via Kanyekanye denies prejudicing Allied Timbers | The Herald January 3, 2014
ALLIED Timbers Holdings Limited chief executive Dr Joseph Kanyekanye has denied any financial impropriety in the running of the State-owned plantation development, timber and pole-processing enterprise.
This follows a report in The Herald Business of January 1, 2013 that the company’s board of directors had been dissolved after an audit allegedly unearthed serious financial impropriety feared to have prejudiced the firm of millions of US dollars.
Dr Kanyekanye said the board was neither dissolved nor fired, but that directors whose term of office was due to expire this month had received notices of the impending expiry of their tenure.
“Put simply, Allied Timbers has a full board with some but not all directors having been given notice of the impending expiry of their terms of office. It is thus clearly not correct to state that the board has been fired or dissolved,” he said.
He dismissed allegations that Government had instituted a forensic audit through the Comptroller and Auditor-General, but that the company was only carrying out a routine stock take in all subsidiaries.
“Being a state-owned private limited company, the Comptroller and Auditor-General are involved in the annual audits, external audit meetings and end of year external audit closure meetings,” he said.
Dr Kanyekanye said the audit of the company by BDO Zimbabwe was commissioned by the company’s board with the Comptroller and Auditor-General supervising the process through the Tender Board.
“The exercise looked at the group procurement system, corporate governance, use of silviculture contracts and the viability of the contract milling.
“There were no serious anomalies found, but the report confirmed the viability of contract milling models used by the group with the 70:30 systems being the most profitable,” said Dr Kanyekanye.
He said the group was not in financial dire straits and as one of the three biggest timber companies in Zimbabwe, posted a US$14,5 million profit in 2012 up from US$1 424 443 in 2011.
Commenting on an alleged trip to a subsidiary, Allied Timbers Botswana, for the purposes of destroying evidence about alleged shady deals with sister companies, he said that trip involved himself as the CEO and external auditors of the group; and its objectives were clear and the auditors approved it.
“It is standard practice after an audit that management addresses letters to management by auditors.
“The second meeting in Botswana was about restructuring the group,” said Dr Kanyekanye.
On the allegations of siphoning funds, he said the amount of CD1s outstanding was US$2,4 million representing amounts due to Allied Timbers Zimbabwe from Botswana, partly tied up in stocks and debtors.
The Allied Timbers chief refuted allegations of nepotism and cited the BDO audit as confirmation of that.
He also dismissed allegations that he lined up deals for Pace Consultancy, a firm linked to fellow board member, a Mr Rungano, during his time as chairman of both Rainbow Tourism Group and Capital Bank.
Dr Kanyekanye said allegations about flouting tender regulations were incorrect since BDO Zimbabwe assessed all the operational contracts in terms of process, ownership and related parties.
He said the audit established no conflict of interest and that there was no single case of preferential treatment or flouting internal procedures in awarding tenders including to a company owned by his young brother, Mr Chenjerai Kanyekanye.
“The preoccupation with Mr Chenjerai Kanyekanye and TS Timbers is unfortunate. He has been in the timber industry with other companies, his interest in TS Timber was dully disclosed to the board as a related party and the BDO report showed no favouritism or conflict of interest in his dealings with ATZ,” he said.
The Allied Timbers boss said it was not true that the firm disbursed US$47 000 to clear duty for a consignment of goods belonging to his wife, saying the company only paid US$2 750 for engines it bought in China.
“The supplier consolidated ATZ engines with that of other customers represented by Patience Maruni.
“There is no evidence of duty payment of Zimra. Mrs Kanyekanye did not have any association with this.
“Mrs Maruni has volunteered to furnish the documents and is prepared to be interviewed,” he said.