THE REPUBLIC OF UGANDA

REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF

KYAMBOGO UNIVERSITY

FOR THE FINANCIAL YEAR ENDED 30TH JUNE 2015

OFFICE OF THE AUDITOR GENERAL

UGANDA

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TABLE OF CONTENTS

LIST OF ACRONYMS ............................................................................................................................ iii

REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF KYAMBOGO

UNIVERSITY FOR THE YEAR ENDED 30TH JUNE, 2015 ................................................................ iv

DETAILED REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF THE

KYAMBOGO UNIVERSITY FOR THE YEAR ENDED 30TH JUNE, 2015........................................... 0

1.0 INTRODUCTION ........................................................................................................................ 0

2.0 BACKGROUND INFORMATION................................................................................................ 0

3.0 ENTITY FINANCING ................................................................................................................. 0

4.0 OBJECTIVES OF THE UNIVERSITY ........................................................................................ 1

7.1 Categorization of Audit Findings ............................................................................................. 3

7.2 Summary of audit finding .................................................................................................... 3

LIST OF ACRONYMS

ACRONYM MEANING

FY Financial Year

ISA International Standards on Auditing

KYU Kyambogo University

MoESTS Ministry of Education, Technology Science and Sports

MOFPED Ministry of Finance, Planning & Economic Development

MoPS Ministry of Public service

NCHE National Council for Higher Education

NSSF National Social Security Fund

NTR Non Tax Revenue

OAG Office of The Auditor General

PAYE Pay As You Earn

PDE Procuring and Disposing Entity

PFMA Public Finance Management Act

PPDA Public Procurement and Disposal of Assets

TAI Tertiary Institutions Act, 2001

UGX Uganda Shilling

UNISE Uganda National Institute of Special Education

UPK Uganda Polytechnic Kyambogo

URA Uganda Revenue Authority

REPORT OF THE AUDITOR GENERAL ON

THE FINANCIAL STATEMENTS OF KYAMBOGO UNIVERSITY

FOR THE YEAR ENDED 30TH JUNE, 2015

THE RT. HON. SPEAKER OF PARLIAMENT

I have audited the financial statements of Kyambogo University for the year ended 30th June

2015. These financial statements comprise of the Statement of Financial Position, the

Statement of Financial Performance, and Cash flow Statement together with other

accompanying statements, notes and accounting policies.

Management Responsibility for the Financial statements

Under Article 164 of the Constitution of the Republic of Uganda 1995 (as amended) and

Section 45 of the Public Finance Management Act, 2015, the Accounting Officer is

accountable to Parliament for the funds and resources of the Kyambogo University. The

Accounting Officer is also responsible for the preparation of financial statements in

accordance with the requirements of the Public Finance Management Act 2015, and the

Financial Management Guidelines for Public Universities, 2009, and for such internal control

as management determines is necessary to enable the preparation of financial statements

that are free from material misstatement whether due to fraud or error.

Auditor’s Responsibility

My responsibility as required by Article 163 of the Constitution of the Republic of Uganda

1995 (as amended) and Sections 13 and 19 of the National Audit Act, 2008 is to audit and

express an opinion on these statements based on my audit. I conducted the audit in

accordance with International Standards on Auditing. Those standards require that I comply

with the ethical requirements and plan and perform the audit to obtain reasonable

assurance whether the financial statements are free from material misstatement.

An audit involves performing audit procedures to obtain evidence about the amounts and

disclosures in the financial statements as well as evidence supporting compliance with

relevant laws and regulations. The procedures selected depend on the Auditor’s judgment

including the assessment of risks of material misstatement of financial statements whether

due to fraud or error. In making those risk assessments, the Auditor considers internal

control relevant to the entity’s preparation and fair presentation of financial statements in

order to design audit procedures that are appropriate in the circumstances but not for

purposes of expressing an opinion on the effectiveness of the entity’s internal control. An

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audit also includes evaluating the appropriateness of accounting policies used and the

reasonableness of accounting estimates made by management as well as evaluating the

overall presentation of the financial statements. I believe that the audit evidence I have

obtained is sufficient and appropriate to provide a basis for my qualified opinion.

