implemented at all. Deferred income of Shs.328,473,529 was reported as recurrent grant instead of Capital grant in the Councilors report. 40 Mwanga DC The Council had unspent balance of Shs. 436,548,948 at the end of the financial year under WSDP, this resulted in not achieving the objectives of the programme. During the year under review all previous outstanding matters raised of Shs.6,675,776 were not implemented. 41 Rombo DC The Council had an unspent balance of Shs. 418,018,855 which resulted in not implementing the intended projects during the year which was a setback to the programme. 42 Same DC Uncompleted Consultancy services in provision of technical and facilitation Services for rural water supply and sanitation Sub project worth USD 153, Siha DC 44 Babati DC Delay in completion of the Construction of 4 Boreholes worth Shs.152,990, Kiteto DC There was an unutilized fund amounting to Shs 665,264, which implies that some of the planned activities of the same magnitude were partially or not implemented at all. Procurement made without inviting at least three quotations Shs 6,408,199 The Council incurred shs. 209,042,900 for seven boreholes which did not produce water. 46 Mbulu DC There were unimplemented activities worth 143

156 Shs.1,160,883, Korogwe DC Overstatement of expenditure in the financial performance by Shs.2,662,835 as the Council reported a total expenditure of Shs.120, 075,876 in the statement of financial performance while the actual expenditure in respect of the WSDP was Shs.117, 413, Korogwe TC There was a difference of Shs. 3,933,400 between Exchequer notifications and actual amount of WSDP funds received by the Council. This difference had not been reconciled by management of the Council up to the time of writing this report. 49 Lushoto DC There were unutilized funds amounting to Shs. 1,401,532,805 which imply that most of the planned activities were not implementedl. 50 Mkinga DC There were unutilized funds amounting to Shs. 653,358,698 implying that some of the planned activities were not implemented at all, thus the earmarked services to the community for whom this project was intended were delayed. 51 Muheza DC The Council had an unspent balance of Shs. 536,607, indicating that some of the approved activities were not implemented during the year. 52 Tanga CC There was an unutilized fund amounting to Shs 515,667, which implies that some of the planned activities of the same magnitude were partially or not implemented at all. 53 Iringa DC There was an unutilized fund amounting to Shs.298,116,123 which implies that some of the planned activities of the same magnitude were partially or not implemented at all. According to the approved staff establishment, the 144

157 Council was required to have 16 staff in order to smoothly run operations of the Water Sector activities at the district, however, the Department has 12 staff hence a shortage of 4 staff 54 Iringa MC There was unspent balance of Shs.309,628,477 equivalent to 72.2% of the total funds available during the year. 55 Makete DC The Council had an unspent balance of Shs.530,434,730 which implies that 90.8% of the planned and approved activities were not implemented According to the approved staff establishment, the Council was required to have 27 staff in order to run the operations of the Water Sector activities in the Council, however the council had 12 staff resulting into a short of 15 staff in the Water Sector Department No specific internal audit report issued in respect of the WSDP activities, this is contrary to Para 8.2 (8.2.1 and 8.2.2) of the Memorandum of Understanding for Implementation of the Water Sector Development Programme. 56 Mufindi DC TheCouncil planned and approved budget of Shs.995,218,106 for Water Sector Development Programme (WSDP), however, the Council received Shs.407,686,500 thus Shs.587,531,606 was not released. The approved staff establishment for the Council water section was 35 staff, however, the department has 15 staff thus resulting into a shortage of Njombe DC There was an unutilized fund amounting to Shs. 503,955,532 which implies that some of the planned activities of the same magnitude were partially or not implemented at all. 145

158 The approved staff establishment for the Council water section was 12 staff, however, the department has 5 staff thus resulting into a shortage of 7. The Council issues a specific report in respect of Water Sector Development programme but no evidence of submission of the SAME to THE Water Sector Working Group contrary to Para 8.2 (8.2.1 and 8.2.2) of the Memorandum of Understanding for Implementation of the Water Sector Development Programme. 58 Njombe TC The Internal audit unit issued a specific report in respect of the Water Sector Development Programme but there was no evidence of submission of the report to the Water Sector Working Group contrary to Para 8.2 (8.2.1 and 8.2.2) of the Memorandum of Understanding for Implementation of the Water Sector Development Programme. 59 Ileje DC The Council spent Shs.21,531,026 equivalent to 4.6% of the total funds available during the year leaving unspent balance of Shs.448,909,071 which implies slow pace on implementation of the WSDP activities. Accountability of various items worth Shs.2,106,049 procured from various suppliers for the WSDP project use was not produced for audit contrary to Order No. 104(2) and (3) of the LGFM There were payments amounting to Shs.6,571,000 which were not supported by proper supporting documents contrary to Order No.8 (2) (c) of the LGFM Payment vouchers and their supporting documents amounting to Shs.1,630,000 were missing from their respective batches contrary to Order No.104 (2) of the LGFM The Council had shortage 11 staff in the Water Sector Departiment. 146

159 60 Kyela DC The amount for additions of PPE during the year 2011/2012 Shs.33,796,950 could not be ascertained due to lack of analysis There was an unspent balance of Shs.244, 424,127 equivalent to 81% of the available funds caused by late release of funds from the Treasury. This implies that, approved activities worth the unspent amount were not implemented during the year. 61 Mbarali DC The council paid a sum of Shs.183,321,000 to various Council accounts as inter account transfer from the WSDP account for the purpose of meeting various council expenses which are not related to the approved WSDP activities. This is contrary to Sect of the Memorandum of Understanding (MoU) 62 Mbeya DC The financial statements of the WSDP for the year ended 30 th June, 2012 were received by the Controller and Auditor General on 13 th November, 2012 a delay of 43 days after the statutory due date contrary to Order No. 31 of the Local Authority Financial Memorandum, The Council spent Shs.10, 887,283 equivalent to 1% of the total funds available during the year leaving unspent balance of Shs.1,061,258,504 which implies that 99% of the planned/approved activities for Rural Water Sector Development Programme for the year were not implemented. 63 Rungwe DC The Council spent Shs.367, 747,469 equivalent to 26% of the total funds available during the year leaving unspent balance of Shs.1,044,690,455 equivalent to 74%. This implies that planned ctivities of the same magnitude were not implemented. No detailed internal audit plan, program and reports for the WSDP activities were prepared for the year under review 147

160 64 Mpanda DC The Council spent Shs.41,853,700 equivalent to 2.8% of the total funds available during the year leaving unspent balance of Shs.1,442,252,987 (97%). This implies that planned ctivities of the same magnitude were not implemented. 65 Mbinga DC The financial statements of WSDP for the year ended 30 th June, 2012 were received by the Controller and Auditor General on 30 TH October, 2012 a delay of thirty (30) days after the statutory due date which is contrary to Order No. 31 of the Local Authority Financial Memorandum, 2009 The Council spent Shs. 85,094,274 equivalent to 8.1% of funds available leaving unspent balance of Shs. 967,325,715 ( 91.9%) which implies that the targeted water projects were not implemented by the same percentage. 66 Songea DC The Council spent Shs.82,421,651 equivalent to 20.5% of the total funds available, leaving unspent balance of Shs.319,785,063 which implies that, most of the approved activities related to the fund were not implemented during the year. Out-standing matters from previous years were reduced from Shs.71,548,664 to Shs.68,340,164 indicating laxity of management in attending audit recommendations. During the year, the Internal Audit Unit did not audit and issue a separate audit report for the WSDP activities which is contrary to Sect of the MoU of 2007 between the Government of URT and the Development Partners. Payments amounting to Shs.5,405,000 were authorized for payment before being pre audited contrary to Order No.10(2) of the LGFM Songea MC During the year under review, activities amounting to 148

161 68 Tunduru DC Shs.304,306,298 equivalent to 92.3% of total fund available were not implemented due to delay in obtaining the no objection from the World Bank. The Council spent Shs.156,076,967 equivalent to 15.7% of the total funds available during the year leaving unspent balance of Shs.834,912,456 which implies that approved activities with the same magnitude were not implemented during the year. During the year, there was no Internal Audit report issued specifically on WSDP activities which is contrary to Sect of MoU of 2007 between the Government of URT and the Development Partners. 69 Moshi DC Unimplemented activities worth of Shs. 459,405, Kilwa DC The Council incurred expenditure amounting to Shs 397,042, representing only 28% of Shs 1,411,985, which were available for implementation of WSDP activities. This implies that activities worth Shs 1,014,942, or 72% of the target were not attained. 71 Lindi DC The Council had a total amount of Shs 688,623,538 for implementation of WSDP activities. However up to 30 th June, 2012 there was unspent balance of Shs 498,854,615 indicating that most of the approved activities were not implemented during the year. 72 Lindi MC The Council had a rollover activities amounting to Shs 242,920,498. Up to 30 th June, 2012 activities worth Shs 60,594,058 were carried out leaving activities worth Shs 182,326,440. Delays in completion of planned activities for two years may results into an increase of implementation cost facilitated by price movements of materials and overheads. The Council planned to implement two activities worth Shs 244,775,601 of which one activity for Shs 55,720,822 was partially implemented and another 149

162 activity for Shs 189,004,779 was not implemented. 73 Liwale DC There was an unspent balance of Shs. 618,768,201 which implies that most of the planned activities were not implemented. The Council planned to implement three projects worth 349,910,116 but they were not implemented up to 30 th June, The Council made payments amounting to Shs.59,497,938 for various WSDP activities without being supported with relevant documents contrary to Sec. 95(4) of PFR Nachingwea DC There was unspent balance of Shs.1,135,144, which implies that most of the planned activities were not implemented. There were expenditures amounting to Shs.4,525,000 which were not properly supported contrarily to Order No. 5 (c) of LAFM Ruangwa DC The Council had an unspent balance of Shs.680,085,245 which implies that the annual plan was not effectively discharged. 76 Masasi DC Approved budget of Water Sector Development Programme for the year under review was Shs. 874,055,500 where as the actual amount received was Shs.1,075,551,598 resulting to over release by Shs.201,496,098. There was an unspent amount of Shs.567,987,740 or 90% of the available funds which implies that planned activities of the same magnitude were not implemented. 77 Mtwara DC The Council had an unspent balance of Shs.688,422,800 which implies that most of the planned activities were not implemented. 78 Mtwara/Mikindani MC The Council had an unspent balance of Shs. 150

163 310,053,000 which implies that most of the planned activities were not implemented. The Municipal Council made payments amounting to Shs.3,003, for maintenance of motor vehicles without pre and post maintenance inspection report 79 Nanyumbu DC There was an unspent balance of Shs.663,083,584 equivalent to 76% of the funds available thus most of the approved activities were not implemented during the year. 80 Newala DC The Council had an unspent balance of TZS 675,431,145 which implies that most of the planned activities were not implemented during the year 81 Tandahimba DC The Council had an unspent balance of TZS 807,821,331 which implies that most of the planned activities were not implemented during the year 82 Bagamoyo DC Planned activities worth of Shs. 447,831,183 were not completed during the tear. 83 Kibaha DC Activities amounting to Shs.179, 253,409 remained unimplemented for two consecutive year s i.e from 2010/2011 to 2011/2012. In addition, activities worth Shs.277, 063,921 planned for the current year were also not implemented. 84 Kibaha TC Activities worth of Shs. 541,956,553 planned to be implemented during the year were not implemented and this implies that annual targeted objectives were not met.. 85 Kisarawe DC Unproductive drilled boreholes worth of Shs.93,983,75 Unutilized WSDP funds worth of Shs.192,691, Mafia DC Activities worth Shs.151,599,989 which were planned 151

164 to be executed during the year 2009/2010 remained unimplemented for two consecutive years up to 2011/ Mkuranga DC Planned and approved development projects were not performed as per action plans leaving an unspent balance of Shs.482,745,009 equivalent to 97% of the available funds which implies that most of the approved activities were not implemented. 88 Rufiji DC Planned activities worth of Shs.438,113,935 which were supposed to be implemented during the financial year 2009/2010 remained unimplemented for two consecutive years up to 2011/2012. In addition, activities worth Shs.478,650,012 earmarked to be implemented during the year under review 2011/2012 were also not implemented and therefore were rolled over to year 2012/ Kilombero DC The Council approved WSDP budget for financial year 2011/2012 was Shs. 426,394,000 while the actual funds received was only Shs. 5,648,000. Resulted into under release by Shs. 420,746,000. Rollover activities not Implemented Shs. 162,896, Kilosa DC Transfer of funds from WSDP account to General Fund account not reimbursed Shs. 7,845,000 The approved budget for WSDP financial year 2011/2012 was Shs. 176,426,000 while the actual funds received was only Shs. 5,648,000.This resulted to under released of Shs. 170,778,000. The Council received a sum of Shs. 1,669,367,232 for the construction of Kidete dam however, the amount was not included in the approved budget of the Council and this is contrary to Order No. 18(1) of the Local Government Financial Memorandum, Mvomero DC Expenditure amounting to Shs. 4,500,000 was charged to wrong account code contrary Section 43 (5) of the Local Government Finance Act No. 9 of 1982(Revised 152

165 in 2000) Payments amounting to Shs. 18,218,500 were made without being properly supported by relevant documents contrary to Order 8(2) (c) of LAFM (2009). Expenditure of Shs. 8,549,000 relating to different account were reflected in the cash books but the respective payment vouchers were not made available for audit contrary to section 45 (5) of the Local Authority Finance Act No.9 of 1982 (Revised in 2000). Funds were budgeted but were not received.the budget was worth of Shs. 558,306, Morogoro DC Funds budgeted for the WSDP activities not received Shs. 141,411, Morogoro MC Expenditure was debited to wrong account codes Shs. 16,576, Payment inadequately Supported Shs. 2,119,552. Funds budgeted but not received Shs. 157,021, Ulanga DC Expenditure charged to wrong account code Shs. 615,274 Activities not Implemented during the current year totaling to Shs. 356,300,024 Funds budgeted but not received Shs. 145, 418,339 Delayed transfer of funds from Development Account to WSDP account worth of Shs.265,638, Namtumbo DC The Council had an unspent balance of Shs. 600,303,242 which implies that most of the planned project activities were not implemented during the year. Payments amounting to Shs. 2,205,000 were erroneously charged to wrong GFS codes contrary to Order No.23(1) of LGFM of Payments amounting to Shs.27,478,000 were not pre-audited contrary to Order No. 10(2) of the LGFM Review of the Council s contract documents, contract files and payment vouchers noted that some 153

166 projects were not completed on time and no action were taken by the Council which is contrary to Reg.119 of the PPR, (c) Councils Issued with Qualified Opinion Twenty five (25) Councils have been issued with qualified audit opinion which is 19% as shown in Table 40 below: Table 40: Councils Issued with Qualified Opinion 1 Bahi DC The property, plant and equipments overstated by Shs.64,290,107. This overstatement is due to non inclusion of depreciation during the year of the same amount for buildings and plant machinery and equipment, thus consequently understating the net income in the statement of financial performance. Deferred revenue grant for the year 2010/2011 was Shs.198,167,958 as shown in Note No. 1 but the comparative amount presented in the year 2011/2012 was Shs.160,562,273 leading to an understatement of Shs.37,605,685. Accounting policies and a summary of explanatory notes are part of the financial statements according to IPSAS 1 Para 128. Our review of the financial statements revealed that explanatory notes for recurrent grants of Shs.135,282,021 were not included in the notes to the financial statements. 2 Chamwino DC The council understated the opening balance of Accumulated Surplus by Shs.5,141,745 The Council reported allowances balance as Shs. 12,580,000 in the Statement of Financial Performance while the actual figure was Shs. 18,334,000. This means that the Wages, Salaries and Employee benefits balance in terms of allowances were understated by Shs. 5,754,000. The Council reported Supplies and Consumables 154

167 expenditure of Shs. 87,219,719 in the Statement of Financial Performance while there were no payments in respect of Supplies and Consumables during the reporting period. This has misstated the Statement of Financial Performance. The Council reported maintenance expenditure of Shs. 27,973,050 in the Statement of Financial Performance instead of the actual maintenance expenditure of Shs. 9,135,000 thus causing an overstatement of maintenance expenditure by Shs. 18,838,050. Procured items worth Shs. 9,135,000 were noted to have not been recorded in stores books. This implies that the items might not have been used for project purposes. 3 Dodoma MC The Council has not disclosed in its financial statements the non current assets whose value was not obtained. The undisclosed assets were noted to be: Toyota Land Cruiser, 2 Motorcycles and 1 computer. The Council has not disclosed the accounting policies underlying the preparation of financial statements. In the absence of accounting policies it was difficult to determine how the balances constituting the financial statements were derived. 4 Kondoa DC The opening balance of the amortization of capital grants amounting to Shs.27,293,971 was omitted from the statement of financial performance -. The opening balance of the maintenance expenses amounting to Shs. 4,899,000 was understated by Shs.89,999 as compared to the last year s closing balance of Shs.4,988,999. The calculated depreciation charge of Shs.96,919,089 in the schedule of PPE was not reflected in the statement of financial performance. The reported figure of carrying value of PPE was overstated by Shs.57,773, as the amount reported was Shs.485,201,796 whereas the actual amount on recalculation should be Shs.427,428, Overstatement of cash and cash equivalents by 155

168 Shs.482,000,000 as funds transferred to deposit account were included in other financial assets as well as in cash and cash equivalents of Shs 7,091,392 thus making a total of Shs.489,091,392 as per Note 21, leading to an overstatement of Shs.482,000,000. Increase in inventories has been overstated by Shs.183,251,696 in the statement of cash flows. The opening balance stated in the 2011/12 financial statements of Shs 489,091,392 differs from the closing balance stated in 2010/11 financial statements of Shs 316,456,485 by Shs.54,497, Kongwa DC The Council reported depreciation of Shs.15,547,754 after using annual rate of depreciation based on the life span of 25 years for Water System. However, review of the summary of significant accounting policies noted that, the Water systems are required to be depreciated over the useful life of 15 years which resulted into depreciation amount of Shs.25,912,923. Calculated based on the Cost/Revaluation value of Shs.388,693,846. The use of wrong depreciation rate resulted to understatement of depreciation charge by Shs.10,365,169 that is ( Shs.25,912,923-15,547,754). The Council received capital grant during the year of Shs.457,831,379, which was not recorded in the amount of deferred income for capital grants as additions during the year. Therefore, the amount of closing balance reflected in the statement of financial position of Shs.357,598,338 was understated by Shs. 457,831,379. The financial statements reported Maintenance expenses as Shs.2,304,766 while the amount shown in the statement of financial performance was Shs.273,126,250 thus resulting into a misstatement of Shs. 270,821,484. The financial statements reported Grants and other transfer payments of Shs.1,010,000 while the amount shown on the face of the statement of financial performance was Shs.149,282,712 thus resulting into 156

