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Auditor General pins NSSF on billions in suspense account

Auditor General John Muwanga presents the audit report to Deputy Speaker, Anita Among. Photo by Olive Nakatudde

Kampala, Uganda | THE INDEPENDENT | Auditor General John Muwanga has told the select committee investigating operations of the National Social Security Fund (NSSF) that the entity’s management has over the years failed to address the recurrent query about savers’ money on a suspense account.

Muwanga together with several directors of audit had appeared before to committee to explain the role and responsibilities of his office in the audit of the Fund.

“Over the years, I have exercised my mandate and appointed reputable international audit firms to undertake a financial audit of NSSF on my behalf,” said Muwanga.

In his report to the committee, Edward Akol, the Assistant Auditor General in charge of Audits said that over the past three years, there have been unallocated members’ funds accumulating on an account.

He noted that the Fund did not allocate to members’ individual accounts a sum of 38.21 billion shillings in 2020, 45 billion in 2021 and 57 billion in 2022. Akol attributed this to incomplete errors in the members’ records. The office of the Auditor General also blames employers for failing to follow up with NSSF with a list of their employees whenever they make payments.

“When employers pay, they are supposed to send a list of beneficiaries as they pay to NSSF. But what we have observed over the years is that companies would pay without accompanying lists and funds cannot be allocated and it is put in the suspense accounts,” said Joseph Kirya, the Director of Audit in charge of Central Government.

He said that the issue has been severally brought to the attention of NSSF through management letters but continues to happen.

This followed a question from select committee chairperson, Mwine Mpaka regarding complaints over money kept on a suspense account. Amos Kankunda, the Rwampara County MP tasked the Auditor General to find out if NSSF has a system to safeguard funds in the suspense accounts.

Meanwhile, the Auditor General also revealed that a total of 323 million shillings plus USD 293,656 was spent by the Fund towards expenditure which could have been avoided with better planning. The 323 million was paid in the Lubowa real estate investment phase 1 to undertake procurement of contractors and yet the Fund has a fully-fledged procurement and disposal unit.

In addition, Akol said that the supervision consultancy contract provided for the participation of a consultant to provide technical expertise during the evaluation of bids. On the other hand, US Dollars 173,426 and US Dollars 120,230 was paid to contractors as compensation claims relating to the renewal of performance and advance guarantees as a result of delayed issuance of instructions for commencements.

The select committee learnt that the office of the Auditor General, on a rotational basis of three financial years hires international audit firms who carry out the audit. Some of the firms are PricewaterhouseCoopers (PWC), Ernst & Young, KPMG and Deloitte.

Steven Kateregga, the Assistant Auditor General in charge of Corporate Services said that they opt for private firms due to the limited staff they have. He told the select committee that they would require an additional budget of 50 billion Shillings to enable the Office of the Auditor General to recruit more staff and carry out the audits.

According to Kateregga, they have spent 240 million on PricewaterhouseCoopers (PWC) which currently has a contract of auditing NSSF. James Bantu, the Director of Audit –in charge of Forensic Investigations and IT Audits also explained that they opt for these international firms because NSSF also invests in property outside the country.

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