Part “A” of this report sets out my qualified opinion on the financial statements. Part “B”

which forms an integral part of this report presents in detail all the significant audit findings

made during the audit which have been brought to the attention of management and form

part of my Annual Report to Parliament.

PART “A”

Basis for Qualified Opinion

Unsupported adjustment of domestic arrears

The University management adjusted the audited balance of UGX.4,983,181,363 by

UGX.7,080,137,441 for domestic arrears through the statement of changes in reserves.

However, I was able to verify only UGX.4,638,629,950 leaving a balance

UGX.2,441,507,491 not supported with adequate documentation. I was also not availed

with the supporting documents for the newly accrued payables of UGX.8,855,923,344

during the year.

Unauthorized Excess expenditure

Review of the budget estimates and the actual expenditure revealed that a sum of

UGX.4,987,135,363 was incurred well above the budgeted expenditure without the

requisite approval of Council and other authorities.

The practice undermines the intentions of the authorities which approved the budget.

Opinion

Qualified Opinion

In my opinion, except for the possible effects of the matter described in the Basis for

Qualified Opinion paragraph, the financial statements present fairly in all material respects,

the financial position of the Kyambogo University for the year ended 30th June 2015 in all

material respects in accordance with the Financial Management Guidelines for Public

Universities, 2009, and Section 51(1) of the Public Finance Management Act, 2015.

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Emphasis of Matter

Without qualifying my opinion further, I draw your attention to the following matters

disclosed in notes 18 & 22 of the financial statements.

Management of Receivables

Contrary to the University fees policy and Examinations regulations I noted that the

University reported receivables of UGX.4,809,987,553 relating to student’s fees.

Failure to collect tuition cripples the University’s ability to implement planned activities

and impacts negatively on service delivery.

Accumulation of Payables

Contrary to the Government commitment control system which requires the Accounting

Officers to commit the entity to the extent of funds availability, payables amounting to

UGX.8,855,923,344 accrued during the year.

Failure to adhere to the commitment control system does not only violate the laid down

Government policies, but also exposes the University to the risks associated with delayed

settlement of suppliers, such as litigations with their attendant costs.

Other Matter

In addition to the matters raised above, I consider it necessary to communicate the

following matter other than those presented or disclosed in the financial statements.

Staffing Gaps

Review of the approved University staff establishment revealed that out of 1,556 posts,

only 837 (54 %) were filled leaving a gap of 723 (46 %) posts. Out of 537 required

academic staff, only 260 posts were filled, which was less than 50%. This implies that

the University does not have the requisite number of teaching staff, despite the fact that

teaching is its core activity. Inadequate staffing undermines the achievement of strategic

objectives and affects the level and quality of service delivery at the University.

Underfunding of University Capital Development budget

Review of capital budget performance for the last six financial years revealed that only

UGX. 16,063,057,000 cumulatively has been allocated for capital development by both

the central Government and the University through the annual budget allocations and

Non-tax revenue.

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This underfunding does not allow the University to develop adequate infrastructure to

cater for the increasing student population.

John F.S. Muwanga

AUDITOR GENERAL

21st December, 2015

PART "B"

DETAILED REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS

OF KYAMBOGO UNIVERSITY FOR THE YEAR ENDED 30TH JUNE, 2015

This Section outlines the detailed audit findings, management responses, and my

recommendations in respect thereof.

1.0 INTRODUCTION

Article 163 (3) of the Constitution of the Republic of Uganda, 1995 (as amended)

requires me to audit and report on the public accounts of Uganda and all public

offices including the courts, the central and local government administrations,

universities, and public institutions of the like nature and any public corporation or

other bodies or organizations established by an Act of Parliament. Accordingly, I

carried out the audit of the Kyambogo University to enable me report to Parliament.

