Auditor General queries Farmers World loan

via Auditor General queries Farmers World loan – The Zimbabwe Independent January 16, 2015

THE Ministry of Agriculture, Mechanisation and Irrigation Development failed to account for payment of almost US$12 million made for farming equipment supplier, Farmers World, an audit report has revealed.

In the Report of the Auditor- General for the Financial Year ended December 2013, Auditor General Mildred Chiri said she was concerned by the ministry’s failure to account for the payment.

“I was concerned by the ministry’s failure to disclose Public Financial Assets amounting to US$11 833 443 in Farmer’s World,” Chiri said in her report. “Furthermore I could not confirm the occurrence, rights obligations and existence of the government’s stake as I was not provided with loan agreement forms for my audit examination.”

In its response the ministry said it did not enter into any agreement to provide a Treasury guarantee on behalf of Farmers World to borrow funds from China Exim-bank for the purchase of farm machinery, and only paid the amount to maintain diplomatic relations with China.

“The ministry did not enter into agreement nor did it seek any Treasury guarantee on behalf of Farmers World to borrow funds from China Exim-bank for the procurement of farm machinery the ministry,” said in its response. “Treasury paid on behalf of Farmers World in order to maintain diplomatic relations.

“The ministry was advised to capture the expenditure in its books as the items bought by Farmers’ World related to agriculture and Government of Zimbabwe guaranteed the transaction”

The ministry said the farm equipment supplier is not under the direct control of the ministry, but had engaged the Finance ministry to guide them on how the transaction can be introduced in the ministry’s books.