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UEGCL saga: Muhakanizi audit blocked

Details of accusations against Isabalija emerge

In what appears to be a continuing standoff between the Secretary to Treasury (ST), Keith Muhakanizi and officials of the Uganda Electricity Generation Company Ltd (UEGCL), The Independent has learnt that Muhakanizi was apparently blocked from auditing UEGCL accounts.

The Independent has obtained a dossier revealing what exactly led Muhakanizi to direct an audit on the power generator.

Muhakanizi received the dossier on November 17 and on December 05 penned a letter to the UEGCL Chief Executive Officer (CEO), Harrison Mutikanga, informing him about his intentions to have the power generator audited.

“Stakeholders have raised various complaints about the mismanagement of UEGCL and based on the above Act (Public Finance Management Act 2015),” Muhakanizi noted, “I have nominated the following internal auditors to conduct a special audit into the operations of UEGCL for the last two financial years to ascertain the validity of the allegations made.”

Muhakanizi wanted the audit to kick off two days later from December 08 and to cover financial years 2014/15, 2015/16 and the period from 1st July 2016 to 31st December 2016.

Mutikanga replied a day later. In his letter, he noted that UEGCL was not a Vote but a body corporate incorporated under the Companies Act 2012 and receives funds by a subvention remitted by the Energy Ministry, which is the Vote.

“The audit should in our view be done through the Accounting Officer of the Vote to whom we have accounted for the funds received by subvention up to 30th September 2016,” Mutikanga’s letter reads in part, “The Accountability for the quarter ending 31st December 2016 is due at the end of the period. Additionally, we wish to inform you that the company has been audited by the Auditor General…for the financial years 2014 and 2015. Enclosed are copies of the Audit Reports for reference.”

On Dec. 19, Patrick Ocailap, who is Muhakanizi’s deputy, penned another letter to Mutikanga.

Ocailap noted that the Energy Ministry accounts to the Secretary to the Treasury. He also noted that Section 7(1) of the Public Enterprises Reform and Divestiture (PERD) Act, empowers the Finance Minister to exercise a strategic economic monitoring role in relation to public enterprises and liaise as necessary with the line Ministers in monitoring the performance of Public Enteprises and participating in the development and supervision of their operating plans.

He also noted that the PFMA mandates the ST to advise the Finance Minister on Economic, Budgetary and Financial matters. He also added that the same law also mandates the ST to ensure that the internal audit function of each vote and Public Corporation is appropriate to the needs of the voter or Public Corporation concerned and conforms to internationally recognised standards, in respect of its status and procedures.

“Given the above provision, it has become necessary for the Secretary to the Treasury to execute his role by sanctioning an audit to evaluate whether UEGCL Internal Audit has been effectively carrying out its mandate and reporting appropriately and whether the performance of UEGCL is in line with intended objectives to enable me report to the Minister and other Stakeholders,” Ocailap’s letter reads, “In light of the above, I wish to urge you to give unlimited access to my Internal Auditors to enable them accomplish this engagement as planned.”

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