2.0 BACKGROUND INFORMATION

Kyambogo University is a public University located 8 kms from Kampala City. It is

found in Kyambogo Parish, Nakawa Division, Kampala District. It was established by

the Universities and Other Tertiary Institutions Instrument No.37 of 2003. The

University was established out of a merger of three former institutions of ITEK, UPK

and UNISE. The University’s vision and mission statements are as stated below;

Vision: “To be a Centre of academic and professional Excellency”

Mission: “To advance and promote knowledge and development and skills,

technology and education and in such other fields having regard to quality equity

progress and transformation of society”

The University is unique in nature because of the different specialties drawn from the

three former institutions which are teacher education, engineering science; and

special needs education and rehabilitation.

3.0 ENTITY FINANCING

The University was financed by Grants from Central Government, Donor funds and

locally generated revenues. Grants totalling UGX 25,443,509,830 and UGX

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966,478,400 were received from Central Government and other Government units

respectively while Non-Tax Revenue collection was UGX. 44,662,899,671 for tuition

fees.

4.0 OBJECTIVES OF THE UNIVERSITY

The University’s strategic objectives include;

Foster excellence in education encompassing quality, skills development, breadth and

relevance of teaching and learning,

Promote research, innovation and knowledge generation,

Improve infrastructure and facilities in line with the University needs,

Strengthen the University’s institutional capacity, and

Improve the stature and image of the University.

The University’s specific objectives include;

To spearhead applied research.

To produce highly and practically skilled man power for service to society.

To strengthen and expand vocational studies.

To provide training for teachers and other personnel working in the field of special needs

education and rehabilitation, and to cater for all kinds of persons with disabilities and

special learning needs.

To equip graduates with the analytical tools required to solve problems utilizing their

scientific knowledge and appropriate technology.

To provide a resource center for the production and dissemination of information relating

to persons with disabilities and special learning needs.

To promote the acquisition, adaptation and application of information technology and to

solve economic and educational problems of Uganda.

5.0 AUDIT OBJECTIVES

The audit was carried out in accordance with International Standards on Auditing

and accordingly included a review of the accounting records and agreed procedures

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as was considered necessary. In conducting my reviews, special attention was paid

to establish:-

a) Whether the financial statements have been prepared in accordance with

consistently applied accounting policies and fairly present the revenues and

expenditures for the period and of the financial position as at the end of the period.

b) Whether all funds were utilized with due attention to economy and efficiency and

only for the purposes for which the funds were provided.

c) Whether goods and services financed have been procured in accordance with the

Government of Uganda Procurement regulations.

d) Whether the University had a sufficient internal control structure and the internal

controls were working as intended.

e) Whether the management complied with the Government of Uganda financial

regulations in their operations.

f) Whether all necessary supporting documents, records and accounts have been kept

in respect of all activities, and are in agreement with the financial statements

presented.

6.0 PROCEDURES PERFORMED

The following audit procedures were undertaken:-

(a) Revenue

Obtained schedules of all revenues collected and reconciled the amounts to the

cashbooks and bank statements.

(b) Expenditure

The payment vouchers were examined for proper authorization, eligibility and

budgetary provision, accountability and support documentation.

(c) Internal Control system

Reviewed the internal control system and its operations to establish whether

sound controls were applied throughout the period audited.

(d) Procurement

Reviewed the procurement of goods and services by the Ministry during the

period under review and reconciled with the approved procurement plan.

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(e) Fixed Asset Management

Reviewed the use and management of the Ministry assets during the period

under audit

(f) Financial Statements

Examined on a test basis, evidence supporting the amounts and disclosures in

the financial statements; assessed the accounting principles used and

significant estimates made by management; as well as evaluating the overall

financial statement presentation.

7.0 FINDINGS

7.1 Categorization of Audit Findings

The following system of profiling of the audit findings has been adopted to better

prioritise the implementation of audit recommendations.

N

o

Category Description

1 High significance Has a significant / material impact, has a high likelihood of

reoccurrence, and in the opinion of the Auditor General, it

requires urgent remedial action. It is a matter of high risk

or high stakeholder interest.

