A new Auditor General report has uncovered misclassified multibillion-pula transactions linked to BCL and Tautona Lodge
GAZETTE REPORTER
Fresh revelations in a newly released Government Annual Statements of Accounts have exposed serious gaps in government bookkeeping, with high-value transactions linked to BCL and Tautona Lodge failing to properly reflect in official records.
In a qualified audit opinion, Auditor General Keneilwe Senyarelo flagged multiple inconsistencies, raising concerns over transparency, accountability and the integrity of government financial reporting.
BILLION-PULA INVESTMENT CLASSIFICATION QUESTIONED
At the centre of the findings is a P2.27 billion figure recorded as investments from Special Funds, which the Auditor General says is misstated. The report reveals that P900.5 million paid to the liquidator of BCL was incorrectly classified as an investment.
“There is no evidence for this as an investment as stated in my report for financial years ended 31 March 2020, 2021 and 2022,” Senyarelo said.
The audit further exposes unclear and potentially irregular transactions linked to BCL, including P211.9 million paid as an advance for liquidation expenses without clear repayment terms.
The report notes the funds were issued “for which there are no clear repayment terms,” raising concerns about recoverability and financial controls.
MISSING STATE-OWNED ENTITIES RAISE RED FLAGS
In another major concern, Tautona Lodge (Pty) Ltd—valued at P58.4 million—was completely omitted from the government’s Statement of Assets Held in Commercial Undertakings, despite being wholly owned by the state.
Also missing from the same statement was Debt Participation Capital Funding Limited, pointing to gaps in the reporting of government-owned entities.
“The following commercial undertakings wholly owned by Government were omitted from the statement,” the report states, listing Tautona Lodge and other entities.
WEAK DOCUMENTATION IN SPECIAL FUNDS MANAGEMENT
Further weaknesses were identified in the management of special funds. The Debt Participation Special Fund, with a balance of P9.1 million, could not be verified due to missing documentation.
“Most documents were not availed for audit,” Senyarelo said.
The audit also flagged P885.5 million in advance accounts, including P673.5 million linked to the purchase of De Beers shares, which has yet to be properly recorded in an appropriate account despite payment having been made.
CASH MANAGEMENT PRESSURES HIGHLIGHTED
Beyond misstatements and omissions, the report draws attention to government cash management challenges. As at March 2023, the Government Investment Account recorded a credit balance of P15.28 billion, resulting in a net overdraft position of P14.23 billion.
While the Auditor General did not modify the audit opinion on this matter, she stressed its significance.
“Given the magnitude of the amount involved, the matter is significant in the context of Government cash management and treasury operations.”
CONCERNS OVER FINANCIAL CONTROLS
Under Botswana law, the Accountant General is responsible for ensuring that financial statements are properly prepared and free from material misstatements. However, the audit underscores weaknesses in internal controls and financial oversight.
Senyarelo warned that misstatements can arise from fraud or error and are considered material if they could influence economic decision-making by users of the financial statements.