169 misstatement by Shs.148,272,712. The Council made payments amounting to Shs.69,665, which were not properly coded, resulting into a misclassification of expenditure contrary to IPSAS principles. The cash flow statement was not correct because of the effect of charging wrong depreciation as reflected above, and the increase or decrease in deferred revenue grant was not included in the cash flow statement. The council presented two different financial statements which are statement of financial performance by nature and by function that have different amounts for expenses. 6 Kasulu DC Expenses was understated by Shs. 47,700,949, due to; overstating employee benefits Shs.(23,907,500), understated supplies and consumables used Shs. 61,809,000 and maintenance expenses Shs. 9,799,4449. Understatement of Revenue in the statement of financial performance by Shs. 47,700,949 as the Council reported that the balance amortized in respect of recurrent grants was Shs. 33,000,000 instead of the correct amount of Shs. 80,700,949. Non disclosure of schedule for property, plant and equipment in the notes Shs.1,325,966,609 7 Kigoma MC Omission of PPE worth Shs.160,196,000 from the financial statements as the previous year s financial statement had a closing balance of PPE of Shs.160,196,000 while current year's statements reflected a nil balance and no evidence of disposal of PPE was provided. Grants amounting to Shs. 413,785,622 received during the financial year have been omitted in the financial statements. The Council should have reported it as recurrent grants or capital grants in current financial statements. 157

170 8 Karagwe DC There were differences between last year s reported figures and comparative figures presented in the financial statements of WSDP for the year 2011/2012. Non preparations of IPSAs compliant financial statements due to lack of Notes which form part of the financial statements prepared. 9 Magu DC The Council spent a sum of Shs. 64,477,295 for other activities under CDG and CBG of Water Sector Programme without approval from the respective authorities such as Council s Finance Committee and the appropriate Ministries contrary to sec. 4.2 and 4.3 WSDP- Memorandum of Understanding. Delay in supervising the consultant for provision of technical and facilitation consultancy services for rural water supply and sanitation sub project lead to a loss of Shs. 50,727, due to exchange rate change. 10 Missungwi DC The non current assets were understated by Shs.109,517,262 due to the fact that the carrying amount of the water system was reflected as Shs. 535,635,809 being the cost of the Water system from July, 2011 instead of Shs. 650,917,139 arrived at as per IPSAS.17(43). The Treasury released funds amounting to Shs. 5,648,000. However, the funds were not transferred to respective WSDP account. 11 Mwanza CC The Council charged depreciation amounting to Shs 127,546,372 in respect of Work-in-Progress (water boreholes) contrary to IPSAS 17 which requires an entity to depreciate an item of property, plant and equipment when it is available for use and to continue depreciating it until it is derecognized. The Council incurred expenditure of Shs.69,208,165 from WSDP for construction of rain water harvesting systems at Ibinza and Shibula secondary schools and improvement of Nyashana spring. However, those 158

171 activities were not budgeted in the WSDP for the year under review. A sum of Shs. 9,617,000 was drawn from RWSSP account and paid to Water account as a loan for Water borehole drilling at Sangabuye dispensary, however, the same had not been refunded as at the end of year. 12 Ukerewe DC There was a depreciation charged to work in progress amounting to Shs. 108,797,652. Receivables and Prepayments amounting to Shs. 4,210,000 were not supported by age analysis. 13 Karatu DC Figures disclosed in the financial statements do not have explanatory notes. Statement of changes in Net Assets /Equity was not prepared. The Council reported a deficit of Shs.30,326,100 and recorded depreciation charges of Shs.47,742, When making adjustment in the statement of cash flow results could have been Shs.17,416, instead of deficit of Shs.78,068, as reported by the Council. 14 Monduli DC Payment vouchers worth Shs.1,050,000 were missing in their respective batches. There was improperly expenditure of Shs.1,362,500 as the relevant supporting documents were not attached to the respective payment vouchers. 15 Babati TC Understatement of value of PPE by Shs.40,299,167 due to overcharging depreciation. Payment amounting to Tshs.1,707,703 was not supported by proper documents in the absence of which propriety of the claims cannot be ascertained. A sum of Shs.463,973, equivalent to 81% of the available funds for the year was left unutilized at the end of the financial year. The internal auditor of the council did not audit and prepare Internal Audit Reports in respect of WSDP for year 2011/2012 as required by Memorandum of 159

172 Understanding (MoU). 16 Hanang DC The Council had a negative balance of Shs. 4,361, after receiving Shs 5,648,000 for implementing WSDP activities. However, the actual expenditure during the year was Shs. 525,000 indicating that a negative balance of Shs 4,886, left on account. The cash flow statement disclosed Shs. 188,780,000 as an acquisition of Property Plant and Equipment. It was noted that such amount was not paid for the year under review, instead the Council still owed such amount which is presented in the payable. Therefore there was no cash movement during the financial period 2011/ Handeni DC Cash and cash equivalents in the Statement of Financial Position as at 30 th June, 2012 was understated by Shs.78,153, Kilindi DC The Council understated property, plant and equipment by Shs. 70,341,902 as the reported opening figure was Shs.405,317,546 instead of Shs. 475,259,448. Non-disclosure of expenditure line items in the Statement of Financial Performance Shs.76,461, Pangani DC The financial statement for 2011/2012 reflected that the carrying value of assets for 2010/2011 was Shs. 743,443, while the presented value in the statement of financial position page 11 shows Shs. 838,800,946.Therefore assets were overstated by Shs. 95,357,278. Revaluation surplus of Shs. 306,929,000 was not included in the statement of financial position. Statement of financial performance shows a deficit of Shs. 96,162,080 while in actual fact it is not supposed to have deficit. 20 Mbeya CC Amount of Shs.113,998,000 for consultation services 160

173 was not disclosed in the cash flow under cash flow from investing activities. Statement of capital expenditure and its financing were not attached. Amount of Shs.61,700,986 as the accumulation from previous years for RWSSP were not disclosed in the financial statements for the year ended 30 th June, Amortization of Recurrent Grant under Note 11 was shown in the financial performance as Shs.51,367,680 instead of Shs.27,979,650 resulting to overstatement of Recurrent Grant by Shs.23,388, Mbozi DC The submitted statement of capital expenditure and its financing includes LGCD funds amounting to Shs.116,392,190 leading to overstatement of capital receipts by the same amount. The statement of capital expenditure and its financing disclosed Shs.1,758,642,126 as development grants received during the year, while in cash flow statement the amount disclosed as development grant received during the year was Shs.1,496,248,000. Therefore the figure for capital grants received was understated by Shs.272,394,126 in the cash flow statement. Amortization of recurrent grants of Shs.166,809,407 as reported in the statement of financial performance could not be confirmed due to the limitation of the prepared Note No. 1 Pg 5 of the submitted financial statements which had no comparative figures and not elaborated. Amortization of capital grant was not reported in the statement of financial performance despite of having PPE with a balance of Shs.470,013,410. The figure of cash and cash equivalent of Shs.1,545,045,365 was overstated by Shs.54,000,000 due to wrong opening balance carried forward from the year 2010/11 of Shs.342,569,453 instead of Shs. 161

174 288,569, Mpanda TC Inventories worth Shs.98,497,550 which were disclosed in the statement of financial position differs by Shs.75,199,687 with the corresponding figure of Inventories shown under Note 5 of Shs.23,297,864 Amortization of Capital Grant has been disclosed twice under Note 10 (Shs.215,028,340) and Note 6 (Shs.11,265,256) which makes a total amortization of Capital Grant of Shs.226,293,596. This amount do not match with the depreciation charge during the year of Shs.11,265,256 thus overstating the reported amortization by Shs.215,028,340. Supplies and consumables of Shs.25,766,304 which was disclosed in the statement of financial performance differs by Shs.23,297,864 with the figure of supplies and consumables shown in Note 3 of Shs.2,468,440. Statement of financial position as at 30 June, 2012 shows that, there is an increase in Inventory to the tune of Shs.23,297,864. However such transaction has been disclosed in cash flow statement as decrease in Inventory by Shs.51,901,822 hence understating the changes in inventory by Shs.75,199, Nkasi DC Amortization of Recurrent Grant for the year 2011/2012 was disclosed in the statement of financial performance as Shs.235,000,000 while in Note 11, the item is shown as Shs.125,479,735,thus the Recurrent Grant Amortization was overstated by Shs.109,520,265 in the statement of financial performance for the year 2010/11. The effect of change in deferred recurrent grant income of Shs.15,266,494 reflected in the statement of financial position has not been recorded in the cash flow statement. Increase in deferred capital grant of Shs.426,140,051 from Shs.35,204,625 in 2011 to Shs.461,344,676 in 162

175 2012 was not disclosed 24 Sumbawanga MC The reported cash balance in the statement of financial performance as at 30 th June, 2012 of Shs.191,309,715 differs with balance as per cash book in WSDP account of Shs.185,773,809 by Shs.5,535,906. Notes for cash and cash equivalent, receivables, payables, prepayments, Deferred Income and capital grants and undescribed items of subsidiary ledger were not submitted along with the financial statements. Comparative figures in respect of financial year 2010/11 transactions were not disclosed. Amounts for amortization of Capital Grant during the year 2011/12 as well as depreciation charge during the year were not provided. Workings for property, plant and equipment was not provided for justification of capital expenditure of Shs.50,147, Kibondo DC The Council had not prepared statement of capital expenditure and its financing as a note to support the negative balance of cash flow from financing activities of Shs. 219,820,000. Funds transferred to other account not refunded Shs. 5,600,000 thus affected the implementation of the planned activities. Payments of Shs. 2,830,000 were not supported by relevant documents contrary to Order No.8 (c) of Local Authority Financial Memorandum of (d) Council issued with Adverse Opinion One (1) Council has been issued with an adverse audit opinion which is 0.76% as shown below: 1 Chunya DC Cash and cash equivalent stated in both the statement of financial position as well as in cash 163

176 flow statement was over stated by Shs.134,954,583. Payment vouchers amounting to Shs.58,443,852 were not produced for audit contrary to Order No. 8 (2) (c) and Order No. 104 of the Local Government Financial Memorandum, Funds amounting to Shs.197,934,966 was transferred from WSDP account to other accounts during the year. However, the amount has not been refunded back to the WSDP account. Expenditure stated in the financial statement was understated by Shs.99,437,704. (e) Councils not Allocated Funds Four (4) Councils were not assessed and therefore not issued with any audit opinion since they were not allocated any funds as shown below: 1. Kondoa TC 2. Musoma MC 3. Masasi TC 4. Dar es Salaam CC 4.2 OTHER DONOR FUNDED PROJECTS Introduction Ninety three (93) Donor Funded Projects including World Bank (IDA), Global Fund, UNDP, AfDB and other projects were audited during the year Summary of audit opinions issued to other Donor Funded projects and the reasons which gave rise to the issuance of such opinion is as shown in Table 42 below:- (a) Projects issued with Unqualified Opinion without Emphasis of Matters The following 68 other donor funded projects have been issued with Unqualified Opinion without Emphasis of Matter as shown in Table 40 below: 164

177 Table 42: Other Projects issued with Unqualified Opinion without Emphasis of Matters 1 Facility for Ethics Accountability and Transparency (FEAT) 2 TZ- Private Sector /MSME Competitiveness BEST & TPSF The private Sector Competitiveness Project (PSCP) Component 1 Coordination Units and Better Regulation Section IDA CREDIT NO TA 3 TZ-Performance Results & Accountability (Public Sector Reform Programme ) 4 TZ-Sustainability Mgt of Min.Resourses TAL (SMMRP) 5 The Science And Technology Higher Education Project (STHEP) 6 TZ- Financial Sector Support Project 7 TZ-Energy Development & Access Expansion MEM 8 TZ-Energy Development & Access Expansion Project (TEDAP) IDA Credit No (Part A C.1)-TANESCO 9 Housing Finance 10 Basic Health Services Project 11 Lake Tanganyika Integrated Regional Development Programme 12 Legal Sector Reform Programme 13 Africa Stockpile Program 14 Eastern Africa Trade and Transportation SUMATRA 165

178 15 East Africa Agriculture Productivity Program APL 1 16 Regional Communication Infrastructure Program 17 Tanzania Extractive Industries Transparency Initiative (TEIT) 18 Tanzania Extractive Industries Transparency Initiative (TEIT) Grant no Rural food fortification Project 20 Tanzania Global Development Learning Centre 21 TZ-Agr Sec Dev (FY06)(ASDP) PMO - RALG 22 Health Sector Program Support PMO-RALG 23 Local GovernmentTransportProgramme&VillageTravelling Transport Pmo Ralg ComPONENT 24 Livestock Development Fund PMO-RALG Component 25 Rural Energy Agency Project 26 Support to Maternal Mortality Reduction Project No.P- TZ- IBO Small Entrepreneurs Loan Facility II (SELF) 28 Singida Babati Minjingu Road Project 29 National Museum and House of Culture Project 30 Sida/NORAD/MEM -Biofuel Project 31 East Africa Trade and Transport Facilitation Project 32 Public Services Reform Programme (PSRP)- Holding account 166

179 33 Local Government Reform Programme(LGRP) Holding Account 34 Tax Modernization Basket Fund (Holding Account) 35 Water sector Basket Fund(Holding Account) 36 National Rural Water Supply and Sanitation Basket Fund(Holding Account) 37 Health Basket Financing Fund(Holding Account) 38 Legal Sector Basket Financing Fund (Holding Account) 39 The Policy for Human Resourses Development (PHRD) Agricultural Sector Development Programme Basket Fund (Holding Account) 40 Financial Sector Support Basket Financing (Holding Account) 41 Secondary Education Plan PSSEDP (Holding Account) 42 The STATCAP Basket Fund(Holding Account) 43 The Secondary Education Development Programme II (Holding Account) 44 Vice President s Office (UNDP) 45 Second Vice President s Office Zanzibar(UNDP) 46 Prime Minister s Office Regional Administration and Local Government(UNDP) 47 Population Services International (UNDP) 48 First vice President s Office Zanzibar (UNDP) 167

180 49 National Bureau of Statistics (UNDP) 50 Tanzania Food and Drugs Authority(UNDP) 51 Ministry of Health and Social welfare (UNDP) 52 Registration, Insolvency and Trusteeship Agency( UNDP) 53 Ministry of Education and Vocational Training-Zanzibar(UNDP) 54 Ministry of Health and Social Welfare-Environmental Health (UNDP) 55 Ministry of Social Welfare, Youth, Women and Children Development-Zanzibar (UNDP) 56 Ministry of Education and Vocational Training (UNDP) 57 Elizabeth Glaser Paediatric AIDS Foundation, (UNDP) 58 Vice President s Office National Environmental Management Council (UNDP) 59 Save the Children (UNDP) 60 Medical Women Association of Tanzania (MEWATA)(UNDP) 61 Makete District Council-(UNDP) 62 Prime Minister s Office (UNDP) 63 Tanzania Forest Fund- TFS (UNDP) 64 Ministry of Water (UNDP) 65 Ministry of livestock development and fishers (UNDP) 66 Mother 2 mother (UNDP) 67 Tanzania Food and Nutrition Centre (UNDP) 168

181 68 Global Fund for the Ministry of Health and Social Welfare (b) Other Projects issued with Unqualified Opinion with Emphasis of Matters The following 22 other donor funded projects have been issued with unqualified opinion with emphasis of matters and reasons thereof for such opinion are given as reflected in Table 43 below: Table 43: Projects issued with Unqualified Opinion with Emphasis of Matters 1 TZ-Loc Govt SIL (FY 05) PMO-RALG & DAR PST According to the World Bank client connection the signed amount of the loan is USD 103,348, while the disbursed loan is USD 100,143, resulting into undisbursed loan of USD 3,204, which is equivalent to Shs. 5,000,000,000. The loan value to be repaid should be USD 100,143, and not the signed amount of USD 103,348, DAR Rapid Transport (DARTS) The Agency spent Shs. 169,381,739 for allowances that lacked proper approval of the MAB, PMO-RALG and PO-PSM and were not reflected in the Agency budget for 2011/12. The Agency prepared relocation payment schedule amounting to Shs.8,790,162,620 for the Gerezani project affected people while the report prepared and approved by the Chief Government Valuer for the same people reflected only Shs.2,620,488, District Health Infrastructure Rehabilitation PMO- RALG -Component The liability outstanding from the previous year amounting to Shs.43,807,500 was neither reflected in the financial statements for the financial year 2010/2011, nor budgeted for, hence has an impact on the implementation of current year activities. 4 East Africa Public Health Laboratory Networking Project Under IDA Credit Number

182 Under utilization of allocated funds to the project Shs. 3,634,121,925 or equivalent to 86.2% of the released funds were not utilized as a result; the implementation of the respective approved activities could not be achieve. 5 District Agriculture Sector Investment Project (DASIP) The amount of Shs.9,775,000 transferred to Misungwi and Geita District Councils for various DASIP activities, and also released Shs.31,896,000 to different District Councils for Motorcycles and field allowances, amount was not traced in the Bank statements. Funds disbursed amounting to Shs. 1,495,173,000 for various districts for implementation of projects but the implementation had not started as at September 2012 since last financial year (2010/2011). Projects not yet implemented were as follows:- 2010/2011Worth Shs.695,572, /2012Worth Shs.799,601,000 6 Central Corridor Transit Transport Facilitation Agency Going concern of the Agency is not certain as the contracting parties (the partner states) have not implemented any financial sustainability strategy as per Article 24.2 of CCTTFA to ensure sustainability of the Agency after AfDB financing comes to an end. 7 Local Government Support Project IDA Credit No According to the World Bank client connection the signed amount of the loan is USD 103,348, while the disbursed loan is USD 100,143, resulting into undisbursed loan of USD 3,204, which is equivalent to Shs. 5,000,000,000. The loan value to be repaid should be USD 100,143, and not the signed amount of USD 103,348,

183 8 The Second Centre Transport Corridor Project Credit No Delay by TANROADS to handover site areas to the Contractor including Jangwani Bridge, City Counci Station, Ubungo bus terminal, Kimara Termina which has led to substantial delay in the commencing of the works. Package2- Construction of Ubungo Depot, Ubungo Feeder station and Ubungo up-country bus station contract sum Shs.2, 201,086,467. The contract TRD/HQ/1020/2011/12 was signed on 9 th August 2010 with Beijing Construction Engineering Group Co but has not yet started as of November, Package 5- Construction of Kariakoo Terminal and Feeder station- Contract price Shs.6,348,331,889 The contract no TRD/HQ/1012/2010/11 signed on 9 th August, 2010 with Beijing Construction Engineering Group Company Ltd but has not yet started the work to date. Compensation of loss due to delayed works Shs.174,573,138. Under contract TRD/HQ/1038/2010/11 China Civil Engineering filed compensation claim to TANROADS for seven months i.e 11 th April, 2011 to 24 th November, 2011 at Jangwani open space which literally amounts to nugatory expenditure. 9 TZ-Strategic Cities Project The payment for Shs.6,277,500 in respect of trip of Kigoma Morogoro kigoma was unnecessary and no justification for expenditure on hiring a motor vehicle for purpose of providing transport service for participants who had study tour from Kigoma to Dar es salaam (Ubungo Bus Stand) to study how Bus stand revenue collection is managed and from Kigoma to Morogoro to study solid waste composition in Morogoro Municipal Council. 10 Road Sector Support Project I (RSSPI) Slow implementation performance of Namtumbo - Tunduru Road (193 km). It is evident that the contractor has failed to deliver as the result the 171