2 Moderate significance Has a moderate impact, has a likelihood of reoccurrence,

and in the opinion of the Auditor General, it requires

remedial action. It is a matter of medium risk or moderate

stakeholder interest.

3 Low significance Has a low impact, has a remote likelihood of reoccurrence,

and in the opinion of the Auditor General, may not require

much attention, though its remediation may add value to

the entity. It is a matter of low risk or low stakeholder

interest.

7.2 Summary of audit finding

No Finding Significance

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1. Unsupported adjustment of domestic arrears High

3. Unauthorized Excess expenditure High

4. Management of Receivables High

5. Accumulation of Payables High

6. Under funding of University Capital Development High

7. Staffing Gaps High

8. Mischarge of expenditure Moderate

9. Late delivery of Teaching materials Moderate

10. Failure to Appoint Contracts Managers Moderate

11. Lack of a Risk Management policy Moderate

12. Absence of IT steering committees Moderate

13. Failure to collect outstanding rental fees from private

businesses

Moderate

14. Grounded Vehicles Moderate

15 Follow up of prior year Audit recommendations Moderate

8.1 Unsupported adjustment of domestic arrears

The University management adjusted the audited balance of UGX.4,983,181,363 by

UGX.7,080,137,441 for domestic arrears through the statement of changes in

reserves. However, I was able to verify only UGX 4,638,629,950 leaving a balance

UGX.2,441,507,491 not supported with adequate documentation. I was also not

availed with the supporting documents for the newly accrued payables of

UGX.8,855,923,344 during the year.

In the absence of supporting documents I could not confirm the correctness of the

adjustments and accrued payables during the year.

There is a risk that fictious claims can creap through the system and they are paid as

domestic arrears.

There appears to be no systematic approach of compiling and documenting all the

payables at the end of the financial year.

I advised the Accounting Officer to put in place proper procedures of tracking and

recording all unpaid claims and invoices for their proper management and eventual

settlement.

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8.2 Unauthorized Excess expenditure

Paragraph 3.18 (5) of the Kyambogo University Management Manual 2014 states

that “The vote holder in consultation with the University Bursar, are responsible for

monitoring their expenditure to ensure that the budget limits of their Administrative

departments or Faculties are not exceeded and to initiate requests for virement,

reallocation and /or supplementary provisions when their budget limits are about to

be used up”.

Review of the budget estimates and the actual expenditure revealed that a sum of

UGX.4,987,135,363 was incurred well above the budgeted expenditure without the

requisite approval of the Council and other relevant authorities.

I explained to management that over expenditure on one budget item suffocates the

implementation of other planned activities. The practice also undermines the

intentions of the authorities which approved the budget.

In response management indicated that the excess expenditure was due to

inadequate budgeting. The expenditures were particularly on teaching and learning

budget, arising from pressures to settle domestic arrears for this category of

expenditure.

I have advised the Accounting Officer to always budget properly and avoid

overspending by obtaining appropriate authority and adjusting the budgets where

expenditure is expected to exceed the initial budgeted amounts.

8.3 Management of Receivables

The University fees policy and Examinations regulations require that for any student

to sit for University exams, he/she must have fully paid up all tuition and functional

fees and duly registered with the University. Strict implementation of the policy

would mean that no debtors would arise from unpaid fees. I noted however, that the

University reported receivables of UGX.4,809,987,553 relating to student’s

fees.According to Note 18 to the Financial statements, UGX.3,482,873,320 has been

outstanding for more than one year.

I explained to management that failure to collect tuition fees cripples the University’s

ability to implement planned activities and impacts negatively on servive delivery.

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In response management explained that there was a reduction in the receivables

accrued during the year compared to the previous years. They attributed this to the

operationalization of the financial manual and introduction of revenue collection

system E-kampus.

I advised management to collect the outstanding receivables and also implement the

University fees policy with the aim of ensuring that all students pay their tuition fees

before sitting for the university exams.

