MPs on the Public Accounts Committee (PAC) have quizzed officials from Makerere University over the Shs11Bn arrear claims that was rejected by Ernst & Young, an auditing firm that was hired by Ministry of Finance to audit arrears fronted by public entities.
The team from Makerere University had been summoned to respond to audit queries raised in the December 2019 auditor general’s report.
The University team led by Yusuf Kiranda, the Acting University Secretary and Everest Bainomugisha, the University Bursar decried the recurrent arrears that keep on popping up because of disagreement between the University and Ministry of Finance.
They told the Committee that following a circular by the Ministry of Finance to audit all domestic arrears of public entities, a report by Ernst & Young rejected claims to a tune of Shs11bn out of the Shs22bn that had been fronted by Makerere University.
The University officials told the Committee that the arrears arose from claims by teaching staff who failed to provide to the auditors documentary evidence to back up their claims that they indeed stepped into lecturer rooms to teach their students.
“These were domestic arrears rejected by Ernst and Young of Shs11Bn. Some of these claims come from staff and when Ernst & Young came, they wanted supervision reports like invitation letters they want letters of supervisors, when they aren’t there, they reject. Yes, we are the ones who record but for us we know these are genuine claims from staff the only challenge is that there are no sufficient documents attached,” Bainomugisha said.
Nandala Mafabi, Chairperson PAC asked: “So why should Ernst & Young an outsider come and say this staff never taught yet you are the one who records?”
The Acting University Secretary Kiranda replied saying the expectation by Ernst & Young required those making claims to attach a detailed schedule of hours taught, daily registration sheet, marked sheet yet the University simply paid up claims by part time lecturers as long as it was endorsed by both the head of department and the college principal.
“That was sufficient indicator that indeed someone had offered the services. That is the lesson we picked, since the audit of Ernst & Young we have now changed the processes of recording teaching by part time staff, they have to register daily, they have to submit daily schedule of lessons taught. This audit process was also pointing us to gaps we had,” explained Kiranda.
It should be recalled that the Ministry of Finance contracted Ernst & Young to audit arrears of June 2017-June 2019 to a tune of Shs2.1Trn for verification as submitted by public entities after suspicions were raised on the skyrocketing increase.
The report by Ernst & Young revealed that domestic arrears to a tune of Shs400bn had no evidence of their existence like delivery notes and contracts.
The Makerere University officials were also quizzed on hiding Shs131.040Bn from various research projects, contrary to the Public Finance Management Act 2015 that requires such funds to be sent to the consolidated fund before expenditure at source.
The auditors also accused Makerere University of collecting revenue to a tune of Shs2.729Bn and USD696,784 from short courses and rental income but didn’t remit funds to the consolidated Fund.
The University officials were also questioned on the Shs23.9bn outstanding pension arrears with the University informing Parliament of plans to table a supplementary budget to settle the arrears.
The audit report also faulted Makerere University for deducting over Shs22.108bn from staff as well as goods and services without remitting the funds to Uganda Revenue Authority and National Social Security Fund.