184 employer (ie. TANROADS) intends to terminate the contract. 11 Rural Water Supply and Sanitation program II (water Sector Component) (RWSSP) Funds for RWSSP activities amounting to Shs. 4,870,000 were spent for activities not related to RWSSP. PMO RALG s Management received services and the corresponding Invoices worth Shs.7,137,767 before raising the relevant LPOs 12 Market, Infrastructure, Value Addition and Rural Finance Support Programme (MIVARF) The Marketing, Infrastructure, Value Addition and Rural Finance Support Programme (MIVARF) received a total of Shs. 9,590,878, which was released by the development partners. However, only Shs. 3,654,443, which is equivalent to 38% of the released fund was utilized leaving a balance of Shs. 5,935,194,119 (62%) idle. 13 The private Sector Competitiveness Project (PSCP) Component 2 Enterprise Development Under The TZ Private Sector Foundation IDA CREDIT NO, 4136 Items procured but not in use USD 626, TZ: Accelerated Food Security Project Wrong amount of vouchers to be redeemed by NMB Shs 159,620,000 Incorrect Face Value of vourchers applied Shs.407,440,000 Over execution of works contrary to the contract agreements Shs.40,802, Teaching and Learning Science,Mathematics and English in Government Secondary Schools in Project using ICT The project did not maintain and prepare proper cash book and bank reconciliation statements. As a result the financial statements reported a closing balance of Tzs.64,544,304 while the bank 172

185 statement reported Tzs.95,008, TZ-Marine & Costal Env Mgmt SIL (FY06) TZ Mainland & Zanzibar GEF (MACEMP) Ineligible expenditure of VAT Shs.124,776,801 Fishing landing site has been completed but not operating at:- i) Kilwa Masoko Pwani which costed Shs.155,444,025 ii) Nyamisati which costed Shs.125,008, Uncompleted and sub standard construction works at Tumbe, Pemba Shs.263,824,666. Non establishment of Marine Legacy Fund. 17 Lake Victoria Environmental Project (LVEMPII) Slow performance of Consultancy Service Contract No.ME-011/2011/2012 of 24 th January, 2012 for consultancy services to design and supervise construction of sewerage system in Mabatini and Igogo in Mwanza City awarded to M/S Beomhan Engineering and Architects Co Ltd with association with DOCH Engineering and Management consultants Box 1767 DSM for Shs.77,809,000 for 12 weeks i.e 1/4/ /12/2012. To the date of this report the work in not completed. Uncompleted Projects Shs.109,206,137 - Purchase of Glass Bond and diesel engine Shs.41,206,137, Sunguti Village not done - Rehabilitation of charcoal dam, at Bubinza Village, Magu District for Shs.32,000,000 not completed. - Contraction of charcoal dam at Mwamkale Village, Magu District for 36,000,000 not completed. 18 Health Systems Strengtherning Global Fund Round 9 (HSSGFR9). Shs. 4,435,531, which is equivalent to 36% of the availed funds was not utilized during the year, this implies that the approved programme activities were affected by this shortfall. 173

186 19 Monitoring and Evaluation Global Fund Round 8 (MEGFR8) Shs 58,774,401 which is equivalent to 57% of the availed funds was not utilized during the year, this implies that the approved programme activities had been affected to the same magnitude. 20 The Marine and Coastal Environment Management Project IDA Credit No Incompleted and irregular payments of Construction of Mvuvi House The Ministry of Livestock Development and Fisheries entered into a contract No.31 of 2009/2010 with M/s. CATIC International Engineering (T) Ltd, Box 11600, Dar es Salaam to construct an office building (Mvuvi House) a one building with three storeys and one ancillary building that is a godown at a contract sum of Shs.3,534,145, The contract agreement was signed on 26 th February, 2010 and according to notification of award of the contract referenced CAB 68/544/02/68 of 25 th February, 2010 and the construction period was Eight Calendar months therefore the works was supposed to be completed in November, During the year under review a sum of Shs.1,132,212, was paid to M/s. CATIC International Engineering (T) Ltd. 21 The National AIDS Control Programme (NACP) Global Fund Round 8 During the audit of payment vouchers; it was revealed that expenditure amounting to Shs. 1,109,746,805 was not fully supported by proper documents, contrary to Regulation 95(4) of the PFR of 2001 (revised 2004). 22 National Multi Sectoral Framework (NMSF) Reg.49(1) of Public Finance Regulations 2005 requires any further disbursement in respect of a service which could not have been foreseen, or cannot be postponed without detriment to the public service, or cannot appropriately be charged to an existing item of the estimates, or which would cause an excess thereon, prior approval to 174

187 seek authority for such expenditure shall be sought, Contrary requirement to this an audit test of the payment vouchers observed that, Shs. 8,689,997 was paid for various activities during the year 2011/2012 and, the payments were charged into wrong accounts codes. (C) Other Project issued with Qualified Opinion Three (3) other donor funded projects were issued with Qualified Opinion are shown in Table 44 below Table 44: Three other donor funded projects issued with Qualified Opinion 1 Tanzania Commission for AIDS (TACAIDS)- UNDP TACAIDS management showed weakness in contract supervision to extent that up to the time of audit (May,2012) four consultancy service agreements worth shs.20,800,000 were not completed on time (delayed for 61 days),no reports were produced as deliverables contrary to the signed agreement, and the reviewed progress reports were found invalid as they had no signature of preparer Inconsistencies in the reported expenditure between the FACE forms and cash book submitted for audit Shs. 288,381,371.95: Inconsistencies in the financial statements reported figures for opening balance not reflecting the actual amounts, the reported UNDP component for receipts understated by 75,000,000, and total payment for UNFPA incorrectly stated as 171 million instead of 103 million. 2 Temeke Municipal Council FACE forms amounting to TZS. 100,904,500 were not supported by activity reports. Payment worth TZS. 71,715,000 were not adequately supported by third part documentation Discrepancies were noted between expenditure reported in FACE forms, expenditure recorded in the EPICOR accounting system and expenditure contained in the progress report. The Council reported 175

188 expenditures with a total of TZS 582,226,000 on FACE forms, expenditure with a total of TZS 258,072,500 on activity progress reports and expenditure with a total of TZS 623,946,000 as per cash book from the EPICOR system. We are therefore not certain on the accuracy and completeness of the reported expenditure in the Statement of Receipts and Payments for the year ended 31 December Ministry of Energy and Minerals Payment vouchers and their supporting documents amounting to USD 493, were not produced to audit when requested. This amount involved funds received during the year under review from 1 st January 2011 to 31 st December

189 CHAPTER FIVE 5.0 Introduction REVIEW OF PROCUREMENT PROCESSES During the course of audit in the financial year 2011/2012, I observed anomalies in the procurements of goods and services made by Tanzania Social Action Fund (TASAF), Agricultural Sector Development Programme (ASDP), Water Sector Development Programme (WSDP), Health Basket Fund (HBF) and Other Projects. The anomalies observed are centered on non compliance with the PPA of 2004 and Public Procurement Regulations (GN. No.97 & 98 of 2005 and GN. No. 177 of 2007) as narrated below: 5.1 Agricultural Sector Development Programme (ASDP) Store items not taken on ledger charge Shs. 22,018, Stores records were not maintained properly to keep trail of inventory movement. Consequently, final disposal of goods worth Shs. 22,018, could not be ascertained. Following review of store records, seven (7) councils had items not taken on ledger charges as detailed in Table 45 below: Table 45: Store items not taken on ledger charges S/N Council Amount (Shs) 1 Kyela DC 6,171, Nachingwea DC 4,472, Kahama DC 3,149, Kilosa DC 2,802, Hanang DC 2,752, Arusha DC 1,710, Mafia DC 960, Total 22,018, This lapse might result into misuse of resources without being detected. 177

190 5.1.2 Goods paid for but not delivered, Shs. 76,546,863 Payments amounting to Shs. 76,546,863 were made in advance to various suppliers using ASDP funds during the year under review. However, the goods were not delivered contrary to Order No. 71(1) (b) of the LGFM, Eight (8) Councils, and the amounts involved are shown in Table 46 below: Table 46: Goods not delivered District Amount (Shs) 1 Chato DC 4,000,000 2 Ileje DC 18,000,000 3 Manyoni DC 11,415,000 4 Mbulu DC 855,000 5 Meatu DC 18,750,000 6 Mtwara DC 152,863 7 Mwanza CC 4,708,000 8 Tarime DC 18,666,000 Total 76,546, Goods procured without Tender Board approval,shs. 270,102,712 Many procurement arrangements often fall short of the contracted roles and responsibilities because of poor contract management. Contract management is the process that enables both parties to a contract to meet their obligations in order to deliver the objectives required from the contract. In this regard, I noted cases where seven (7) Councils procured goods worth Shs. 270,102, from suppliers without approval from established Tender Boards contrary to Reg. 40 and 41 of the PPR of 2005 which requires any procurement to be authorized and approved by the Accounting Officer and endorsed by a Tender Board. Councils involved are detailed in Table 47 below: 178

191 Table 47: Goods procured without Tender Board approval S/N Council Amount (Shs) 1 Chamwino DC 40,629,617 2 Mkuranga DC 50,976,000 3 Mtwara MC 23,610,000 4 Mufindi DC 27,308,068 5 Muleba DC 60,886,527 6 Rorya DC 61,912,500 7 PMO-RALG 4,780,000 Total 270,102, Procurement of goods without competitive quotations, Shs. 252,937,907 Compliance is an important aspect of procurement process in getting economic prices from the service providers. Reg. 28 of the PPR, 2005 and First Schedule of the Local Government Authorities Tender Boards Regulations, 2007 requires the Accounting Officer and Heads of Departments to obtain the minimum of three quotations from different sources in order to arrive at the competitive price. However, eight (8) procuring entities purchased goods worth Shs. 252,937,907 without obtaining at least three quotations from potential suppliers consequently; opportunity to have a reasonable price might not be realized. Details are as shown in Table 48 below: Table 48: Procurement without competitive quotations S/N Council Amount (Shs) 1 Arusha MC 1,829,000 2 Babati DC 7,462,600 3 Chamwino DC 49,273,662 4 Kinondoni MC 30,045,632 5 Kongwa DC 13,600,000 6 Masasi DC 98,640,700 7 Shinyanga MC 1,884,500 8 Urambo DC 50,201,813 Total 252,937,

192 5.2 Health Basket Fund (HBF) Goods paid for but not delivered, Shs. 180,703,985 Goods worth Shs ,985 were ordered and paid for by six(6) Councils during the year but were not delivered contrary to the PPR No.122.The detailed analysis of these findings is reflected in the individual management letters issued to each Council. Summary is shown in Table 49 below: Table 49: Goods paid for but not delivered S/N Council Amount (Shs.) 1 Kinondoni MC 30,858,300 2 Magu DC 2, 875,200 3 Kwimba DC 5,000,000 4 Mwanza CC 109,101,100 5 Hanang DC 4,185,000 6 Babati TC 28,684,385 Total 180,703, Procurement of medical supplies without MSD approval, Shs. 412,219,600 Audit noted that, medical items worth Shs. 412,219,600 were procured by ten (10) councils as shown in Table 50 below, from private suppliers and without MSD approval contrary to Sect.4 of the Local Authorities Tender Boards (establishment and proceedings) Regulations, Table 50: Procurement without MSD approval S/N Council Amount (Shs.) 1 Ilala MC 127,183,300 2 Kilosa DC 62,600,630 3 Ulanga DC 14,769,000 4 Kibaha TC 27,363,530 5 Magu DC 4, 740,000 6 Kwimba DC 11,900,000 7 Mwanza CC 71, 806,

193 8 Arusha MC 47,570,500 9 Simanjiro DC 14,678, Tandahimba DC 29,510,000 Total 412,219, Procurement of goods from unapproved suppliers, Shs.121,391,503 Regulation No. 68(5) of Public Procurement Regulations of 2005, requires the list of the suppliers selected to be submitted to the appropriate tender board for approval and thereafter the procuring entity shall address a request for quotations to all approved suppliers simultaneously. However, contrary to Regulation No. 68(5) of Public Procurement Regulations of 2005 six Councils procured goods, works and non consultants services from suppliers neither approved by the Government Service Procuring Agency (GPSA) nor the Council Tender board. The details of procurement made are explained in Table 51 below: Table 51: Procurement of from unapproved suppliers S/N Council Amount (Shs.) 1. Kibondo DC 5,277,000 2 Nzega DC 56,159,000 3 Kyela DC 18,124,250 4 Mbarali DC 4,223,500 5 Rombo DC 8,992,753 6 Kilwa DC 28,615,000 Total 121,391, Tanzania Social Action Fund (TASAF) Goods paid for but not delivered, Shs. 47,874,230 Audit test on procurement system and receiving of goods paid for revealed weaknesses such as uncompetitive procurement, purchases without planning since items procured were not delivered, or were partly delivered or were not accounted for in full in the stores ledgers as was observed in ten (10) Councils. Detailed analysis of these 181

194 findings is reflected in the individual management letters issued to each Council and summarized in Table 52 below: Table 52: Goods paid for but not delivered S/No Council Amount (Shs.) 1. Monduli DC 2,100, Muheza DC 3,329, Kilwa DC 2,297, Lindi DC 1,313, Nachingwea DC 1,686, Dodoma MC 3,886, Kigoma/Ujiji MC 12,004,000 8 Ngara DC 4,757,566 9 Mtwara DC 5,925, Chunya DC 10,575,000. Total 47,874, Procurement made without prior approval of the Community Management Committees, Shs.5,880,500 Procurement worth Shs. 5,880,500 was made by local technicians through Capacity Enhancement account for projects carried in the villages without prior approval of the Community Management Committees(CMC) and Village Councils(VC).This is contrary to Para of the TASAF II Operational Manual Unproduced Bill of Quantities for the works worth Shs. 76,512, A site visit was made to six sites with the aim of assessing the physical status of the implemented activities and to confirm if the construction was done in accordance with the approved BOQ (contractual agreement). At the six (6) sites visited, we were not furnished with the Bill of Quantities therefore we were unable to measure the extent to which the work was performed. The list of the sub projects are as shown in Table 53 below: 182

195 Table 53: Unproduced Bill of Quantities S/N Location Project Name Amount (Shs.) 1 MGEO CONSTRUCTION OF 11,507, CLASSROOMS AT BUSANDASS 2 BUSHABANI CONSTRUCTION OF 10,545, CLASSROOMS 3 KANDORO CONSTUCTION OF 3 12,541, CLASSROOMS 4 NDARABU CONSTRUCTION OF 11,750, CLASSROOMS AT KIRUGU SS 5 MATOFARINI CONSTRUCTION OF 14,555, CLASSROOMS AT KISINGIRIMA SS 6 KALAMATA CONSTRUCTION OF 15,612, CLASSROOMS Total 76,512, Water Sector Development Programme Non Implementation of Planned Activities We noted that planned activities with a total estimated costs amounting to Shs. 24,282,959,694 involving forty one (41) LGAs were not implemented as at the end of the year as detailed in Table 54 below: Table 54: WSDP activities not implemented during the year S/N Council Amount ( Shs.) 1 Ilala MC 441,000,000 2 Temeke MC 326,569,718 3 Biharamulo DC 401,544,594 4 Bukoba MC 306,054,672 5 Chato DC 76,752,043 6 Missenyi DC 524,818,307 7 Bunda DC 1,630,652,415 8 Musoma DC 1,022,585,

196 9 Rorya DC 1,597,077, Geita DC 1,548,967, Kahama 1,557,794, Kishapu DC 1, 212,898, Longido DC 499,621, Moshi DC 459,405, Iringa DC 294,379, Mufindi DC 381,334, Njombe DC 193,828, Ileje DC 591,104, Kyela DC 285,770, Mbarali DC 4,800, Mbeya DC 1,050,938, Mbozi DC 1,304,540, Mpanda TC 1,147,272, Nkasi DC 166,000, Sumbawanga MC 583,451, Lindi DC 476,420, Liwale DC 349,910, Ruangwa 376,527, Masasi DC 675,836, Mtwara DC 688,422, Mtwara MC 310,053, Nanyumbu DC 567,987, Newala DC 606,914, Tandahimba DC 697,979, Bagamoyo DC 447,831, Kibaha DC 456,317, Kabaha TC 269,441, Mkuranga DC 482,745, Rufiji DC 916,763, Kilosa DC 207,246, Morogoro MC 356,300,024 TOTAL 24,282,959, Uncompleted Projects, Shs.10,880,651,475 We noted that there were uncompleted project activities worth Shs. 10,880,651,475 as at the end of the year involving thirty (30) LGAs as reflected in Table 55 below: 184

197 Table 55: WSDP Uncompleted projects S/flectedN Council Amount (Shs.) 1 Manyoni DC 760,741,341 2 Kinondoni MC 305,459,000 3 Biharamulo DC 207,741,385 4 Bukoba DC 456,770,500 5 Karagwe DC 158,612,997 6 Tarime DC 79,280,000 7 Bukombe DC 229,975,400 8 Maswa DC 422,207,300 9 Meatu DC 299,827, Shinyanga DC 748,552, Siha DC 152,990, Muheza DC 25, 612, Kilolo DC 796,780, Mbozi DC 744,275, Rungwe DC 935,769, Mpanda DC 988,558, Mpanda TC 907,982, Kilwa DC 592,216, Lindi DC 123,000, Lindi MC 211,769, Masasi DC 265,881, Mtwara DC 379,742, Mtwara MC 213,768, Nanyumbu DC 86,288, Newala DC 68,517, Tandahimba DC 109,842, Kabaha TC 272,515, Mafia DC 151,599, Kilombero DC 162,896, Morogoro DC 47,089,444 Total 10,880,651, Store items not accounted for, Shs.28,595,049 Payments amounting to Shs. 28,595,049 were made by eight (8) LGAs for procurement of goods which were not recorded in store ledgers. Details are as reflected in Table 56 below: 185

198 Table 56: Store items not accounted S/N Council Amount ( Shs.) 1 Chamwino DC 9,135,000 2 Bukoba DC 5,072,000 3 Missenyi DC 3,566,000 4 Shinyanga DC 3,744,000 5 Shinyanga MC 4,305,000 6 Kilindi DC 667,000 7 Ileje DC 2,106,049 8 Kilosa DC 12, 331,044 Total 28,595, Procurement of goods without inviting competitive price quotations, Shs.9, 925,899 Audit noted that goods worth Shs. 9, 925,899 were procured by four (4) councils as shown in Table 57 below, from suppliers without inviting competitive price quotations contrary to Reg.28 of the PPR, 2005 and the First Schedule of the Local Government Authorities Tender Board Regulations of Table 57: Procurement without inviting price quotations S/N Council Amount ( Shs.) 1 Ukerewe DC 2,000,000 2 Babati DC 6,408,199 3 Babati TC 833,250 4 Kilindi DC 684,450 Total 9,925, Procurement of goods from unapproved supplies, Shs.21,825,815 Audit noted cases where three (3) Councils procured goods worth Shs. 21,825,815 from unapproved suppliers contrary to Reg. 40 of the PPR, Details are as reflected in Table 58 below:- 186