8.4 Accumulation of Payables

Contrary to the Government commitment control system which requires the

Accounting Officers to commit the Government entities to the extent of funds

availability, payables amounting to UGX.8,855,923,344 accrued during the year as

shown in the table below;

ITEM New outstanding

Commitments

Incurred during

the Year

Cumulative Outstanding

commitments 30 June 2015

Employee costs 4,915,927,602 8,802,292,578

Goods and Services

Consumed

3,939,995,742 4,830,873,682

8,855,923,344 13,633,166,260

With the current level of revenues collected by the University, It is highly unlikely

that the payables will be settled in the near future.

I explained to management that failure to adhere to the commitment control system

does not only violate the laid down Government policies, but also exposes the

University to the risks of litigations with their associated costs and also to the

possibility of industrial/labour strikes by unpaid staff members.

Management attributed the increase in payables to mandatory expenditures due to

the nature of the University operations whereby some activities are implemented

across the financial years, uneven cash flows as result of delayed students’ fees

payments and spill over effect of students’ and staff unrest in the previous financial

year.

I advised the accounting officer to adhere to the Government Policy and ensure that

commitments are only allowed to the extent of the available funds.

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8.5 Under funding of University Capital Development budget

Review of the University budget performance report revealed that the University has

been grossly underfunded in terms of capital development over the last six year.

Analysis of capital budget performance for the six financial years revealed that for

these years, only UGX 16,060,057,000 has been allocated for capital development by

both the central Government and the University through the annual budget

allocations and Non-tax revenue respectively as shown in the table below;( figures in

thousands).

Financial Year

GoU Contributi

on to Capital

Developm

ent

NTR Contribution

to capital Development

Total Total %ge

of GoU Releas

es

Total %ge of NTR

Collection

2009/10 222,844 702,080 924,924 1.2 2.3

2010/11 167,133 2,077,838 2,244,971 0.7 5.7

2011/12 167,134 2,434,018 2,601,152 0.9 6.2

2012/13 167,138 5,066,687 5,233,824 0.8 11.6

2013/14 222,845 2,329,506 2,552,351 0.9 5.1

2014/15 55,711 2,450,124 2,502,835 0.2 5.5

Total 1,002,805 15,060,253 16,060,057

I noted that the increasing student population has increased form 19,600 in 2013/14

to the current 25,000 in 2015/16. The small capital budget cannot permit

development of adequate infrastructure to match the increasing student numbers but

instead puts pressure on the old inadequate infrastructure. NCHE recommends on

average 2.5m2 per student of classroom space which does not seem to be available

given the current level of infrastructure development.

It was noted that most of that most of the houses (staff and others) are roofed with

asbestos sheets, which have been outlawed and banned.

Management acknowledged the gross underfunding on capital development and

indicated that the issue had been raised in various reports but no increments have

been considered by the Government. They also indicated that the University

management was in constant consultation with Ministry of Education, Science, and

Technology & Sports to review this trend.

I advised management to pursue the matter of funding with MoFPED and MoESTS

with a view of ensuring that adequate capital development funds are provided to

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enable the University undertake infrastructure development to cater for the

increasing student population.

8.6 Staffing Gaps

Review of the approved University staff establishment revealed that out of 1,556

posts, only 837 (54 %) were filled leaving a gap of 723 (46 %) posts. Out of 537

required academic staff, only 260 posts were filled, which was less than 50%. This

implies that the University does not have the requisite number of teaching staff,

despite the fact that teaching is the core activity. Most affected positions were those

above lecturer position, implying that the University is facing challenges of

supervising academic work at a senior level which impacts negatively on the

University’s research initiatives. The low number of teaching staff is also contrary to

the recommended numbers by NCHE.

