Auditor-General issues disclaimer as Gweru council books omit schools and assets

Auditor-General issues disclaimer as Gweru council books omit schools and assets

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The Auditor-General has issued a disclaimer opinion on Gweru City Council’s financial statements after finding that key records were incomplete and, in some areas, could not be verified, including council-run schools, bank reconciliations and major infrastructure assets.

The findings are contained in the Auditor-General’s Report for the year ending 31 December 2025 on Local Authorities, which was released to the public and presented to Parliament in June 2026. The report focuses on weaknesses linked to the city’s 2024 financial management and governance.

Auditor-General Vimbai Chikwenhere said the audit team could not obtain sufficient appropriate evidence to determine whether the financial statements fairly presented the council’s financial position, resulting in the disclaimer opinion.

One of the major findings was that the council’s four schools were not included in the city’s financial statements.

“The Council did not recognise the revenue, expenses, liabilities and assets for its four (4) schools in the financial statements,” Chikwenhere said.

The report said the omission weakened oversight and increased risks including possible misuse of funds and undetected fraud, while also reducing accountability and transparency and contributing to misstatements in the financial statements. Council management told auditors it intended to incorporate the schools into consolidated financial statements.

The audit also raised concerns about the city’s ability to account for high-value public infrastructure. Chikwenhere reported that Gweru City Council did not maintain a comprehensive asset register and did not value or account for infrastructure such as road networks, bridges and sewer reticulation systems.

“The Council did not maintain an asset register to support its property, plant and equipment balance… In addition, the Council’s infrastructure assets such as road networks, sewer reticulation systems and bridges were not valued and accounted for as part of property, plant and equipment,” the report stated.

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Council attributed the weaknesses to limitations in its Enterprise Resource Planning (ERP) system and told auditors it intended to procure a new system by 31 December 2026, followed by an inventory and valuation exercise for infrastructure assets. The Auditor-General noted that similar concerns had been raised in previous audits.

On cash management, the Auditor-General found the council’s records could not be properly reconciled with bank accounts. The report cited an unexplained ZiG89 million difference between the cashbook and bank balances, and another ZiG167.69 million discrepancy between cash records and the general ledger. The report warned that without regular bank reconciliations, errors or fraudulent transactions may go undetected.

The audit also pointed to a ZiG1.29 billion suspense account, which the report linked to poor accounting records. “The Council did not maintain adequate records and was not practicing the principle of double entry,” the Auditor-General noted.

Land and inventory records were also flagged. The report said repossessed commercial stands were not recognised as current assets or inventory, while a negative inventory balance of ZiG2.62 billion appeared in council records against a positive ZiG23.81 million reported in the financial statements, leaving an unexplained variance of ZiG2.64 billion.

Chikwenhere further reported weaknesses in revenue and debtor records, including an unexplained ZiG43.98 million difference after the council failed to reconcile customer debts. The Auditor-General also questioned ZiG99.44 million in journal entries which were unsupported by documentation.

The report also said council investments in Gweru City Parking Management Company (Private) Limited and Upenyu Breweries trading as Go Beer (Private) Limited were not accounted for in the financial statements, despite international accounting standards requiring such investments to be recognised.

Employee benefits were also affected by poor record-keeping, with the Auditor-General noting a ZiG54.23 million discrepancy in employee leave provisions after leave records failed to reconcile with amounts reflected in the financial statements.

In reviewing progress on earlier recommendations, the Auditor-General said the council made limited headway. Of 15 findings from the preceding audit, only three were addressed, while 12 remained outstanding, including the absence of an asset register, failure to account for infrastructure assets, failure to perform bank reconciliations and unreconciled receivables and payables.

Although the audit focuses on Gweru in Midlands province, the findings mirror recurrent themes in Zimbabwe local authorities’ audits which communities in Mashonaland Central follow closely, particularly where councils are responsible for roads, sewer services, waste management and land administration.

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