199 Table 58: Procurement of goods from unapproved supplies S/N Council Amount ( Shs.) 1 Kondoa DC 11,825,815 2 Shinyanga DC 6,250,000 3 Kilwa DC 3,750,000 Total 21,825, Other Projects In the course of audit of the other projects in as far as procurement is concerned, we were able to observe the following: Global Fund Table 59: Other projects with procurement irregularities 1 Health Systems Strengthening Global Fund Round 9 (HSSGFR9) Missing contract in the contract registers Contract records of which Shs. 299,026,000 was paid during the year under review concerning to health systems strengthening Global fund round 9, were not recorded in the contract register to control and justify movement of transaction from the date of commencement of the contract up to the completion. 2 National Aids Control Programme Global Fund Round 8 (NACPGFR8) Non submission of Annual Procurement Plan for NACP Global Fund. Anomalies in procurement of goods and services, Shs. 72,127,368 Unconfirmed delivery of procured goods,shs.8,784, Other Projects (Excluding Global Fund) 1 Dar Rapid Transit Agency The Agency awarded construction works and security without tender board approval and also no contract agreement was entered for the work executed of Shs. 111,027,970 2 Transport Sector Support Project (TSSP), IDA Credit No TZ and Credit No TZ Interest charged due to late payment of Interim payment certificate, Shs 19,053,

200 3 TZ-Strategic Cities Project Mwanza City council Store items not taken on ledger charges, Shs 144,371, Procurement without competitive bidding, Shs. 11,600, Mbeya city council Computer/laptop procured without specifications, Shs 42,376,700 Tanga City Council Procurement without competitive bidding, Shs.13,654,392 Mtwara Municipal Council Procurement without competitive bidding, Shs.221,495,020 4 The Tanzania Extractive Industries Transparency Initiative (TEITI) Various types of Assets purchased worth,shs.18,381,242 were not coded to identify the owner. Furthermore, TEITI did not maintain inventory card in their offices. 5 TZ-Marine & Costal Env Mgmt SIL (FY06) TZ Mainland & Zanzibar (MACEMP) Stores issued but not received and issue voucher not signed by recipient Shs.19,360,000 Furniture worth Shs.32,930,000 not supplied by the supplier not delivered despite the fact that the payment had already been effected through GEF. 6 District Agricultural Sector Investment Project The Project Coordination Unit planned to procure various goods, works and non-consultancy services as per approved budget and annual procurement plan. However, up to the time of audit (September, 2012) some of the goods, works and non-consultancy services amounting to Shs.8,690,000,000 had not been procured 8 Accelerated Food Security Project Sengereme Distric Council Input vouchers received but not recorded in the ledger, Shs. 1,755,542,000 9 The Science and Technology Higher Education Project (STHEP) The management of COSTECH purchased a new generator with 200KV from M/S INCA TANZANIA LTD costing US$ 58, The management paid the supplier before making inspection as a result the delivered generator was not automatic machine contrary to management specifications. Stores not accounted for US$ 470,

201 10 Ministry of Education and Vocational Training-Zanzibar (UNDP) Examination of payment vouchers and related records for the year under review revealed that stores and supplies purchased for the use by the Ministry amounting to Shs 20,344,960 could not be recorded in the stores ledger. Therefore, it was not possible to ascertain the propriety of the expenditure incurred which is against Reg. 198 of PFR 2001 (revised 2004) 11 National Bureau of Statistics - NBS (UNDP) Management of the project entered into an agreement with Ardhi University to enumerate areas and supervisors maps in Morogoro Region. The contract commenced on 29 th Jan,2011 scheduled to be completed on 29 th March The first progress payment of Shs. 46,851,971 was made vide cheque No The following procurement irregularities were noted: The consultancy was obtained without competitive tendering contrary to the Public Procurement Act, 2004 and its Regulations of Up to the time of writing this management letter, the work had not been completed and no measures were taken by management to ensure that the consultant completes the work. 12 The Marine and Coastal Environment Management Project Global Environmental Facility (MACEMP GEF) Contract document not distributed to the relevant authorities as required by law Non maintenance of contract register Weakness in Procurement Management, Shs.53,595, The Marine and Coastal Environmental Management Project (MACEMP IDA CREDIT NO 4106) Non maintenance of Contract Register Incompleted and irregular payment of Construction of Mvuvi House Overpayment against payment certificate/valuation certificate Shs.334,622,697 Double payment Shs.34,064,

202 6.0 Introduction CHAPTER SIX WEAKNESSES IN FINANCIAL MANAGEMENT This chapter aims at providing information on the financial performance of Donor Funded Projects for the year under audit. This includes a review of Donor Funded Projects status in regard to outstanding matters from the previous audit recommendations which were submitted to individual Accounting Officers and current key audit findings. The purpose of audit findings and recommendations issued in that regard is to assist the auditees to rectify the issues addressed therein in order to improve the financial management and control of resources of the entities. Non responding to the auditors findings and recommendations as is the case with the projects audited is a serious malpractice on the part of the Accounting Officers and management of the projects. The consequences of not acting upon the previous years auditors observations and recommendations lead to the recurrence of the anomalies observed by the auditors in subsequent financial reporting years. This can also reflect lack of seriousness and non commitment on the part of the Accounting Officers and management of the entities concerned. The list of outstanding matters from previous audit reports and other financial management weaknesses are as shown below for each of the audited projects. 6.1 AGRICULTURE SECTOR DEVELOPMENT PROGRAMME (ASDP) Implementation of the previous year s audit recommendations I acknowledge that various Councils made good progress in implementing outstanding matters arising from the previous years audits. However, in this year s audit sixty 190

203 four (64) Councils had previous years outstanding issues amounting to Shs. 9,086,703, as detailed in annexure VI Delay in transferring money from holding account to implementing partners account There are numerous delay in transferring money from the ASDP Holding account to the implementing partners account. Ideally, once the money is deposited at the holding account, it is supposed to be remitted immediately to the Council s account. However, this does not always happen Ineligible Expenditure, Shs. 1,036,474, Thirty seven (37) Councils incurred expenditure amounting to Shs. 1,036,474, which lacked relevant and sufficient information to establish their validity and therefore could not be treated as proper charge against the public funds. Six (6) Councils procured goods and services from various suppliers of which the price charged included VAT amounting to Shs.126,622, In another circumstance, twenty seven (27) Councils transferred Shs.605,135,500 from ASDP account, to other Councils accounts/ individual groups and spent Shs 299,206,506 on activities not related to ASDP. A detailed analysis of these payments is given in Table 60 below and as detailed in annexure VII: Table 60: Ineligible Expenditure Description No. of Council Amount (Shs.) Exempted VAT paid 6 126,622, Loan not recovered 4 5,509, Diversion of fund ,135, Unbudgeted expenditure ,206, Total 37 1,036,474,

204 6.1.4 Improperly Vouched Expenditure, Shs.394,055, There were payments amounting to Shs. 394,055, made without proper supporting documents. Chamwino District Council had the largest proportion (12 %) followed by Arusha DC (12.13 %) and Nachingwea DC (8.78 %). Details of Councils are in annexure VIII Missing payment vouchers, Shs.320,062,215 Payment vouchers of Shs. 320,062,215 recorded in the cash books were not produced for audit. This is contrary to Section 45 (5) of the Local Government Finances Act of There were nine (9) instances noted whereby Mbarali District Council had large proportion of missing payments vouchers (74 per cent) followed by Bunda District Council (8.73 %) and Namtumbo District Council (4 %). The accuracy and authenticity of payments made could not be ascertained and confirmed as the absence of payment vouchers limited the scope of audit contains the details Imprest not retired, Shs. 75,916,237 Imprests amounting to Shs.75,916,237 for sixteen (16) Councils(refer Annexure IX) issued during the year were not retired after completion of the intended activities. In addition, some of the officers holding outstanding imprests were issued with fresh imprests. This is a departure from Order No. 134 of the Local Authorities Financial Memorandum (1997) Funds not utilized, Shs.32,237,919, The Ministry of Finance operates a holding account for the ASDP funds where these funds are held before they are disbursed to the various implementing agents. Audit results of various projects audited during the year revealed rollover funds amounting to Shs. 32,237,919, at Council s accounts. The funds were released during the year but the responsible Councils could not spend those funds due to various reasons such as delays in release, lack of capacity to absorb the funds released and long procurement procedures for contractors to carry out earmarked activities. From our audit, we noted that various Councils had unimplemented activities pending 192

205 release of fund with associated budget of Shs.3,937,196, as detailed in annexure III.The level of unimplemented sub projects continues to have a negative impact on the Councils performance WATER SECTOR DEVELOPMENT PROGRAMME (WSDP) Status of Implementation of Previous Years Audit recommendations Assessment of implementation of audit recommendations on the issues raised in the previous audit report revealed that most of the recommendations have been implemented except for matters with a total amount of Shs.220,078,175. Details of these matters are shown in Table 61 below Table 61: Unresolved previous year matters S/N Council Amount ( Shs.) 1 Chamwino DC 4,551,500 2 Manyonj DC 38,010,450 3 Sikonge DC 14,963,580 4 Arusha DC 3,440,000 5 Arusha MC 19,933,775 6 Karatu DC 1,580,000 7 Longido DC 11,742,500 8 Monduli DC 2,370,000 9 Mwanga DC 2,599, Kibondo DC 97,091, Nachingwea DC 12,894, Mtwara MC 1,040, Mvomero DC 5,946, Morogoro DC 3,915,460 Total 220,078, Ineligible payments, Shs.353,036,793 We noted that ten LGAs under WSDP procured goods and services from various suppliers of which the price charged included VAT and other payments not related to WSDP amounting to Shs. 353,036,793. However, Section of the MoU exempted all expenditure for goods, works and 193

206 services financed using WSDP resources from all taxes imposed direct or indirectly by the Government of the United Republic of Tanzania. Table 62 below show the noted LGAs with ineligible expenditure cases Table 62: Ineligible Expenditure S/N Council Amount ( Shs.) 1 Iramba DC 202,500 2 Manyoni DC 322,488 3 Singida DC 342,000 4 Magu DC 64,477,295 5 Mwanza CC 69,208,165 6 Ukerewe DC 4,080,000 7 Korogwe DC 1,091,825 8 Kilolo DC 77,502,520 9 Mbarali DC 133,321, Sumbawanga DC 2,489,000 Total 353,036, Imprest not retired, Shs. 5,273,600 Imprests amounting to Shs. 5,273,600 for four Councils (Listed in the Table 63 below) issued during the year were not retired after completion of the intended activities contrary to Order No. 134 of the Local Authorities Financial Memorandum (1997). Table 63: Imprest not retired S/N Council Amount ( Shs.) 1 Kigoma MC 1,353,000 2 Arusha MC 911,000 3 Chunya DC 1,875,000 4 Kisarawe DC 1,134,600 Total 5,273, Improperly vouched expenditure, Shs.421, 637,516 There were payments amounting to Shs. 421,637,516 made without proper supporting documents contrary to Section 45 (5) of the Local Government Finances Act of 1982 and Order No. 8(2)(c) of the LAFM (2009). Details are in Table

207 Table 64: Improperly vouched expenditure S/N Council Amount ( Shs.) 1 Chamwino DC 1,960,000 2 Kondoa DC 6,370,000 3 Mpwapwa DC 225,000 4 Sikonge DC 68,252,810 5 Tabora DC 2,900,000 6 Kinondoni MC 8,200,000 7 Rorya DC 9,527,020 8 Ukerewe DC 14,684,000 9 Shinyanga DC 3,596, Arusha MC 43,736, Longido DC 900, Monduli DC 2,412, Babati DC 349, Babati TC 1,707, Kiteto DC 450, Korogwe DC 61,768, Chunya DC 58,443, Ileje DC 6,571, Sumbawanga DC 2,839, Namtumbo DC 27,478, Songea DC 4,385, Kibondo DC 2,830, Kilwa DC 3,135, Lindi DC 3,925, Lindi MC 630, Liwale DC 59,497, Nachingwea DC 4,525, Mvomero DC 18,218, Morogoro MC 2,119,552 Total 421,637, Under staffing in the District Councils Our review on status of human resources which is mainly an implementing factor in the Rural Water and Sanitation component noted that most of the Councils have shortage of professional and skilled staff on water sector as per council requirement. The sample covered the twenty four 195

208 (24) Councils as at 30 th June 2012 as shown in Table 65 below: Table 65: Shortage of skilled staff in Water Department Council Water Engineer Technician - FTC Technician Trade Test Required Present Required Present Required Presen t Rombo Dc Mwanga Dc Moshi MC Korogwe Dc. Muheza Dc Kiteto Dc Bukoba Dc Missenyi Dc Karagwe Dc Maswa Dc Kahama Dc Kondoa Dc Manyoni Dc Singida DC Singida Mc Kigoma Dc Kigoma/Ujij i Mc Kibondo Dc Nzega Dc Igunga Dc Tabora Mc Serengeti Rorya Dc Bunda Dc Total

209 6.3 HEALTH BASKET FUNDS (HBF) Review of the previous year s matters A review on the implementation of audit recommendations on the issues raised in the previous audit report revealed that most of the recommendations have been implemented except for matters with a total amount of Shs. 10,982,257, Details of these matters are shown in Annexure X Funds not utilised, Shs 12,405,750,901 During the year under review the LGAs had a sum of Shs. 89,217,758,099 for financing Health Basket Fund activities within the Local Authorities. However, total expenditure during the year amounted to Shs 76,812,007,208 leaving unspent balance as at the end of the year amounting to Shs. 12,405,750,901 equivalents to 13.9 % of the available funds. This situation indicates that the envisaged services were not provided to the community. A summary of Councils and amounts involved is shown in Annexure IV Missing payment vouchers, Shs. 296,087,278 During the financial year 2011/2012, expenditure amounting to Shs. 296,087,278 were not supported by their respective payment vouchers therefore, nature and validity of expenditure incurred by three (3) Councils could not be verified thereby limiting the scope of the audit contrary to Order 34(1) of LAFM, 2009 which requires the treasurer to be responsible for the safe custody of all accountable documents. The details of missing payment vouchers are shown in Table 66 below: Table 66: Missing payment vouchers Council Amount (Shs.) Kasulu DC 157,535,000 Mbarali DC 125,240,075 Mbeya CC 13,312,200 Total 296,087,

210 6.3.4 Improperly vouched expenditure, Shs. 271,064,599 Improperly vouched expenditure occurs when payment vouchers are not supported by other documentation such as Local Purchase Order, invoices, expenditure statements/justifications, Delivery notes etc contrary to the Local Authority Accounting Manual 2009 Para which requires all payments made by the Council to be properly supported, payments amounting to Shs. 271,064,599 were incurred by fourteen (14) councils without adequate documents as detailed in Table 67 below: Table 67: Improperly vouched expenditure Council Amount (Shs.) Kongwa DC 91,114,940 Ilala MC 61,876,420 Bahi DC 4,965,987 Kasulu DC. 39,304,500 Sikonge DC 13,776,140 Kibondo DC 6,840,000 Mbarali DC 11,625,000 Mbeya CC 3,878,000 Misungwi DC 3,515,000 Mwanza CC 10,387,500 Pangani DC 9,242,500 Korogwe TC 2,134,000 Babati DC 10,243,702 Nachingwea DC 7,160,910 Total 271,064,

211 6.4 TANZANIA SOCIAL ACTION FUND (TASAF) Sub Projects allocated funds but not implemented, Shs. 1,651,661, We noted a number of sub projects were not implemented even though the councils transferred funds to the respective CMC bank accounts. Some of the sub projects are listed in Table 68 below: Table 68: Sub Projects allocated funds but not implemented SN Council Activity Amount(Shs) 1 Bahi DC Construction of 31,386,190 Mphangwe earth road 9.5 km Construction of 30,351,640 Mtitaa-Mwitikila earth road 6.4 km 2 Dodoma MC Various sub projects 275,685, Masasi DC Construction of 14,487,750 Mgumchila road Construction of 14,233,400 Mkachima road 4 Rorya DC Construction of 40,057, bridge at Nyanduga Construction of 33,466, Kibuyi-Kinesi road Construction of 33,466, Nyamasanda- Nyabirongo road Construction of 35,353, Masike-Omoche road Facilitation of 6,840,100 poultry keeping for Roche widows group Construction of 41,523, Charcodam at Ryagoro Construction of 34,062, Mang ore road 199

212 Completion of 21,700,091 Nyasoro dispensary project 5 Mpanda DC Additional funds for completion of Administration Block at Kashaulili Secondary School 28,674,000/- 6 Mvomero Rehabilitation of 1,000,000 Tomato factory at Kipera 7 Kilosa Irrigation schemes at Chabima 18,533,600. Production of 12,606, Assisting tools for disabled/ but not they changed into milling machine 8 Tandahimba Various sub projects 173,171,546 9 Ulanga Purchase of milling machine for widows 4,627,436 Purchase of 4,776,911 carpentry machine for unemployed youth Purchase of milling 5,068,403 machine for widows Purchase of milling 5,067,895 machine for elderly 10 Mpwapwa Various 295,982, Kongwa DC Various 45,056, Morogoro Uluguru secondry 17,991,727 MC school 13 Tandahimba Various 173,171,546 DC Total 1,651,661,

213 6.4.2 Completed buildings not in use, Shs 69,630, Physical verification was made on completed subprojects in Chamwino District Council and we observed that 4 sub projects were not in use despite being completed. Specific sub projects are the following: Dispensary at Ndogowe village Four classrooms at Mvumi makulu Secondary school Maternity ward at Mpwayungu dispensary Four classrooms at Msanga Secondary school Councils contribution in arrears accumulated to Shs.23,000,000 Review of the Council s Budget noted that, Sengerema District Council was required to contribute an amount of Shs.12,000,000 each year to support Tanzania Social Action Fund activities in the District. However, review made on budget for three consecutive years disclosed that the Council has not contributed a sum of Shs.23, 000, Unrefunded TASAF project funds transferred to General Fund, Shs. 101,500,000. The Council issued an advance amounting to Shs.101,500,000 to account No 1 (General Fund) of Chuya DC. During our audit, we noted that the advance had not been refunded. This hinders the implementation of the approved sub projects at the same magnitude Funds received but not transferred to CMCs for implementation of planned TASAF projects Shs. 77,449, Examination on the funds received by the councils and transferred to the respective CMCs for implementation of sub projects which were approved by TMU revealed that a sum of Shs. 77,449, was not transferred and therefore the sub projects were not implemented as planned as shown in Table 69 below: 201

214 Table 69: Untransferred funds Council Sub project Amount(Shs) Musoma Construction of Kuruya 37,986,500 MC Mbatano road Poultry keeping at Omuga 8,323,507 village Kilosa Irrigation schemes at Chabima DC 18,533,600. Production of assisting tools for 12,606, disabled/ but instead it was changed into milling machine Total 77,449, Outstanding imprest, Shs.20,000,000 Special imprests amounting to Shs. 20,000,000 was issued to Samwel A. Nkomola the imprest was neither recorded in the imprest register nor retirement particulars availed for audit verification; this is contrary to Order No. 40 (3) of Local Authority Financial Memorandum, Expenditure charged to wrong expenditure codes, Shs. 14,262, Expenditure amounting to Shs. 14,262, was noted to have been charged to wrong expenditure code details as shown in Table 70 below: Table 70: Expenditure charged to wrong expenditure codes Council Activity Amount(Shs) Findings 1 Construction of bore hole for dispensary-gulika kwalala 7,595, Code Charged is for laboratory infrastructure instead of bricks and cement 202