The recommended ratios by NCHE are as follows;

Details Ideal Good Acceptable

General 1:15 1:2 1:25

Arts and Social Sciences 1:15 1:25 1:30

Other Proffesions,Law, Education etc. 1:15 1:20 1:25

Science based Professions 1:10 1:15 1:20

The low numbers of PHD and Masters holders is also contrary to the recommended

levels by NCHE which should be as follows;

Details Ideal Good Acceptable

Ph.D Holders 60% of staff 50% of staff 15-50% of staff

Masters Holders 70% of staff 60% of staff 50% of staff

Contact hours for academic

staff

10hrs/week 15hrs/week 20hrs/week

I explained to management that inadequate staffing undermines the achievement of

strategic objectives and affects the level and quality of service delivery at the

University.

In response, Management explained that the University did not have funds to recruit

staff and that for the last three (3) years; the University has not attracted Professors

and Associate Professors. As a strategy, the University had resorted to grooming its

own Professors and Associate Professors through Promotions, Training and Research

whereby 110 academic staff had enrolled for PhD and 41 had graduated. They

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further indicated that the University had also written to the Ministry of Public Service

to solicit for enhancement of the wage bill to enable it recruit additional staff in the

coming financial years.

I await the outcome of management efforts in addressing the staffing gap.

8.7 Mischarge of expenditure

The University uses the Government of Uganda Chart of accounts, which defines the

nature of expenditure for each item code. It is intended to facilitate better and

consistent classification of financial transactions and also track budget performance

per item in line with the approved budget. During budgeting, funds are tagged to

particular activities and outputs using account codes and are appropriated as

accordingly.

I noted however, that during budget implementation payments amounting

UGX.146,286,272 were charged on budget items meant for other activities. I

explained to management that the practice impacts on the credibility of the financial

statement balances since they do not reflect the true amounts expended on the

respective activities. It also undermines the budgeting process.

The Accounting Officer explained that the mischarges arose from payment of

committee sitting allowances whose budget had been exhausted. I advised him to

ensure adequate and proper budgeting process to cater for all activities

appropriately.

8.8 Late delivery of Teaching materials

During the financial year under review, the University entered into contracts with

various service providers for supply of teaching materials intended for practical

lectures and other teaching guides with specified delivery schedules of one to two

weeks. I noted however, that teaching materials worth UGX.91,790,778 were

delivered two months after placement of the supply orders and the materials could

not be used for the intended purpose during the semester.

In response management attributed the delays to a number of issues such as late

initiation of procurements hence forcing PDU to set short delivery periods which were

not practical, the nature of the requirements for some Departments i.e. Human

nutrition & Home Economics, Agriculture and Art & Industrial Design required

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complex, unique, assorted items like rats and others which were not readily available

on the market.

I advised the Accounting Officer to streamline the procurement processes of teaching

materials to ensure that user departments initiate procurements in time.

8.9 Failure to Appoint Contracts Managers

A sample of 28 procurements worth UGX.1,955,176,369 were reviewed and it was

noted that contract managers were not appointed contrary to Reg.52. (1) of the

PPDA (contract regulations) 2014 which requires the user departments to nominate

to the accounting officer, a member of the user department, with appropriate skills

and experience, or who is supervised by a member of the user department who has

the appropriate skills and experience, to be appointed as contract manager .

In other cases where contract managers were appointed, there was no evidence of

implementation plans and contract management reports being filed.I explained to

management that failure to appoint contract managers violates the PPDA laws and in

their absence and contract management records, I could not confirm whether

supervision and monitoring of the contracts were adequately undertaken and in

accordance with the terms of the contract agreements.

In response management explained that contract managers were being appointed

for only works related procurements and that in future contract managers will be

appointed for all contracts and train all users in contract management.

I await the outcome of management’s commitment and actions.

8.10 Lack of a Risk Management policy

Risk assessment is the Identification and analysis of likely risks that an entity is

exposed to and can affect achievement of objectives. This informs the

steps/measures that can be taken to mitigate such risks. This is also a requirement

under the principles of corporate Governance 2014.

I noted however that the University management does not have an approved risk

management policy. I explained to management that failure to put in place a

comprehensive risk management policy exposes the University to resort to reactive

other than proactive responses to risks and there is a possibility that in case of any

unexpected events happening, the University may not be able to mitigate their

effects.

