Zimbabwe places 10 parastatals under microscope ahead of transformation


Finance Minister Patrick Chinamasa

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

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

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

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

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

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

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

Follow us on Twitter @FingazLive and on Facebook – The Financial Gazette