215 2 Undule Tanzania Supplies 222, Office consumables code charged to purchase car battery Magu Various 6, 445,000 charged to the wrong accounting codes Total 14,262, Improperly payments, Shs. 153,344, Based on sampled payment vouchers, we noted payments amounting to Shs. 153,344, missing supporting documents this is contrary to Order No. 10(2) (d) of LAFM 2009 which requires all expenditure to be supported by relevant documents. The accuracy and authenticity of payments made could not be ascertained and confirmed due to the absence of supportig documents.the details of improperly payments are as shown in Table 71 below: Table 71: Missing supporting documents SN Council Amount(Shs) 1 Ukerewe 12,141,757 2 Bunda 3,917,500 3 Rorya 1,731,000 4 Musoma 1,922, Kahama 1,921,350 6 Meatu 86,770, Mbulu 4,003,500 8 Arusha MC 6,084,922 9 Kibaha 4,880, Bahi 9,525, Kigoma MC 3,166, Monduli 680, Magu 12,950, Tandahimba 3,650,000 Total 153,344,

216 Missing payment vouchers, Shs. 71,010, Payment vouchers amounting to Shs.71,010, were not produced for audit. This is contrary to Order No. 104(2) of LAFM 2009 which requires payment vouchers together with their supporting documents to be maintained and given proper security and custody for a period not less than 5 years. The accuracy and authenticity of payments made could not be ascertained and confirmed as the absence of payment vouchers limited scope of audit. The details of unaudited vouchers are as shown in Table 72 below: Table 72: Missing payment vouchers SN Council Amount(Shs) 1 Kishapu 1,650,000 2 Kiteto 22,770, Arusha 30,905,515 4 Kilwa 5,791,000 5 Kwimba 9,893,270 Total 71,010, GLOBAL FUND AND OTHER PROJECTS (i) The Science and Technology Higher Education-Project (STHEP) Dar-es-salaam Institute of Technology (a) Six bank accounts operating under the World Bank Project During the audit of the accounts and other related documents we noted that the college operates six accounts under the World Bank project. The following were the accounts maintained at African Banking Cooperation and the closing balances as at 30 th June, 2012 were confirmed by the bank is shown in Table 73 below. 204

217 Table 73: Confirmation of Bank balances Account no Type of account Currency Balance amount (Shs) Current USD DR Current USD 605, CR Current USD 5, CR Current USD 2, CR Current USD 2, CR Current USD 8, CR Total 625, However, contrary to the Finance Act and regulations requirements, the bank reconciliation of each account was not submitted to auditors when requested for audit purposes. (b) Ineligible expenditure, USD 16, During the current year s audit, we noted that a total of USD 16, was paid to various individuals to cater for outfit allowance, cleaning material, and seminar costs, these expenses were not part of the allowable expenses as per project implementation plan arrangement Para 9.1 and 9.5 as detailed in Table 74 below: Table 74: Inelligible expenditure S/No. Institution Amount US $ 1 MOEVT 2, MUCE 14, Total 16, (c) Unretired imprest, USD 159, A test check on payment vouchers and other related records revealed that the following institutions made payments amounting to USD 159, as safari imprest to various staff for various purposes. However, the amount was not retired as at the time of audit December,

218 Table 75: Unretired imprests S/No. Institution Amount USD 1. UDSM 121, OUT SUA 25, MUCE 12, Total 159, (d) Unsupported expenditure, USD 154, A test check of the year s payment vouchers and other related records revealed that the project management made several payments totaling USD154, However, contrary to the programme appraisal and project implementation plan documents, the payments were inadequately supported to justify the expenditure as per detailed in Table 77 below: Table 76: Unsupported expenditure S/No. Institution Amount USD 1. MOEVT 59, UDSM 25, COSTECH 30, OUT 3, MUCE 35, Total 154, The District Health Infrastructure Rehabilitation PMO - RALG COMPONENT (a) Missing supporting documents, Shs. 43,807,500 Audit scrutiny noted that, Shs.43,807,500 was paid to National Construction Council (through the Manager NMB Dodoma) as consultation fees. However, the following anomalies were revealed: The expenditure was not budgeted for. The invoice to support the payment was missing. The amount was paid to settle the creditor from the previous year; however, the payee was not in the list of previous year`s creditors. Acknowledgement receipt was missing. 206

219 Contract agreement was missing Road Sector Support Project (RSSP) (a)non accountability of compensation money, Shs.318, 065,400 Review of accounts and related transactions noted that, sum of Shs. 2,183,472, was transferred to the office of Regional Managers for Iringa and Ruvuma Regions for the purposes of paying compensation to land and property owners to pave way to allow roads construction of Iringa to Dodoma and Namtumbo to Tunduru. Out of that amount Shs.1, 865,407,161 was spent, living a balance of Shs.318, 065,400. A detailed analysis of amount received and expended by Regional Managers is as shown in Table 77 below: Table 77: Regional Manager Dodoma Receipt No. Date Amount (Shs) /07/ ,172, /07/ ,130,500 Total amount received 580,302,900 Less: Expenditure (compensations) 414,097,400 Balance 168,205,500 No clear explanation was given regarding the unspent balance of Shs. 168,205,500/= Table 78: Regional Manager Ruvuma Receipt No. Date Amount (Shs) /01/ ,172, /06/ ,130, /09/ ,070, /09/ ,105,438 Total Amount received 1,037,027,295 Less: Expenditure (compensations) 1,019,941,480 Balance 17,085,815 The remained balance was due to death of the claimers, non appearance and alternative direction of the road after re-surveying. 207

220 Table 79: Regional Manager Iringa Receipt No. Date Amount (Shs) /07/ ,761, /07/ ,380, Total amount received 566,142, Less: Expenditure 431,368, (compensations) Balance 134,774, It was said that the unpaid balance was as a results of resurveying of the road hence the change of design. New claims from land property owners are being lodge.d Teaching and Learning Science, Mathematics and English in Government Secondary Schools using ICT (a) Ineligible expenditure, Shs.30,798,320 A total of Shs.30,798,320 was paid to cater for launching cost of a project on Teaching and Learning Science, Mathematics and English in Secondary school by using ICT. The launching of the project took place from 26/09/2011 to 27/09/2011. However, according to contract agreements; the cost of launching was not to be borne by the project as stipulated in Articles 4 and 5 of the contract agreements. (b) Non implementation of the ICT program at Klerruu Secondary School A test check in respect of program implementation was conducted at Klerruu Secondary School. It was noted that trained teachers for Science, Mathematics and English had not started using the ICT facilities provided in their classes. In addition, the laptop computers issued to teachers were left at home East Africa Public Health Laboratory Networking Project (a)ineligible expenditure, Shs. 72,022,500 The project management paid total sum of Shs. 72,022,500 as sitting allowance, honoraria allowance, internal and consulting service to the Civil /public servant for attending 208

221 workshop, project steering committee meeting. The payment was contrary to the World Bank directives of July 5, 2011 on rationalization of allowance practices in IDA financed project which restricted payments of honorarium/sitting allowance and internal consulting services Lake Victoria Environment Management Project (Ii) (a)uncompleted Projects, Shs.109,206,137 During the year 2010/2012, the Lake Victoria Environment Management Program issued funds targeted to various projects under the Lake Victoria Environment Management Project. However projects worth Shs.109,206,137 were not completed as planned as observed during site visits conducted on 27 th November, The Small Enterpreneus Loan Facility (SELF) Project (a) Non recovery of long outstanding loans, Shs.867,888,610 Review on outstanding receivables amounting to Shs. 867,888,610 made up of principal Shs. 810,804,610 and interest Shs.57,084,000 aging from thirty days to seven years as at the date of this management letter. In addition, the project did not send out reminder notices at least monthly to debtors contrary Regulation 2.4 of Self Credit Operation Manual of The Marine and Coastal Environmental Management Project - Global Environmental Facility (a) Ineligible expenditure, Shs.124,776,801. Sum of Shs.444,749, was paid to various dealers alleged to supply office furniture and equipment, construction works and photocopier machine to MACEMP. Shs.124,776,801 out of the paid amount above was in respect of Value Added Tax. However, according to Development Credit Agreement Section 5.08, the Donor funds project is exempted from Tax and therefore paid is ineligible expenditure Tanzania Forest Fund- TFS (UNDP) (a) Imprests not yet retired Shs 11,641,

222 Imprest issued to staff amounting to Shs 11,641,400 was yet to be retired as at the closure of the accounting period contrary to of Reg. 103 (1) of PFA The Prime Minister s Office Regional Administration and Local Government - PMO RALG (UNDP) Amount of funds received from UNICEF Shs. 71,630,000 was not used to implement the agreed activities Tanzania Food and Drugs Authority (UNDP) (a) Unsupported payment Shs. 33,814,037 TFDA paid a total of Shs. 33,814,037 to facilitate various activities.however, the relevant supporting documents were not attached to their respective payment vouchers contrary to Reg. 95(1) of Public Finance Regulations 2001 (Revised 2004). 210

223 7.1 Conclusion CHAPTER SEVEN CONCLUSION AND RECOMMENDATIONS The detailed audit findings of the individual management letters and reports which are summarized in this General Report were communicated to the respective Accounting Officers for their necessary action. The Accounting Officers who are responsible for implementation of the Donor Funded Projects are required to prepare structured responses on the CAG s audit findings and recommendations and submit them to the Paymaster General. In this report, I have pointed out several weaknesses in internal control systems in accordance with Reg of the Public Finance Regulations, 2001(revised in 2004) which resulted from the audit conducted. These matters call for immediate intervention from the Accounting Officers by establishing sound internal control systems that will effectively address the weaknesses pointed out in this report as summarized below, and in compliance with Sect.12 of the PAA No.11 of I have made several recommendations as listed below which, if implemented, will enhance sound financial management of the Donor Funded Projects within the Government. The scope of audits of the Internal Audit Units in MDAs and LGAs is left much to be desired. Important areas namely audit of financial statements and operations of Donor Funded Projects particularly on accountability and performance evaluation of projects in line with the MoU requirements were not adequately covered during the audit. Since most development projects are done in the lowest administrative levels of government that is Villages Accounting Officers of most LGAs have no time to 211

224 attend to these projects including providing adequate supervision. Accounting Officers are not very keen to address and implement audit recommendations.this is evident by the fact that as of the date of this report there are previous recommendations which remained unattended amounting to Shs.20,289,040,011. This report has shown HBF had outstanding matters amounting to Shs. 10,982,257,870, followed by ASDP with Shs. 9,086,703, 966 and finally WSDP with Shs. 220,078,175. There has been unhealthy delays in release of funds from Development Partners and Treasury to project implementing partners. This has contributed in delays or non implementation of earmarked projects and also resulting in huge amounts of unspent balances amounting to Shs. 299,852,509,319, and USD 213,520,573 as at 30 th June, There were cases of Ineligible expenditure amounting to Shs.1,617,109,102 in total of which Shs. 1,036,474,688 was incurred in ASDP, Shs. 353,036,793 was incurred in WSDP and Shs. 227,597,621 were incurred in other projects. This implies that Accounting Officers had spent project funds for unintended purposes. We noted serious internal control weaknesses in the overall financial management of projects whereby during the financial year 2011/2012, there was improperly vouched expenditure amounting to Shs. 1,264,915,933 incurred by nine (9) Councils contrary to Order 34(1) of LAFM, 2009 and Local Authority Accounting Manual 2009 Para Also, there were missing payment vouchers amounting to Shs.730,967,490. ASDP had missing payment vouchers amounting to Shs. 320,062,215 followed by HBF with an amount of Shs. 296,087,278, TASAF with Shs. 71,010,

225 and finally Shs. 43,807,500 from other donor funded projects contrary to Order 34(1) of Local Authority Financial Memorandum, Accounting Officers of Sixteen (16) Councils had violated requirements of Reg. No.68 (5) of the Public Procurement (Goods, works, non consultant services and disposal of public assets by tender Regulations of 2005 together with Order No.272 of Local Authority Financial Memorandum (LAFM) of 1997 and MoUs by effecting procurement of goods and services aggregating to Shs. 291,928,527 from suppliers not approved by Councils Tender Boards. Payments amounting to Shs. 305,125,078 were made in advance to various suppliers using DFP funds during the year under review. However, the goods had not been delivered at the audit date, contrary to Order No. 71(1) (b) of the LGFM, Medical items worth Shs. 412,219,600 were procured by nine (9) Councils, from private suppliers and without MSD approval contrary to Sect.4 of the Local Authorities Tender Boards (establishment and proceedings) Regulations, Lastly In my previous year s General Report, I pointed out that the audit of the four major donor funded projects namely, TASAF, WSDP, HBF and ASDP was a challenging task to my Office due to the fact that there has been inadequate staff and lack of adequate financial resources. In this year s audit, my Office had encountered similar scenario. In this regard, therefore, it is very likely that the audit of the above projects will be outsourced to private audit firms to do the audit on my behalf; however it will still remain my responsibility to issue the audit report 213

226 7.2 Recommendations The Internal Audit Units in MDAs and LGAs should be more involved in the audit of the Donor Funded Projects by ensuring adequate coverage of critical areas namely audit of the quarterly performance reports of projects being implemented, proper documentations and records and compliance to the requirements of the MOUs. The Internal Audit should strive to work towards effecting a major improvement on the financial management of the public sector including the handling of Donor Funded projects. The Ministry of Finance through the Internal Audit Department should be strengthened and have the ability to impose strict financial controls on Accounting Officers and improve accounting of Government expenditures including Donor Funded projects. In addition the Ministry has to ensure that all Accounting Officers prepare financial statements and submit them for audit on time.there is need for the Ministry to introduce sanctions to Accountig Officers who will fail to perform to the acceptable standards and benchmarks. Development Partners, the Ministry of Finance (Treasury) and PMO RALG should ensure timely release of funds earmarked for implementation of project activities to avoid delays in completion of projects and projects remaining with excessive unspent funds at the year end. Accounting Officers responsible for the management of these Donor Funded Projects should put more efforts to ensure that recommendations pertaining to previous year s audit are attended to accordingly so as to eliminate the possibility of the recurring of the same issues in future. Accounting Officers should ensure that there is cost benefit and value for monies spent during the planning, design and implementation of projects. Accounting Officers should ensure that procurement of works, goods and services comply with the requirements 214

227 of the Public Procurement Act of 2004 together with its Regulations of 2005 together with Order No.272 of Local Authority Financial Memorandum (LAFM) of 1997 and MoUs in order to avoid unnecessary procurements. Development Partners are requested to consider budget provision for audit fees for all audits of the major four Donor Funded Projects due to the experienced inconsistencies in the release of funds from Treasury for the audit of the DFP. All stakeholders should be involved in the preparation of Donor Funded Projects MoUs before the same are signed by the Government and the Development Partners to avoid complications in the subsequent implementation of such MoUs. From the audits conducted, according to our findings, projects and programmes that are locally owned by those who implement them have proved to be more likely to succeed and be sustainable. This observation is very valid and warrant that high priority be given to enhancing local ownership of development policy and programmes.tasaf is very good example of a project owned by local communities and is doing well relatively. PMO RALG should effectively supervise the implementing LGAs and ensure that they implement the various projects in accordance with the agreed MOU. For example the preparation of financial statements and audit is a basic requirement. The Government should reassess staff manning levels in the LGAs as it is evident that there is an acute shortage of staff with prerequisite qualifications in running the operations of the LGAs including the management of the Donor Funded Projects. 215

228 ANNEXTURES Water Sector Development Programme (WSDP) - Financial Perfomance Annexure I Opening balance Expenditure S/No Council (Shs.) Received (Shs.) Available (Shs.) (Shs.) Balance (Shs.) 1 Bahi DC 198,167, ,860, ,027,958 34,577, ,449,979 2 Chamwino DC 210,593, ,282, ,875, ,382, ,492,622 3 Dodoma MC 55,653, ,578, ,232,337 72,303, ,928,574 4 Kondoa DC 264,208, ,837, ,046, ,954, ,091,392 5 Kongwa DC 237,977, ,082, ,059,338 69,665, ,394,122 6 Mpwapwa DC 334,613, ,325, ,939,187 95,162, ,776,627 7 Kasulu DC 83,214, ,002, ,217,803 80,700, ,516,854 8 Kigoma DC 644,816, ,308, ,124, ,558, ,566,027 9 Kigoma MC 388,137,622 25,648, ,785, ,530,096 64,255, Iramba DC 894,376, ,700,500 1,344,076,500 36,325,530 1,307,750, Manyoni DC 784,781, ,506,686 1,279,288, ,421,098 1,104,866, Singida DC 276,911,776 1,611,213,000 1,888,124, ,963,164 1,754,161, Singida MC 77,207, ,771, ,979, ,974,123 5, Igunga DC 366,675,215 93,943, ,618, ,576, ,041, Nzega DC 392,914, ,162,000 1,143,076, ,453, ,623,

229 16 Sikonge DC 228,140, ,123, ,264, ,879, ,384, Tabora DC 209,645, ,768, ,413, ,764, ,648, Tabora MC 149,718, ,669, ,388, ,228, ,159, Urambo DC 443,595,440 87,903, ,499,393 3,909, ,589, Ilala MC 246,631,645 31,784, ,415, ,518,264 88,897, Kinondoni MC 425,235, ,235, ,136, ,098, Temeke MC 320,938, ,648, ,586,380 51,341, ,245, Biharamulo DC 287,497, ,958, ,455, ,911, ,544, Bukoba DC 89,383, ,452, ,835, ,808, ,027, Bukoba MC 211,443, ,726, ,169,771 84,115, ,054, Chato DC 293,293,612 5,648, ,941, ,092,922 99,848, Karagwe DC 286,318, ,130, ,448,453 28,115, ,333, Missenyi DC 6,769, ,083, ,852,417 11,951, ,901, Muleba DC 253,425, ,021,959 1,234,447, ,539,850 1,079,908, Ngara DC 193,083, ,810, ,893, ,131, ,761, Bunda DC 219,466, ,914, ,380, ,903, ,476, Musoma DC 321,056, ,976, ,033, ,307, ,726, Rorya DC 483,077, ,648, ,725, ,889, ,835, Serengeti DC 15,287, ,550, ,838, ,600, ,238, Tarime DC 481,638,229 5,648, ,286, ,825, ,460,