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In response, management indicated the development of risk management policy is

under process.

I advised Management to put in place a risk management policy that should provide

for analysis of risks and adoption of appropriate mitigation measures to address the

risks.

8.11 Absence of IT steering committees

KYU ICT policy Sec 6(2) states that Research, Innovations and Business Development

(RIBD) section shall be responsible for the development and review of ICT policies

and strategies for the University. The successful implementation of the ICT strategy

requires a well-focused coordination and University will need to utilize the ICT

steering committee to oversee the implementation of the strategy.

I noted that the University has not formed the steering committee to oversee

investments in ICT at the University. I explained to management that uncoordinated

ICT investments could lead to acquisition of ICT to investments that are not properly

aligned to the University’s business processes.

In response management explained that the Directorate of ICT was approved by the

University Council in November 2015 and that the structure that caters for the ICT

Steering Committee was part of the approval.

I advised the Accounting Officer to expedite the formation of the IT steering

committee so as to ensure that the investments in IT are strategically guided.

8.12 Failure to collect outstanding rental fees from private businesses

The University hired out spaces to various private business operators from which

rent is collected. At the close of the year, unpaid rental fees had accumulated to

UGX. 44,907,670 covering a number of years but there was no evidence that the

University had made efforts to recover the outstanding rental dues and the figure is

not included in the receivables for the year.

I advised the Accounting Officer to institute mechanisms to recover all outstanding

rental dues and in future consider putting in place controls to prevent accumulation

of unpaid rental dues.

8.13 Forgeries of examination cards

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The University fees policy and Examinations regulations require that for any student

to sit for University exams, he/she must have fully paid up all tuition and functional

fees and duly registered with the University. A student who satisfies the above

condition is cleared and given a green card to sit examinations.

Details from the Academic registrar’s office showed that a number of students were

involved in forgeries of Examination Registration cards during Semester 1 and II of

2014/15 Examinations. Management acknowledged that some students had

managed to manipulate the system to sit exams and some were even able to

graduate without clearing the University fees.

I explained to management that those forgeries are a result of weak internal controls

surrounding the fees collection and examinations management.

Management regretted the anomaly and explained that a number of policies and

guidelines on student fees collections, registration and management of examinations

had been put in place. The University had also extensively invested in automation of

business processes (e-kampus payment systems) to facilitate efficient fees

collections, students’ registrations and results management. Management stated that

it will further strengthen the registration process for examinations management by

investing in barcode readers and staff capacity development.

I await the outcome of management’s actions towards improving the controls in fees

collection and examination management.

8.14 Grounded Vehicles

Statutory Instruments 2014 No. 13, Regulation 2(1) of the PPDA Regulations 2014,

provides that for purposes of disposal planning, an accounting Officer shall, in each

financial year, cause the public assets of a PDE to be reviewed to identify the public

assets to be disposed of in the following financial year.

A review of a report obtained from the University Estates office indicated that a

number of assets including grounded vehicles were in bad condition with no plans by

the University to have these assets boarded of. There is a risk of further

deterioration in the scrap value of the assets if no immediate action is taken to board

them off.

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In response, the Accounting Officer stated that the vehicles in bad condition belong

to the MoESTS, and that he had written to the Ministry to obtain authority to either

dispose them off or to have them taken by MoESTS.

I advised the Accounting Officer to follow up this matter with MoESTS and Ministry of

Works to have the vehicles disposed of.

8.15 Follow up of prior year Audit recommendations

A review of the previous year audit issues and recommendations was carried out and

it was noted that management has not implemented the recommendations as per

details in the table below;

Audit Issue Current Status

Verification remarks

Misstatements in the Financial

Statements

Not addressed Financial statements were

corrected and submitted to

OAG for review.

Lack of budget provisions for

domestic arrears - UGX.959,827,755

Not Addressed Addressed in FY2015/16

BUDGET were UGX 3 billion was

provided for domestic arrears.

