By Athnus Faith
On September 13th 2017, Robina Nabbanja, Parliamentary Commissioner of Parliament tabled a motion on the floor of the August House seeking approval to appoint an auditor to audit the Office of the Auditor General.
Nabbanja, whose motion was seconded by Arinaitwe Rwakajara (Workers MP) who also doubles as Parliamentary Commissioner cited Article 163(9) of the Constitution and Section 36 of the National Audit Act 2008 that gives Parliament mandate to appoint an Auditor to audit books of audit for the Auditor General.
The Commissioner’s pronouncement would bring an end to the over decade long questioning on why the Auditor General, whose Office reports directly to Parliament has not been audited for over a decade from 2005.
The Parliament Service Commission which is a procuring entity of Parliament invited bids through the International Open bidding method, for procurement of an auditor to audit the books of accounts of the auditor General, for a period running from 2005/2006 to 2016/2017.
M/S Kisaka & Company a certified public accounts emerged the best evaluated bidder, to audit the account of the office of the Auditor General from 2005 to 2017.
However, there were objections.
Abdu Katuntu, (Bugweri County MP) stood up on point of procedure questioning why Oulanyah put up the motion to debate before Nabbanja could justify her motion.
“I thought in our Rules of Procedure, the mover of the motion has to speak to it. We need to know how they arrived at the decision, how many firms bid then we can put up a meaningful debate. But just to throw a motion at us to debate, what are we going to debate?” Katuntu asked.
Katuntu, who is also the Chairperson of Parliamentary Committee of Commissions, Statutory Authorities and State Enterprises (COSASE) highlighted that the office of the auditor general has a number of challenges and needed to know if the best evaluated bidder would be in position to provide solutions in their audit report.
The Bugweri County MP explained, “We want to know whether before they arrived at that decision, they addressed themselves to the challenges in that institution. I don’t want to be tempted to go into debate without knowing exactly how they arrived at that decision. After they have done that, then we will be able to make a meaningful contribution and aid the process as required by the law.”
Oulanyah cleared himself of any blame telling Katuntu that although he asked Nabbanja to justify her motion, the commission said it was self explanatory that is why he opened the floor for debate on the motion.
Nandala Mafabi (Budadiri West MP) also rose saying he was in support of Katuntu demanding the parliamentary commission to explain why it took the body over ten years to appoint an auditor to audit the books of accounts of the Auditor General.
“We are appointing an auditor to audit the Auditor General from 2005 to 2017 it is 12 years, that raises a big issue. The office of the Auditor General is supposed to be above all offices and should lead by example and we need the Commission to explain to us why they were hiding the office of the Auditor General for all the twelve years. This is an issue we need to first get an explanation,” Nandala argued.
The Budadiri West MP demanded the Commission to produce a procurement report that detailed how the evaluation was conducted to inform the commission to zero down on Kisaka and Company.
He said the report should explain the capacity of the firm that had been named best evaluated bidder to audit ten years and come up with a report in the shortest time possible.
In her report, Nabbanja revealed that when adverts were published calling for firms to audit the auditor general through the international open bidding process, the bid attracted three firms; BIDO East Africa, Kisaka & Company and Thompson & Company.
The Commission attributed the low response to the terms of reference that barred firms from bidding that had undertaken work with the office of the Auditor General in the last three years.
The reason for this requirement according to the Parliamentary Commission was to preserve the principle of independence of the auditor to be appointed and uphold the provisions of the code of ethics.
Why Auditor General Hasn’t Been Audited
Reports of Parliament failing to appoint an auditor to audit the Auditor General first came up in January 2017.
At the time, the Auditor General John Muwanga had been accused of quietly suffocating attempts to have his office audited for the last 12 years.
Questions started arising after members of the public wondered why the audit report on the Office of the Auditor General hadn’t been made public despite the fact that Nexia Johnson & Johnson Certified Accountants, a consortium of independent accounting and consulting firms that had won the contract in 2012.
It was alleged that although Nexia Johnson & Johnson carried out an audit on the Office of the Auditor General’s and the draft report submitted to Parliament on February 26th 2015, Jane Kibirige, Clerk to Parliament never been tabled the report before the August House for Legislators to debate its findings.