230 36 Geita DC 34,962, ,648, ,610,383 40,508, , Kwimba DC 239,717, ,398, ,115, ,959, ,156, Magu DC 218,847, ,582, ,430, ,287, ,143, Missungwi DC 422,746, ,746, ,781, ,964, Mwanza CC 303,500, ,774, ,275, ,933, ,342, Sengerema DC 396,543, ,079, ,623, ,726, ,896, Ukerewe DC 269,941, ,971, ,913, ,424, ,489, Bariadi DC 498,493,574 11,018, ,511, ,405, ,105, Bukombe DC 170,769,359 1,535,919,000 1,706,688,359 87,119,163 1,619,569, Kahama DC 196,048,522 1,973,739,667 2,169,788, ,113,408 1,666,674, Kishapu DC 214,720,369 1,145,069,857 1,359,790, ,748,735 1,152,041, Maswa DC 548, ,221, ,770, ,708, ,061, Meatu DC 289,738, ,304, ,042, ,609, ,432, Shinyanga DC 160,341, ,584, ,925, ,308, ,617, Shinyanga MC 195,042, ,642, ,684,346 21,180, ,503, Arusha DC 463,584, ,648, ,232, ,999, ,233, Arusha MC 292,768, ,448, ,216, ,570, ,646, Karatu DC 154,139, ,139, ,981, ,158, Longido DC 9,047, ,648, ,695,032 13,412, ,283, Meru DC 150,263, ,418, ,681, ,323, ,358,

231 56 Monduli DC 272,611, ,805, ,417,613 10,071, ,346, Ngorongoro DC 388,020, ,146, ,166, ,020, ,146, Hai DC 953,714, ,404,500 1,094,119,096 1,597,000 1,092,522, Moshi MC 242,851, ,648, ,499,956 14,159, ,340, Mwanga DC 389,446, ,435, ,882, ,333, ,548, Rombo DC 417,213, ,648, ,861,355 4,842, ,018, Same DC 440,036, ,295, ,331, ,903, ,427, Siha DC 275,980, ,823, ,804, ,955, ,848, Moshi DC 465,114,995 5,648, ,762,995 11,357, ,405, Babati DC 925,294, ,572, ,813,866,722 1,148,602, ,264, Babati TC 470,762, ,510, ,273, ,044, ,228, Hanang DC -10,009, ,648, ,361, , ,886, Kiteto DC 216, ,638, ,854, ,055, ,798, Mbulu DC 316,534, ,130,000 1,221,664,000 60,780,462 1,160,883, Simanjiro DC 149,466, ,648, ,114,604 16,747, ,367, Handeni DC 237,921, ,462, ,384,033 3,085, ,298, Kilindi DC 196,229, ,724, ,953,966 48,575, ,378, Korogwe DC 329,258, ,822, ,080, ,413, ,667, Korogwe TC 130,021, ,327, ,348, ,436, ,911, Lushoto DC 376,944,177 1,219,422,000 1,596,366, ,834,372 1,401,531,

232 76 Mkinga DC 301,650, ,528, ,178,598 7,819, ,358, Muheza DC 297,643, ,413, ,057, ,449, ,607, Pangani DC 331,549, ,003, ,552,507 47,840, ,711, Tanga CC 487,094,155 28,573, ,667, ,620, ,046, Iringa DC 34,144, ,005, ,149,170 47,033, ,116, Iringa MC 304,357, ,672, ,029, ,395, ,633, Kilolo DC 148,383, ,905, ,288, ,026, ,261, Ludewa DC 178,149, ,258, ,407, ,089,981 68,317, Makete DC 328,439, ,969, ,408,730 53,974, ,434, Mufindi DC 138,605, ,717, ,322, ,356, ,965, Njombe DC 205,645, ,456, ,102,229 44,146, ,955, Njombe TC 101,588, ,412, ,000,472 95,239, ,761, Chunya DC 152,647, ,738, ,385, ,620,283 57,764, Ileje DC 152,059, ,381, ,440,097 21,531, ,909, Kyela DC 73,737, ,984, ,721,877 57,297, ,424, Mbarali DC 46, ,648, ,694, ,940,588 19,753, Mbeya CC 381,203, ,545, ,749, ,294, ,454, Mbeya DC 168,871, ,274,000 1,072,145,787 10,887,283 1,061,258, Mbozi DC 288,569,453 1,649,502,407 1,938,071, ,026,495 1,491,045, Rungwe DC 255,395,694 1,157,042,230 1,412,437, ,747,469 1,044,690,

233 96 Mpanda DC 3,964,780 1,480,141,907 1,484,106,687 41,853,700 1,442,252, Mpanda TC 266,930, ,869, ,799,442 46,175, ,624, Nkasi DC 308,759, ,374, ,134, ,665, ,468, Sumbawanga DC 417,065, ,592, ,658, ,794, ,864,286 Sumbawanga 257,368, ,526, MC 97,738, ,629,129 68,841, Mbinga DC 409,990, ,429,000 1,052,419,989 85,094, ,325, Namtumbo DC 240,232, ,971, ,204, ,901, ,303, Songea DC 165,358, ,848, ,206,714 82,421, ,785, Songea MC 169,928, ,594, ,522,917 25,216, ,306, Tunduru DC 306,299, ,689, ,989, ,076, ,912, Kibondo DC 224,754, ,610, ,365, ,673, ,692, Kilwa DC 454,904, ,080, ,411,985, ,042, ,014,942, Lindi DC 417,417, ,206, ,623, ,768, ,854, Lindi MC 242,920, ,393, ,314,119 97,070, ,243, Liwale DC 334,823, ,238, ,061, ,293, ,768, Ruangwa 375,329, ,262, ,591,751 95,506, ,085, Nachingwea DC 348,488, ,981, ,165,469,348 30,324, ,135,144, Masasi DC 72,615, ,075,551,598 1,148,166, ,448, ,718, Mtwara DC 440,655, ,386, ,134,041,720 65,886, ,068,155,

234 115 Mtwara MC 334,409, ,701, ,110, ,385, ,725, Nanyumbu DC 237,288, ,251, ,539, ,455, ,083, Newala DC 300,874, ,914, ,788, ,356, ,431, Tandahimba DC 267,921, ,979, ,901, ,079, ,821, Bagamoyo DC 211,324, ,734, ,058, ,683, ,375, Kibaha DC 212,394, ,162, ,556, ,424, ,132, Kabaha TC 334,397, ,587, ,984,772 74,028, ,956, Kisarawe DC 314,894,955 7,647, ,542, ,851, ,691, Mafia DC 385,890,998 7,049, ,940, ,340, ,599, Mkuranga DC 476,229,613 19,628, ,857,613 13,112, ,745, Rufiji DC 622,737, ,134,620 1,231,872, ,034,058 1,035,838, Kilombero DC 374,712,975 5,648, ,360, ,934, ,426, Kilosa DC 231,376,577 1,675,015,232 1,906,391,809 1,699,145, ,246, Mvomero DC 138,752,122 35,648, ,400, ,498, ,098, Morogoro DC 493,467,112 5,648, ,115,112 11,391, ,724, Morogoro MC 334,129,113 10,284, ,413, ,491,355 44,921, Ulanga DC 340,089, ,471, ,561, ,460, ,101,383 Total 37,264,145,703 51,038,944,925 88,303,090,630 23,747,035,595 64,556,055,

235 TASAF - Financial Performance Opening S/N Council balance (Shs.) Received (Shs.) Available (Shs.) Expenditure (Shs.) Annexure II Balance (Shs.) 1 Iramba DC 31,920, ,339, ,260, ,491,294 34,768,977 2 Kigoma DC 20,436, ,924, ,360, ,256,014 2,104,729 3 Manyoni DC 18,379, ,464, ,844, ,464,379 60,380,471 4 Bahi DC 21,840, ,342, ,182, ,639, ,543,366 5 Dodoma MC 18,169, ,782, ,952, ,190, ,761,401 6 Kasulu DC 76,867, ,821, ,688, ,930,902 5,758,066 7 Nzega DC 21,842, ,089, ,931, ,687,521 16,244,188 8 Urambo DC 2,972,747 81,131,896 84,104,643 80,612,373 3,492,270 9 Kibondo DC 249,690, ,877, ,568, ,525,017 43,218 Kigoma/Ujiji 146,100, ,150, MC 22,604, ,704,463 2,554, Tabora MC 2,354,428 2,256,829 4,611,257 4,343, , Chamwino DC 61,075, ,834, ,909, ,815,077 67,094,610 Igunga DC 676,328, ,682,

236 13 76,354, ,682, Kondoa DC 237,507, ,638, ,145, ,619, ,526, Sikonge DC 6,835, ,058, ,894, ,299,126 4,595, Bunda DC 23,608, ,267, ,875, ,420,681 3,454, Musoma MC 337, ,829, ,167, ,738, , Serengeti DC 8,611,387 88,056,560 96,667,947 96,462, , ,247, ,650, Musoma DC 29,479, ,727,417 15,076, ,895, ,975, Rorya DC - 501,895,224 47,919, ,661, ,702, Tarime DC 1,175, ,836,846 2,134, ,346, ,015, Geita DC 9,650, ,996,570 16,980, ,826, ,156, Misungwi DC 89,623, ,450, ,293, ,319, ,993, Mwanza CC 95,903, ,222,426 30,228,885 63,238, Karagwe DC 6,566,604 56,720,574 63,287,178 49,030 2,096,550 25,160, Bukombe DC 23,390,242 25,486, , ,256, ,220, Shinyanga DC 94,390, ,647,185 27,426, ,807, ,803, Kishapu DC 77,214, ,021,744 11,217,

237 464,416, Meatu DC 10,670, ,086, ,012, Kahama DC 45,131, ,144, Bariadi DC 14,150,586 32,450,711 46,601, ,818, Maswa DC 194,339, ,157, ,461, Arusha DC 96,551, ,012, ,069, ,419,470 46,258, ,122, ,946, ,017, , , ,035,489 68,066, Babati DC 15,524, ,358, ,882, ,191,493 31,691, ,004,745 55,409, Babati TC 1,849, ,854,300 77,445, ,540, ,745, Hai DC 1,537, ,078, , ,400, ,615, Hanang' DC 13,438, ,839, ,224, ,254, ,138, Handeni DC 66,088, ,343,208 6,204,293 58,161, Karatu DC 4,240,893 70,718,385 74,959,278 16,797, ,300, ,631, Kilindi DC 67,173, ,473, ,841, ,378, ,725, Kiketo DC 114,043, ,421, ,695, Korogwe DC 115,181, ,412, ,593, ,769,657 57,823,764 22,896 2,700, Korogwe TC 2,742,730 2,765,626 64,656 Longido DC 786,921, ,242,

238 44 166,213, ,134, ,892,004 8,980,373 14,799, Moshi MC 9,031,864 18,012,237 3,213, ,639, ,301, Mbulu DC 57,457, ,096,732 27,795, Meru DC 9,882,219 18,603,508 28,485,727 27,630, , Mkinga DC 201,451,548 91,823, ,274, ,979,890 19,294, Monduli 140,978, ,555, ,533, ,868,717 92,664, Moshi DC 37,744, ,958, ,702, ,914,699 88,787, ,550, ,598, Muheza DC 231,392, ,942,448 7,343, ,945, ,974, Mwanga DC 14,581, ,527,058 40,552, Ngorongoro 337,985, ,425,882 DC 34,869, ,854,838 15,428, ,669, ,240, Pangani DC 93,843, ,512,967 4,272, Rombo DC 44,344, ,994, ,338, ,889,389 91,448, ,536, ,089, Siha DC 9,692, ,228,867 20,139, ,426, ,078, Same DC 78,744, ,171,758 19,093, ,271, ,370, Simanjiro DC 40,100, ,371, ,001,427 85,238, Tanga CC 2,157,299 83,320,410 85,477, ,

239 60 Arusha MC 3,200, ,359, ,560, Temeke DC 23,254,148 17,479,692 40,733, Kwimba DC 14,932, ,575, ,508, Ngara DC 42,448,128 81,408, ,856,983 Sengerema 64 DC 98,501,189 72,136, ,638, ,367, Kilwa DC 97,267, ,634,738 1,020,122, Ruangwa DC 131,159,570 1,151,282, ,960, Lindi DC 136,257, ,218, ,829, Lindi MC 18,622, ,451, ,303, Liwale DC 32,990, ,293,592 Nachingwea 70 DC 46,988,209 53,868, ,856, ,860,921 36,858, ,241, ,278, ,812, ,998,856 1,024,943, ,653, ,538, ,879,606 79,186,741 30,699,112 3,874,863 20,267, ,215 2,826, ,635, ,338, ,564, ,912, ,413,987 21,670, Shinyanga MC 132,641, ,863, ,504, ,511,978 7,992, Bukoba DC 49,966, ,880, ,846, ,375, , ,200, ,704, Bukoba MC 5,924, ,124, , Muleba DC 24,964, ,639, ,603, ,601,614 2,319 Masasi DC 639,079, ,999,

240 75 40,413, ,492,788 39,493, Mtwara MC 33,120, ,825, ,945, ,866,914 78,999 20, Newala DC 5,000 20,041,673 20,046,673 20,026, ,273, ,409, Mtwara DC 49,203, ,476,527 20,067,391 Nanyumbu 105,457, ,861, DC 116,211, ,669,168 47,807, Iringa MC 12,809, ,153, ,963,062 48,824, ,138,594 54,617, Mbeya CC 24,321,273 35,000,000 59,321,273 4,703,410 7,000,000 7,077, Mbinga DC 145,798 7,145,798 68, Mpanda DC 92,236,647 57,060, ,296, ,985,860 2,310, Mpanda TC 81,695,221 43,580, ,275, ,071, ,712 Namtumbo 43,192, DC 16,817,656 26,465,000 43,282,656 90, ,386, ,214, Njombe DC 110,646, ,033,792 13,819,433 44,740, Nkansi DC 5,500,277 39,380,991 44,881, ,933 Sumbawanga 3,985,405 70,607, MC 82,485,356 86,470,761 15,863,623 32,525, Songea MC 1,696,663 30,869,935 32,566,598 41, ,714, ,823, Iringa DC 176, ,890,369 66,

241 135,014, ,195, Chunya DC 83,045, ,059,485 51,864,279 Sumbawanga 84,447, DC 4,723,601 80,107,955 84,831, , ,273, ,919, Kilolo DC 33,428, ,701, ,797 18,951, Ludewa DC 1,943,071 17,072,905 19,015,976 64,503 95,608, Makete DC 7,725,249 88,027,539 95,752, , ,031, Mbeya DC 64,003, ,035, ,829,548 26,205, Mufindi DC - 17,122,315 17,122,315 13,687,666 3,434, ,433, Songea DC 3,331, ,791, ,123, ,986 50,644, Rungwe DC 20,405,573 30,767,495 51,173, , Kibaha TC 283, , , ,446, ,706, Kisarawe DC 903, ,349,248 68,642, ,352, ,800, Rufiji DC 10,479, ,831,854 31, ,087, ,523, Bagamoyo DC 78,925, ,013,068 35,489, ,887, ,550, Kibaha DC 22,564, ,452,059 4,901, Mafia DC 44,620, ,345, ,965, ,340,638 40,624,946 Mkuranga DC 118,727,

242 106 30,322,334 90,636, ,959,163 2,231,827 22,894, Chato DC 11,250,382 12,082,840 23,333, , ,114, ,796, Misenyi DC 5,383, ,498,342 4,701,931 Biharamulo 9,001,227 21,025, DC 12,146,645 21,147, , ,637, ,438, Mvomero DC 33,277, ,915, , ,586, ,586, Ilala DC 180, ,767, , Ukerewe DC 71,757, ,052, ,810, ,930,920 40,879, ,568, ,192, Lushoto DC 183,169, ,737, ,545, ,135, ,752, Kilosa DC 223,742, ,878,206 35,125,668 88,956, Kilombero DC 15,105,736 76,832,021 91,937,757 2,981, Morogoro DC 170,368, ,604, ,973, ,676, , ,856, ,928, Ulanga DC 38,568, ,425, ,496, Magu DC 22,333, ,286, ,619, ,574,369 2,045,064 Tandahimba 119 DC 30,284, ,285, ,569, ,391,945 13,177, Mpwapwa DC 29,306, ,832, ,139, ,682, ,456,701 9,704, ,364, ,093, Kongwa DC 672,068, ,975,

243 122 Singida DC 1,408, ,108, ,516,953 31,394, , Singida MC 138, ,341, ,480,012 11,457, ,663 40,900, ,448, ,632, Tunduru DC 357,349,309 51,717, Mbozi DC 84,776, ,292, ,068, ,927, ,140, Tabora DC 62,993, ,899, ,893, ,362, ,530, Morogoro MC 132,641, ,863, ,504, ,511,978 7,992,580 Total 6,376,697,957 33,538,484,026 39,915,181,983 34,107,653,286 5,807,528,

244 Agricultural Sector Development Programme (ASDP) - Financial performance 1 Annexure III Region District Opening Balance Funds Received Funds Available Expenditure Closing Balance ARUSHA Arusha MC 7,576, ,238, ,815, ,615,159 6,199, Arusha DC 67,456, ,778, ,234, ,220, ,014, Monduli Dc 14,419, ,708, ,128, ,810, ,317, Longido DC 2,130, ,341, ,471, ,192, ,279, Meru DC 198,173, ,355, ,528, ,867, ,660, Karatu DC 577,990, ,865, ,057,855, ,202, ,652, Ngorongoro DC 177,488, ,128, ,617, ,866,422 89,750, COAST Kisarawe DC 219,597, ,169, ,921, ,248, ,571, Kibaha DC 162,481, ,739, ,220, ,215, ,005, Mafia DC 10,396, ,999, ,395, ,233,069 15,162, Bagamoyo DC 695,756, ,916, ,361,672, ,693, ,979, Mkuranga DC 871,519, ,201, ,155,720, ,355, ,364, DAR Kibaha TC 3,771, ,570, ,342, ,156, ,185, Rufiji DC 14,211, ,211, ,422, ,392, ,970,

245 Temeke MC 52,927, ,386, ,313, ,816, ,496, Kinondoni Mc 62,942, ,347, ,290, ,779, ,510, DODOMA Ilala MC 14,985, ,198, ,183, ,117, ,066, Mpwapwa DC 404,355, ,637, ,993, ,004, ,988, Bahi DC ,560, ,774, ,905, ,868, Chamwino DC 161,000, ,130,712, ,291,712, ,861, ,850, IRINGA KAGERA Dodoma MC 308,154, ,815, ,970, ,191, ,778, Kondoa DC 216,228, ,747, ,975, ,375, ,600, Kongwa DC 6,498, ,345, ,844, ,950, ,893, Mufindi DC 993,696, ,308,792 1,939,005,042 1,139,647, ,357,270 Njombe TC 11,026, ,796, ,822, ,303,328 15,518,864 Ludewa DC 890,304, ,615,624 1,233,920, ,077,416, ,503, Kilolo DC 315, ,328, ,644, ,110, ,533, Njombe DC 40,274, ,770, ,044, ,778,133 77,266, Iringa MC 16,923,708 78,333,387 95,257, ,333,387 16,923, Iringa DC 1,324,313,048 3,110,755,012 4,435,068, ,727,398,974 1,707,669, Makete DC 157,790, ,908, ,698, ,687, ,011, Chato DC 9,269, ,512, ,781, ,600, ,181,

246 Bukoba DC 34,798, ,086, ,885, ,158, ,726, Muleba DC 663,987,426 1,767,471,248 2,431,458, ,089,277, ,342,181, Karagwe DC 133,159, ,943, ,103, ,390, ,712, Missenvi DC 410,946, ,844, ,791, ,581, ,209, Ngara DC 114,883, ,748, ,631, ,572, ,059, Biharamulo DC 310,351, ,101, ,453, ,902, ,551, KIGOMA Bukoba MC 517, ,093, ,610, ,604, , Kigoma MC 21,033, ,841, ,874, ,048, ,825, Kigoma DC 556, ,868, ,424, ,788, ,636, KILIMANJARO Kibondo DC 1,154,877, ,455, ,975,332, ,222,395, ,937, Kasulu DC 2,040, ,348, ,389, ,086, ,302, Moshi MC 7,103, ,613, ,717, ,472, ,244, Rombo DC 4,141, ,565, ,706, ,564, ,142, Hai DC 197,260, ,875, ,136, ,344, ,792, Same DC 197,168, ,691, ,859, ,120, ,739, Moshi DC 528,390, ,385,773, ,914,164, ,656,576, ,588, Mwanga DC 42,147, ,018,946, ,061,093, ,542, ,551, Siha DC 333,853, ,319, ,106,172, ,071,907, ,265,200.00

247 9 LINDI Kilwa DC 157,364, ,615, ,980, ,583, ,396, Liwale DC 534,596, ,130,806, ,665,403, ,742, ,660, Lindi DC -172,896, ,211, ,315, ,579, ,735, Ruangwa DC 91,341, ,274, ,616, ,290, ,326, MANYARA Lindi MC 10,951, ,149, ,101, ,769, ,331, Nachingwea DC 445, ,802, ,247, ,962, ,284, Kiteto DC 32,752, ,569, ,321, ,777, ,544, Mbulu DC 346,219, ,191, ,411, ,800, ,611, Babati DC 180,456, ,885, ,342, ,911, ,430, Hanang DC 58,440, ,091, ,532, ,308, ,224, Simanjiro DC 386,318, ,082, ,400, ,370, ,029, Babati TC 1,127, ,853, ,981, ,972, , MARA Musoma MC 22,253, ,193, ,446, ,196, ,249, Rorya DC 900,176, ,079,694, ,537, ,517, Bunda DC 350,311, ,859, ,255,170, ,057, ,112, Tarime DC 181,395, ,547, ,943, ,662, ,281,

248 Serengeti DC 881,707, ,448, MBEYA 13 MOROGORO Musoma DC 323,459, ,248, ,125, ,005,622, ,188,747, ,259, ,092,461, ,285, Mbozi DC 12,927, ,977, ,905, ,711, ,194, Mbeya DC 33,515, ,923, ,439, ,650, ,789, Kyela DC 486,901, ,042, ,944, ,266, ,677, Rungwe DC 161,307, ,449,589, ,610,897, ,430,327, ,569, Mbarali DC 1,437, ,039,948, ,041,385, ,162,799, ,413, Chunya DC 1,898, ,775, ,673, ,505, ,168, Ileje DC -1,095, ,489, ,394, ,575, ,818, Mbeya CC 26,228, ,831, ,059, ,024, ,035, Kilombero DC 111,116, ,033,496, ,144,613, ,077,561,473 67,052, Kilosa DC*** 1,106,919, ,308,111, ,415,031, ,583, ,540,447, Mvomero DC 1,295,225, ,883,257, ,178,482, ,958,788, ,219,693, Morogoro DC 536,697, ,079,276, ,615,974, ,812,438 1,236,162, Morogoro MC 21,883, ,040, ,923, ,244, ,678, MTWARA Ulanga DC 1,096,435, ,370, ,456,805, ,437, ,368, Mtwara MC 4,316, ,846, ,162, ,242, ,920,747.00

249 Masasi TC Masasi DC 785, ,081, ,867, ,756, ,110, Mtwara DC 59,802, ,029, ,831, ,136, ,695, Tandahimba DC Nanyumbu DC 43,162, ,129,197, ,172,360, ,086,872, ,488, ,472, ,154, ,626, ,598, ,028, Newala DC 8,471, ,516, ,987, ,583, ,404, MWANZA Sengerema Dc 18,491, ,020,638, ,039,130, ,460, ,669, Ukerewe DC 166,988, ,361, ,350, ,751, ,599, RUKWA Kwimba DC 222,912, ,117,621, ,340,534, ,769, ,764, Geita DC 226,880, Misungwi DC 454,935, ,815, ,467, ,348, ,852, ,723, ,176, ,676, ,129,770 Magu DC 358,311, ,675, ,001,987, ,911, ,076, Mwanza CC 2,388, ,157, ,545, ,917, ,627, Sumbawanga DC 352,750, ,388,224, ,740,975, ,511,377, ,598, Mpanda DC 58,551, ,764,127, ,822,678, ,811,981, ,697, Sumbawanga MC 388, ,634, ,023, ,420, ,

250 17 RUVUMA Nkasi DC 940,698, ,238,005, ,178,704, ,178,208, , Mpanda TC 25,425, ,958, ,384, ,845, ,539, Tunduru DC 42,295, ,172,221, ,214,516, ,041,981, ,534, Mbinga DC 53,507, ,167,669, ,221,177, ,221,035, , Namtumbo DC 16,344, ,628,656, ,645,000, ,642,932,818 2,067, SHINYANGA Songea DC 595,731, ,275,424, ,871,156, ,522,039, ,116, Songea MC 22,843, ,265, ,109, ,716, ,393, Kahama DC 257,053, ,509, ,139,563, ,040, ,522, Bariadi DC 853,914, ,392,968, ,246,882, ,020,896, ,225,985, Kishapu DC 15,964, ,064, ,028, ,501, ,527, Meatu DC Shinyanga DC 47,032, ,327, ,359, ,967, ,391, ,909, ,501, ,411, ,529, ,881, Shinyanga MC 24,364, ,829, ,193, ,571, ,622, Bukombe Dc 422,149, ,074,726, ,496,875, ,792, ,083, SINGIDA Maswa DC 45,909, ,136, ,045, ,232, ,812, Iramba DC 38,174, ,142, ,316, ,316, ,000,

251 Manyoni DC 53,619, ,915, ,535, ,046, ,488, TABORA TANGA Singida MC 101,465, ,571, ,036, ,754, ,281, Singida DC 344,740, ,170, ,910, ,877, ,033, Urambo DC 381,575, ,660, ,238,235, ,644, ,591, Igunga DC 29,329, ,763, ,092, ,810, ,282, Tabora MC 12,064, ,187, ,251, ,141, ,109, Sikonge DC 387,505, ,653, ,054,158, ,126, ,032, Nzega DC 73,219, ,646, ,865, ,511, ,353, Tabora DC 30,304, ,855, ,159, ,506, ,653, Handeni DC 66,165, ,394, ,560, ,981, ,578, Mkinga 316,753, ,107, ,861, ,923, ,937, Kilindi DC 29,681, ,285, ,967, ,005, ,961, Tanga CC 7,508, ,478, ,986, ,660, ,325, Pangani DC 57,257, ,414, ,672, ,177, ,494, Korogwe DC 59,223, ,236, ,459, ,340, ,118, Muheza DC 142,482, ,157, ,640, ,640, ,999, Lushoto DC 564,356, ,809, ,096,166, ,075,911, ,255, Korogwe TC 8,462, ,467, ,929, ,064, ,864, ,326,841, ,454,699, ,781,540, ,543,621, ,237,919,

252 240

253 Annexure IV S/N Health Basket Fund (HBF) Financial Performance Council Opening Balance (Shs) Fund Received (Shs.) Total Fund available (Shs) Total Expenditure (Shs.) Unutilized fund/closing balance (Shs.) 1 ARUSHA DISTRICT 1,962, ,221, ,183, ,497,182 5,686,567 2 MOSHI MUNICIPAL COUNCIL 10,946, ,073, ,020, ,827,242 31,192,771 3 MUHEZA DISTRICT COUNCIL 174,587, ,595, ,183, ,799, ,383,893 4 TANGA CITY COUNCIL 30,561, ,369, ,930, ,820, ,110,638 5 BABATI DISTRICT COUNCIL 42,514, ,371, ,885, ,383,995 89,501,995 6 HAI DISTRICT COUNCIL 18,540, ,855, ,396, ,440, ,955, ARUSHA MUNICIPAL COUNCIL 32,764, ,890, ,654, ,335, ,319,108 8 BABATI TOWN COUNCIL 86,884, ,665, ,550, ,327, ,222,924 9 HANANG DISTRICT COUNCIL 5,833, ,162, ,996, ,838,950-31,842, HANDENI DISTRICT COUNCIL 267,526, ,122, ,648, ,289, ,358, KARATU DISTRICT COUNCIL 30, ,261, ,291, ,950,873 11,340, KILINDI DISTICT 69,594, ,474, ,069, ,316,654 69,752,

254 COUNCIL KITETO DISTRICT COUNCIL 65,126, ,959, ,086, ,887,118 59,199,082 KOROGWE DISTRICT COUNCIL 102,689, ,931, ,620, ,754, ,866,050 KOROGWE TOWN COUNCIL 8,785, ,501, ,286, ,397,910 35,888,862 LONGIDO DISTRICT COUNCIL 7,091, ,472, ,564, ,383,964 60,180,114 LUSHOTO DISTRICT COUNCIL 185,964,815 1,001,077,500 1,187,042,315 1,119,145,316 67,896,999 MBULU DISTRICT COUNCIL 83,362, ,754, ,116, ,766, ,350,700 MERU DISTRICT COUNCIL 10, ,459, ,469, ,618, ,950 MKINGA DISTRICT COUNCIL 78,886, ,507, ,393, ,145,849 68,247,981 MONDULI DISTRICT COUNCIL 6,275, ,021, ,296, ,910,270 48,386,323 MOSHI DISTRICTCOUNCIL 301,658, ,074,900 1,248,733, ,097, ,636,230 MWANGA DISTRICT COUNCIL 16,527, ,175, ,703, ,870,968 79,832,134 NGORONGORO DISTRICT COUNCIL 143,836, ,580, ,417, ,642, ,774,864 PANGANI DISTRICT COUNCIL 14,964, ,682, ,647, ,063, ,583, ROMBO DISTRICT COUNCIL 42,778, ,040, ,818, ,168, ,649, SIHA DISTRICT 96,530, ,217, ,747, ,275,219 25,472,

255 COUNCIL SAME DISTRICT COUNCIL 40,170, ,428, ,598, ,476,534 70,121,466 BIHARAMULO DISTRICT COUNCIL 32,375, ,267, ,643, ,568, ,075, BUKOBA DISTRICT COUNCIL 24,684, ,114, ,798, ,955, ,843, CHATO DISTRICT COUNCIL 36,497, ,812, ,309, ,455, ,853,788 NGARA DISTRICT COUNCIL 92,259, ,905, ,164, ,990, ,173,996 KARAGWE DISTRICT COUNCIL 121,373, ,427,000 1,085,800, ,087, ,713, MISSENYI DISTRICT COUNCIL 39,756, ,475, ,232, ,764, ,467, MUSOMA DISTRICT COUNCIL 138,321, ,371, ,693, ,340, ,352, BUNDA DISTRICT COUNCIL 34,634, ,305, ,939, ,157, ,782, MUSOMA MUNICIPAL COUNCIL 19,932, ,054, ,987, ,531, ,456, RORYA DISTRICT COUNCIL 82,394, ,151, ,545, ,607, ,937, SERENGETI DISTRICT COUNCIL 44,426, ,881, ,307, ,707, ,599, TARIME DISTRICT COUNCIL 41,608, ,045, ,653, ,247, ,405, MAGU DISTRICT COUNCIL 807,465 1,010,672,500 1,011,479, ,951, ,528,

256 KWIMBA DISTRICT COUNCIL 54,240, ,923, ,164, ,555, ,608, MWANZA CITY COUNCIL 193,460,352 1,092,777,100 1,286,237,452 1,194,543,533 91,693,919 BUKOMBE DISTRICT COUNCIL 80,770, ,424, ,013,195, ,949, ,246, BARIADI DISTRICT COUNCIL 3, ,437,163, ,437,167,074 1,437,167, KISHAPU DISTRICT COUNCIL 83,221, ,904, ,126, ,929, ,196, MASWA DISTRICT COUNCIL 41,203, ,076, ,279, ,026, , MEATU DISTRICT COUNCIL 116,575, ,589, ,165, ,764, ,400, KAHAMA DISTRICT COUNCIL 68,050, ,405,081, ,473,131,761 1,345,996, ,134, SHINYANGA DISTRICT COUNCIL 11,313, ,318, ,631, ,631, SHINYANGA MUNICIPAL COUNCIL 37,851, ,698, ,549, ,390, ,159, BUKOBA MUNICIPAL COUNCIL 0 169,115, ,115, ,115, MULEBA DISTRICT COUNCIL 77,117, ,738, ,855, ,432, ,423, BAGAMOYO DISTRICT COUNCIL 118,604, ,694, ,298, ,309, ,988,256 KIBAHA DISTRICT COUNCIL 18,496, ,864, ,360, ,293,485 9,067,357 KIBAHA TOWN COUNCIL 1,283, ,963, ,246, ,697,190 1,549,

257 KISARAWE DISTRICT COUNCIL 71,661, ,243, ,905, ,813,086 69,092,061 MAFIA DISTRICT COUNCIL 7,870, ,971, ,841, ,876,665 4,964,700 MKURANGA DISTRICT COUNCIL 0 512,328, ,328, ,643,103 37,685,697 RUFIJI DISTRICT COUNCIL 62,982, ,115, ,098, ,768,293 7,329,808 MANYONI DISTRICT COUNCIL 14,711, ,741, ,453, ,558,577 38,895,100 DODOMA MUNICIPAL COUNCIL 14,590, ,697, ,287, ,302, ,985, KIGOMA DISTRICT COUNCIL 0 1,194,415,400 1,194,415,400 1,036,423, ,991,814 KIGOMA/UJIJI MUNICIPAL COUNCIL 54,537, ,733, ,270, ,506,075 4,764,027 TABORA MUNICIPAL COUNCIL 17,604, ,824, ,429, ,298,784 65,130,534 BAHI DISTRICT COUNCIL 276, ,298, ,574, ,598,086 56,976,454 CHAMWINO DISTRICT COUNCIL 17,781, ,902, ,683, ,031, ,652,059 IGUNGA DISTRICT COUNCIL 174,448, ,075, ,523, ,610, ,913,000 IRAMBA DISTRICT COUNCIL 0 994,817, ,817, ,907, ,910, KASULU DISTRICT COUNCIL 11,092,056 1,451,713,000 1,462,805,056 1,412,063,136 50,741,

258 KIBONDO DISTRICT COUNCIL 56,514, ,433,600 1,033,947,600 1,023,431,022 10,516,578 KONDOA DISTRICT COUNCIL 71,051, ,023,963,100 1,095,014,866 1,046,301, ,713, NZEGA DISTRICT COUNCIL 104,333, ,163,600 1,069,497, ,319, ,177,517 SIKONGE DISTRICT COUNCIL 44,084, ,751, ,835, ,560, ,275,195 TABORA DISTRICT COUNCIL 81,591, ,869, ,460, ,991,905 15,468,375 TEMEKE MUNICIPAL COUNCIL 639,554,302 1,597,999,400 2,237,553,702 1,714,252, ,301,063 IRINGA MUNICIPAL COUNCIL 26,555, ,640, ,195, ,655,989 11,539,913 NJOMBE TOWN COUNCIL 28,754, ,361, ,116, ,729,668 41,386,612 CHUNYA DISTRICT COUNCIL 2,880, ,475, ,355, ,874,003 58,481,540 ILEJE DISTRICT 378,572,363 COUNCIL 88,586, ,368, ,954,679 32,382,316 KYELA DISTRICT COUNCIL 26,004, ,612, ,616, ,661, ,955,867 MBARALI DISTRICT COUNCIL 0 587,712, ,712, ,945,111 74,767,089 MBEYA CITY COUNCIL 119,827, ,994, ,822, ,891,771 32,930,664 MBEYA DISTRICT COUNCIL 103,479, ,611, ,091, ,060, ,030,049 MBOZI DISTRICT COUNCIL 94,152,065 1,190,592,800 1,284,744,865 1,199,131,874 85,612,

259 RUNGWE DISTRICT COUNCIL 305,170, ,498, ,668, ,891, ,777,117 MPANDA DISTRICT COUNCIL 60,945, ,056, ,001,662 1,112,205, ,203,435 MPANDA TOWN COUNCIL 4,744, ,223, ,967, ,406,772 6,561,179 NKASI DISTRICT COUNCIL 82,313, ,024, ,338, ,884,667 33,453,398 SUMBAWANGA DISTRICT COUNCIL 78,120, ,539, ,042,659, ,051, ,607, MBINGA DISTRICT COUNCIL 19,292, ,060,300 1,013,352, ,409, ,943,233 NAMTUMBO DISTRICT COUNCIL 7,669, ,865, ,534, ,590,309 67,944,000 SONGEA DISTRICT COUNCIL ,890, ,891, ,857, , SONGEA MUNICIPAL COUNCIL 1,863, ,073, ,937, ,987, ,949, IRINGA DISTRICT COUNCIL 114,699, ,095, ,795, ,359, ,435,290 KILOLO DISTRICT COUNCIL 36,881, ,654, ,535, ,535,799 0 LUDEWA DISTRICT COUNCIL 42,805, ,855, ,661, ,312,114 11,349,389 MAKETE DISTRICT COUNCIL 84,637, ,390, ,027, ,954, ,072,926 MUFINDI DISTRICT COUNCIL 53, ,355, ,409, ,409,644 0 NJOMBE DISTRICT COUNCIL 332,907, ,825,300 1,075,732, ,962, ,770,

260 SUMBAWANGA MUNICIPAL COUNCIL 88,798, ,696, ,494, ,020, ,474,240 TUNDURU DISTRICT COUNCIL 21,080, ,156, ,236, ,017, ,218,834 MASASI DISTRICT COUNCIL 70,536, ,735, ,272, ,308, ,964, MTWARA DISTRICT COUNCIL 15,948, ,150, ,098, ,452, ,645, MTWARA MUNICIPAL COUNCIL 1,467, ,811, ,278, ,312, ,965, NANYUMBU DISTRICT COUNCIL 33,935, ,169, ,104, ,768,448 19,335,987 NEWALA DISTRICT COUNCIL 63,850, ,978, ,828, ,679, ,149, TANDAHIMBA DISTRICT COUNCIL 141,157, ,282, ,440, ,684, ,755,616 KILWA DISTRICT COUNCIL 221,611, ,288, ,900, ,114, ,785, LINDI DISTRICT COUNCIL 29,864, ,623, ,488, ,408, ,079, LINDI MUNICIPAL COUNCIL 20,946, ,978, ,924, ,091,185 36,833,305 LIWALE DISTRICT COUNCIL 0 215,284, ,284, ,773, ,511, NACHINGWEA DISTRICT COUNCIL 24,539, ,363, ,903, ,940, ,963, RUANGWA DISTRICT COUNCIL 141,430, ,456, ,886, ,179, ,707,