According to media reports, the audit firm had discovered “non- accountability for colossal amounts of money” to the tune of billions of shillings.
The said draft report also exposed what auditors described as non-accountability by Office of Auditor General (OAG) for many accounts in Bank of Uganda, misreporting and limited capacity in OAG to spot impropriety.
The said non-accountability in this case was particularly discovered at many bank accounts in Bank of Uganda that characterized misreporting, and limited capacity by the Auditor General to contain the vice.
The squabble attracted the attention of Prime Minister, Ruhakana Rugunda who wrote a letter to the Speaker of Parliament, on July 14th 2016, detailing complaints by Nexia Johnson & Johnson Certified Accountants raising alarm on what the firm called grave accountability at Office of the Auditor General.
In his letter, the Leader of Government raised concerns over the failure by the Clerk to Parliament (Jane Kibirige) to present the draft Audit Report and Confidential Note to the Parliamentary Commission that would later move to table the report on the floor for debate.
Rugunda also revealed that the audit firm had stated that both the Auditor General and Parliamentary Commission were non-cooperative which led to the four year delay for the audit process to kick off as had earlier been planned.
As if that wasn’t enough, Nexia Johnson & Johnson Certified Accountants blamed the collapse of the audit consortium on the compromise from the Auditor General.
Parliament Speaks Out
Following the media reports, Parliament as the body that oversees the activities of the Auditor General because it’s Parliament the Auditor General reports to issued a press statement on Friday, 13th January 2017 in which they informed the public that the institution was sourcing auditors for Office of the Auditor General
The statement read in part, “Following media reports implying that the Auditor General has blocked an internal audit of the Office of the Auditor General (OAG) for the last twelve years, the Office of the Clerk to Parliament would like to clarify that the most recent attempt at auditing the OAG was unsuccessful.”
Parliament went further revealing that the process, which involved a consortium of three firms: Nexia Johnson & Johnson CPA, Kisaka & Co CPA and Data Figure & Co. CPA ended up in arbitration due to accusations and counter accusations amongst the parties involved.
The statement further highlighted that on 1st August 2014, the Consortium had been awarded a six months contract ending on 28th February 2015, to audit the OAG for the period covering the financial years 2005/2006 – 2012/2013.
“However, disagreements amongst the three partners in the consortium emerged following the payment of a mobilization fee of Shs224.6m to Nexia Johnson & Johnson CPA on their behalf,” Parliament argued.
The institution also explained why auditing of the Auditor General took decades stating, “Following the failure by the consortium to act, audit and report to the Speaker about the auditing process according to the contract, the Parliament’s Contracts Committee terminated their contract, acting on the basis of a recommendation by the Contracts Manager.”
Subsequent to the arbitration that was concluded and awarded in the Parliament’s favor, the institution embarked on a new process by the Parliamentary Commission to procure an auditor for the OAG.
Parliament argued that the new process would be the third attempt by Parliament to audit the Office of the Auditor General, which indicates the importance Parliament puts to its accountability and oversight functions.
The statement went further stating, “Parliament, through both the plenary and its committees is at the core of demanding and ensuring proper accountability of public funds. It shall continue to pursue this line of securing, through a smooth and transparent process, the required competent firms to carry out an audit of the Office of the Auditor General as prescribed by the law.”
Questions on what happened to the earlier procurement process were also hinted about by Nandala when the motion to hire a new auditor was tabled.
“I recall there was a time when we were tempted to appoint the auditor and when we appointed the auditor I think Johnson and Johnson shortly, the other one was a consortium of auditors when they saw a bulk of money, they sacked one and they went with our money. What happened to that audit?” Nandala asked last month.
He added, “We need that report first, before we can deal with the other one. There was John Nyende who had appointed as the auditor, we have never seen that report. I am raising that as an institutional memory because I have been around for a good period of time.”
In reply, Oulanyah said, “There are two things if we are going to debate the motion before us. But to begin asking why ten years, that’s outside this motion. We appoint people and then there are challenges, there is the IGG and the whole process was stopped. The earlier audit wasn’t done.”