261 MISUNGWI DISTRICT COUNCIL 2,990, ,742, ,732, ,410,099 17,322,260 UKEREWE DISTRICT COUNCIL 141,884, ,971, ,855, ,978,251 73,877,476 SENGEREMA DISTRICT COUNCIL 30,138, ,194,797, ,224,935,932 1,032,266, ,669, GEITA DISTRICT COUNCIL 0 1,704,151,600 1,704,151,600 1,651,026,600 53,125,000 KILOMBERO DISTRICT COUNCIL 66,305, ,221, ,526, ,397, ,128, MOROGORO MUNICIPAL COUNCIL 6,320, ,283, ,604, ,604, ,000,000 KONGWA DISTRICT COUNCIL 8,601, ,166, ,767, ,847, ,920, SINGIDA DISTRICT COUNCIL 24,290, ,845, ,135, ,391, ,743, SINGIDA MUNICIPAL COUNCIL 4,892, ,468, ,361, ,131,856 14,229,265 URAMBO DISTRICT COUNCIL 478,247, ,153,300 1,366,401, ,556, ,844,380 MPWAPWA DISTRICT COUNCIL 92,237, ,888, ,125, ,427, ,697, KILOSA DISTRICT COUNCIL 36,526,708 1,205,589,400 1,242,116,108 1,222,405,288 19,710,820 ULANGA DISTRICT COUNCIL 31,801, ,496, ,298, ,926,275 73,371,775 MOROGORO DISTRICT COUNCIL 13,435, ,454, ,889, ,760,536 8,129,094 ILALA MUNICIPAL COUNCIL 192,561,601 1,341,324,800 1,533,886, ,744, ,141,

262 KINONDONI MUNICIPAL COUNCIL 11,730, ,241,694, ,253,424,556 2,239,915, ,508, MVOMERO DISTRICT COUNCIL 25,963, ,781, ,745, ,144, ,600, SIMANJIRO DISTRICTCOUNCIL 84,733, ,622, ,355, ,114, ,241,272 8,782,526,242 80,435,231,856 89,217,758,099 76,812,007,208 12,405,750,

263 Annexure V (a) FINANCIAL PERFORMANCE FOR OTHER PROJECTS S/ N o Name of project Opening balance (Shs) 1 LGSP - 2 HSPS- PMO- RALG 3 TEITI 130, Amount received (Shs) 251 Expenditure (Shs) Unspent balance (Shs) 17,300,111, ,300,111, ,946,466, ,645, ,000, ,130, ,877, ,252, ,275,380, ,275,380, ,197, ,183, RSSP 1-81,312,475, ,312,475, ,562,284, ,190, NMCP 1,059,730, ,175, ,168,906, ,003,691, ,214, LSRP - 17,312,025, ,312,025, ,480,697, ,831,327, FEAT 517,781, ,505, ,140,287, ,697, ,590, TEDAP- 3,474,774, MEM 488,307, ,963,082, ,056,183, ,906,898, Compone nt 9 EAPHLNP 535,318, ,234,538, ,769,856, ,136,785, ,633,070, LSDF- PMO- RALG 5,908, ,908, ,755, ,893.48

264 11 RFFP - 12 EAAPP 195,698, SIDA/NOR AD/MEM BIOFUELS Project - 14 MIVARF - 15 LTIRDP - 16 LVEMP (Phase II) 17 MLDF UNDP 18 Makete District Council 19 MSWYWC D Zanzibar UNDP 20 PMO - UNDP 21 EGPAF UNDP 22 MHSWEH- UNDP 23 VPO UNDP 249,849, ,472, , ,478, ,478, ,523, ,955, ,972,256, ,167,954, ,528,485, ,469, ,066,256, ,066,256, ,976, ,279, ,590,878, ,590,878, ,654,443, ,936,434, ,257,683, ,257,683, ,364,680, ,893,002, ,922,974, ,172,823, ,146,439, ,384, ,670, ,670, ,580, , ,317, ,789, ,789, ,591, ,591, ,880, ,711, ,329, ,329, ,348, (1,019,098.00) 467,038, ,913, ,090, ,822, ,778, ,778, ,988, ,790, ,925, ,925, ,470, ,454,901.50

265 24 FVPO - Zanzibar UNDP 485,168, ,168, ,033, ,134, RITA - 140,194, ,194, ,402, ,791, Temeke 105,625, Municipal UNDP 520,552, ,178, ,447, ,730, MOEVT - UNDP 3,214,101, ,214,101, ,113,400, ,700, TACAIDS 94,442, ,072, ,514, ,312, ,202, MoW - - UNDP 106,696, ,696, ,405, ,290, SVPO 66,474, Zanzibar UNDP 146,581, ,056, ,159, ,897, MOEVT - Zanzibar UNDP 260,030, ,030, ,030, TFDA- - UNDP 346,533, ,533, ,312, ,220, TFS - UNDP 235,972, ,972, ,518, ,454, PMO - RALG - UNDP 71,630, ,630, ,630, NBS - 117,926, UNDP 2,224,784, ,342,710, ,068,596, ,114, VPO- - NEMC- 125,861, ,861, , ,963,

266 UNDP 37 Save the Children- UNDP - 38 TFNC - UNDP 39 PSI UNDP - 40 MOHSW- UNDP - 221,351, ,351, ,351, ,016, ,016, ,193, (66,176,682.00) 198,539, ,539, ,898, (479,359,852.00) 347,188, ,188, ,188, TOTAL 6,792,010, ,822,857, ,614,867, ,690,646, ,924,220,

267 FINANCIAL PERFORMANCE FOR OTHER PROJECTS Annexure V (b) S/N o Name of project Opening balance (US$) Amount received (US$) Total fund available (US$) 255 Expenditure (US$) Unspent Balance (US$) TSSP 25,664, ,290, ,955, ,675, ,279, SCP 19,822, ,907, ,730, ,295, ,435, STHEP 11,975, ,211, ,186, ,233, ,952, PSCP 5,042, ,059, ,102, ,029, , SCTCP 15,539, ,677, ,217, ,698, ,518, CCTTFFA 289, , , , , RCIP - 4,991, ,991, , ,772, MMRP 321, ,468, ,789, ,430, , PSRP- Holding account 2,313, ,256, ,569, ,634, ,935, LGRP Holding 20,583, ,817, ,401, ,262, , Account TMBF-Holding Account 5,330, ,224, ,555, ,206, ,349,201.17

268 12 WSBF Holding 14,707, ,158, ,866, ,131, ,734, Account) 13 NRWSSBF- Holding 1,009, ,775, ,785, ,136, ,648, Account 14 HBFF-Holding Account 3,806, ,507, ,314, ,152, ,161, LSBFF-Holding Account 3,280, ,462, ,742, ,472, ,270, ASDPBF Holding 691, , , , Account) 17 Financing FSSBF-Holding 590, ,430, ,020, ,020, (0.00) Account) SEP PSSEDP - 18 Holding 484, , , Account STATCAP - 19 Basket Fund- 5,847, ,847, ,275, ,572, Holding Account 20 SEDP II- Holding 11,838, , ,846, ,113, ,733, Account 21 Mothers2Moth - 633, , , ers - UNDP TOTAL 142,600, ,896, ,497, ,890, ,607,

269 Annexture V (c) CONTRIBUTIONS FROM DEVELOPMENT PARTNERS Project AfDB (Shs) UNITED NATIONS (Shs) WORLD BANK (IDA) (Shs) GEF (Shs) TZ GVT (Shs) OTHER DONERS (Shs) 1 ASP 1,624,509, ASDP PMO - RALG 300,000, BHSP IDA CREDIT 785,702, BIOFUELS 37,030,000, CCTTFA UA 6 DRTA 1,089,024, ,643, ,724, DASIP 100,923,494, ,584,478, DHIR PMO - RALG 45,842, EAPHLNP 4,234,538, ES - FEAT VOTE ,505, HSPS 687,000, LSRP 6,586,643, ,976,878, LGSP 17,300,111, LGTP & VTTP 277,505, MIVARF 3,878,900, ,711,978, PSCP 17,874,851, PSCP - COMP 1 31,554,497, PSRP 4,059,677, ,743,026, ,261,114,

270 19 REA - WBFP 209,300,000, ,465,000, ,610,000, RCIP 21 RSSP1 52,739,963, ,434,034, ,138,477, RWSSP 125,000, CTCP2 342,608,000, ,227,000, ,849,000, SBMRP 29,304,204, ,125,470, STHEP 72,790,302, SMMRP 17,001,521, ,463,471, SMMR 6,577,785, ,432,221, TSCP 21,112,667, ,888,987, TASAF II 39,288,285, ,564,073, TEDAEP 488,307, TGDLC 48,077, ,951,171, MEWATA 27,070, MoEVT UNICEF 3,214,101, MoEVT UNICEF ZNZ 260,030, NBS UNFPA 2,224,784, PSI UNDP 198,539, RITA UNDP 140,194, TACAIDS UNDP 3,080,459, TFDA 346,533, UNDAP EGPAF 467,913,

271 41 UNDAP AAP(VPO) 283,925, UNDP ME&M 763,327, UNDP MoW 106,696, UNDP MNR&T 235,972, UNDP NEMC AAP 125,861, UNDP WP ZNZ 485,168, UNICEF TEMEKE 501,460, UNICEF DISASTER 48 ZNZ 145,181, UNICEF PMO - RALG 71,630, UNICEF TFNC 534,016, TOTAL 204,148,083, ,212,863, ,749,098, ,089,509, ,387,572, ,247,403,

272 Activities not yet implemented 1 Mbozi DC 6,750, Kishapu DC 9,460, Chunya DC 10,460, Kilwa DC 14,495, Kongwa DC 25,000, Iringa MC 53,276, Mbeya CC 61,315, Kasulu DC 80,000, Mbeya DC 83,400, Kondoa DC 90,666, Biharamulo DC 107,742, Arusha DC 121,620, Handeni DC 137,578, Magu DC 146,160, Ileje DC 155,885, Bukoba DC 168,000, Kisarawe DC 187,440, Babati DC 192,387, Bariadi DC 220,000, Iringa DC 250,162, Geita DC 263,040, Kibaha DC 310,005, Kahama DC 457,000, Kilombero DC 785,349, Total 3,937,196, Annexure VI 260 Office of the Controller and Auditor General AGR/DFP/2011/2012

273 Unresolved previous matters Annexure VI 1 Arusha MC 92,054, Mbinga DC 6,605, Babati DC 113,964, Meatu DC 21,800, Bariadi DC 397,161, Meru DC 18,480, Biharamulo 4 DC 343,537, Misungwi DC 4,699, Bukoba MC 17,908, MKINGA DC 12,712, Bukombe 6 DC 521,728, Mkuranga DC 5,001, Chato DC 333,154, Morogoro DC 17,886, Chunya DC 741,523, Morogor MC 11,854, Geita 58,987, Mpanda DC 6,697, Hanang DC 38,010, Mpanda TC 51,283, Igunga DC 514,095, Mufindi DC 93,175, Ileje DC 13,535, Musoma MC 28,987, Iramba DC 14,976, Mwanza CC 214,221, Kahama DC 366,399, Nachingwea DC 217,550, Karagwe DC 262,870, Rorya DC 8,842, Karatu DC 238,488, Ruangwa DC 97,520, Kasulu DC 202,954, Rufiji DC 9,165, Kibaha TC 380,000, Rungwe DC 60,780, Kilimbero 1,125,999, Sengerema DC 71,112, Kilwa DC 52 Serengati DC 31,984, Office of the Controller and Auditor General AGR/DFP/2011/

274 21 9,374, Kinondoni DC 45,215, Sikonge DC 12,657, Kishapu DC 708,674, Songea DC 350,592, Kiteto DC 29,169, Songea MC 9,692, Kondoa DC 132,000, Sumbawanga DC 59,497, Kwimba DC 43,615, Sumbawanga MC 19,586, Lindi DC 87,560, Tabora dc 247,886, Lindi MC 8,954, Tabora MC 69,371, Mafia DC 50,707, Tarime DC 32,050, Magu DC 8,400, Tunduru DC 2,966, Masasi DC 52,207, Ukerewe DC 24,931, Maswa DC 3,080, Urambo DC 24,488, Mbeya CC 61,315, Kilosa DC 225,000, Total 9,086,703, Office of the Controller and Auditor General AGR/DFP/2011/2012

275 Ineligible Expenditure ASDP Annexure VII Diversion of fund Unbudgeted activities 1 Chunya DC 118,500,000 1 Bariadi DC 1,680, Geita DC 62,234,000 2 Bukoba DC 3,815, Igunga DC 44,937,000 3 Chamwino DC 38,688, Ileje DC 4,418,000 4 Dodoma MC 1,200, Magu DC 230,000,000 5 Karagwe DC 22,926, Monduli DC 2,909,000 6 Kibondo DC 107,412, Mufindi DC 101,600,000 7 Kigoma DC 1,710, Musoma MC 10,415,000 8 Kigoma MC 4,995, Namtumbo DC 6,339,000 9 Korogwe TC 687, Nkasi DC 22,278, Lindi DC 30,954, Rufiji DC 1,505, Lindi MC 3,796, ,135, Mbeya DC 25,000, VAT exempted 13 Mtwara MC 2,000, Chunya DC 5,012, Muleba DC 8,177, KondoaDC 7,866, Musoma DC 5,076, Muleba DC 96,975, Ruangwa DC 41,088, Nzega DC 4,030, Total 299,206, Singida DC 11,450, Urambo DC 1,287, ,622, loan not recovered/ Inter Account Indebtedness 1 Chato DC 1,600, Dodoma MC 1,200, Kibaha DC 1,209, Tarime DC 1,500, Total 5,509, Office of the Controller and Auditor General AGR/DFP/2011/2012

276 Improperly Vouched Expenditure - ASDP Annexure VIII 1 Shinyanga MC 720, Simanjiro DC 1,517, Kilombero DC 1,600, Chato DC 3,000, Tunduru DC 3,320, Mpwawa DC 3,796, Bunda DC 4,900, Karatu DC 5,255, Namtumbo DC 5,569, Hanang DC 5,898, Kisarwe DC 7,464, Kyela DC 7,910, Morogoro DC 8,200, Bariadi DC 8,800, RORYA DC 12,585, Mbarali DC 12,639, Liwale DC 14,043, Ruangwa DC 19,095, Mvomero DC 19,875, Misungwi DC 25,503, Sengerema DC 27,485, Kondoa DC 30,588, Lindi DC 33,038, Nachingwea DC 34,614, Arusha DC 47,823, Chmwino DC 48,813, Total 394,055, Office of the Controller and Auditor General AGR/DFP/2011/2012

277 Imprest not retired ASDP Annexure IX 1 Bahi DC 18,123, Kibondo DC 11,384, Mpanda DC 10,785, Kigoma DC 8,520, Mkinga DC 6,014, Geita DC 4,622, Ruangwa DC 4,108, Morogor DC 3,474, Kisarawe DC 2,291, Kigoma MC 2,225, Kilombero DC 1,600, Monduli DC 1,074, Hanang DC 930, Kahama DC 704, Lindi DC 60, Total 75,916, Office of the Controller and Auditor General AGR/DFP/2011/2012

278 Annexure X Outstanding Matters HSBF S/N Council Amount (shs) 1 Moshi MC 8,175,648 2 Muheza DC 25,566,575 3 Babati DC 136,706,863 4 Karatu DC 19,096,195 5 Kilindi DC 48,680, Kiteto DC 6,060,000 7 Longido DC 12,784, Lushoto DC 136,030, Meru DC 34,208, Ngorongoro DC 25,073, Pangani DC 4,962, Rombo DC 2,064, Siha DC 8,844, Chato DC 48,701, Ngara DC 35,845, Karagwe DC 693,874, Missenyi DC 48,701, Musoma DC 23,996, Musoma MC 13,215, Rorya DC 409,188, Tarime DC 23,380, Magu DC 60,736, Kwimba DC 614,734, Mwanza CC 411,810, Bukombe DC 5,511, Kishapu DC 152,712, Meatu DC 42,501, Kahama DC 119,023, Shinyanga DC 72,315, Bukoba MC 7,135, Muleba District Council 81,547, Bagamoyo District Council 93,043, Kibaha District Council 16,922,000 Office of the Controller and Auditor General AGR/DFP/2011/

279 34 Dodoma Municipal Council Kigoma/Ujiji Municipal Council Tabora Municipal Council 281,309, Bahi District Council 228,973, Igunga District Council 839,646, Kasulu District Council 59,285, Kibondo Council 376,104, Kondoa District Council 96,216, Sikonge District Council 309,875, Tabora District Council 1,014,485, Temeke Municipal Council 60,091, Chunya District Council 3,381, Ileje District Council 116,675, Mbeya District Council 52,589, Rungwe District Council 1,801, Mpanda District Council 178,333, Mpanda Town Council 32,064, Nkasi District Council 120,132, Sumbawanga District Council 154,217, Mbinga District Council 21,069, Namtumbo District Council 3,561, Songea District Council 52,480, Songea Municipal Council 4,485, Ludewa District Council 73,918, Njombe District Council 746,303, Tunduru District Council 8,479, Masasi District Council 45,400, Mtwara Municipal Council 14,103, Nanyumbu District Council 1,604, Newala District Council 15,678, Kilwa District Council 247,204, Lindi District Council 70,227, Lindi Municipal Council 39,485, Liwale District Council 75,406, Nachingwea District Council 106,355,935 Office of the Controller and Auditor General AGR/DFP/2011/

280 69 Misungwi District Council 15,611, Ukerewe District Council 158,312, Sengerema District Council 271,950, Geita District Council 311,486, Kilombero District Council 194,277, Kongwa District Council 7,887, Urambo District Council 770,199, Kilosa District Council 46,152, Ulanga District Council 24,354, Morogoro District Council 58,175, Mvomero District Council 3,210,000 Total 10,982,257, Office of the Controller and Auditor General AGR/DFP/2011/2012

281 OFISI YA TAIFA YA UKAGUZI WA HESABU ZA SERIKALI Head Office The controller and Auditor General, National Audit Office, Audit House, Samora Avenue / Ohio Street P.O.Box 9080, Dar es Salaam, Tanzania Tel: / 8, Fax: ocag@nao.go.tz, Website: REGIONAL OFFICES (RESIDENT /AUDITORS ARUSHA P.O.BOX 202 ARUSHA DODOMA P.O.BOX 950 DODOMA KIGOMA P.O.BOX 213 KIGOMA MANYARA P.O.BOX 391 BABATI IRINGA P.O.BOX 94 IRINGA MBEYA P.O.BOX 333 MBEYA SHINYANGA P.O.BOX 219 SHINYANGA SINGIDA P.O.BOX 122 SINGIDA RUVUMA P.O.BOX 245 SONGEA MOROGORO P.O.BOX 738 MOROGORO RUKWA P.O.BOX 169 SUMBAWANGA TABORA P.O.BOX 22 TABORA KAGERA P.O.BOX 719 BUKOBA LINDI P.O.BOX 24 LINDI TANGA AUDIT BRANCH P.O.BOX 113 TANGA KILIMANJARO P.O.BOX 646 MOSHI MTWARA P.O.BOX 130 MTWARA PWANI P.O.BOX KIBAHA MWANZA P.O.BOX174 MWANZA O MUSOMA P.O.BOX 423 MUSOMA Office of the Controller and Auditor General AGR/DFP/2011/2012