Failure to adhere to the Commitment

Control System

Not Addressed Not addressed as FY 2014/15

Accounts indicate over

commitment and payables.

Management of Receivables Not Addressed Partially addressed by settling

UGX; 1,251,270,988 leaving a

balance of UGX 47,078,093.

Failure to collect Revenue from staff

rentals – UGX.180,966,472

Not Addressed Partially addressed by UGX

2,113,884 not recovered.

Failure to collect outstanding rental

fees from private businesses -

UGX.42,457,276

Not Addressed Partially addressed with UGX

2,857,835 outstanding by feb

2015 (mukab general supplies

620,000 Kyala & brothers

1,621,000, twin general

enterprises 4553,320, NCHE

1,331,015).

Unpaid Hall Fees - UGX.62,560,000 Not Addressed Addressed fully

Non-collection of rent from

businesses operating illegally in the

University

Not Addressed Partially addressed:

Pending chief government

valuer to value rentable spaces

in the university.

Banks operating in the University

premises without paying rent and/or

valid contracts

Not Addressed Partially addressed. With ECO

BANK which was still consulting

its headquarters in west Africa.

Revenue from the University Farm:

Outstanding credit sales to

departments – UGX.15,571,150

Unauthorized Over Expenditure –

Not Addressed Partially addressed. Recurrence

of the same observation in

2014/15 final account.

14

UGX.5,135,749,119

Mischarge of expenditure – UGX.

978,727,963

Not Addressed Partially addressed. Recurrence

of the same observation in

2014/15 final account.

Unexplained deductions -

UGX.239,465,087

Not Addressed Addressed.

Extra Load Allowance -

UGX.40,145,000

Not Addressed Not Addressed.

It’s hard to address the

situation as the staffing is not

improved.

Doubtful Payment of Teaching

Allowance - UGX.17,957,500

Not Addressed Partially addressed

Un-presented Payment Vouchers –

UGX.504,161,513

Not Addressed Fully addressed

Advances not accounted for -

UGX.66,335,791

Not Addressed Partially addressed with

UGX.10,273,000 not recovered.

But plans to recover from

individuals are underway.

Non-remittance of taxes to URA -

UGX.382,901,835

Not Addressed To be addressed in FY2015/16

budget.

Not addressed

Undeducted NSSF –

UGX.315,232,550

Not Addressed Addressed

Undetailed Procurement work plan Not Addressed Addressed

Child To Child Project Not Addressed Addressed

Staffing gaps Not Addressed Not addressed.

Failure to record land in the Fixed

Assets Register

Not Addressed Addressed

Failure to transfer land titles into the

names of Kyambogo University

Not Addressed Under process of transfer.

Unabated Land Encroachment Not Addressed Partially addressed.

Un-demarcated University Land Not Addressed Under negotiation with

Buganda kingdom.

Dilapidated East end Kitchen

(Mandela Hall

Not Addressed Not addressed;

At level of Request for

quotations. Work is to be

undertaken this financial year

2015/16.UGX 250milion for

renovation in 2015/16 budget.

Non-functioning CCTV cameras Not Addressed Not addressed: Repairs

Provided in FY2015/16 BUDGET

Failure to install proper burglar

proofing at the East End Dining

stores

Not Addressed Addressed

Broken water pipes and dilapidated

Lavatory facilities in Halls of

residences

Not Addressed Addressed

Failure to dispose grounded vehicles Not Addressed Not addressed.

15

In addition, the University has continued to attract qualified audit opinions over a

number of years. Many of the bases of the qualified opinions required management to

cause investigations into the actions of the responsible staff and take action, while

others indicated systemic challenges that required council decisions to review the

operations of certain departments such as finance, procurement and internal audit.

This has not been the case.

In July 2014, I issued a special investigations report on the operations of the

University. However, there is no evidence that the University council and management

have taken any actions on my recommendations there in.

The accumulation on unresolved audit issues and recommendation could be an

indication that management and council do not appreciate the importance of the audit

recommendations and unwillingness to improve for better results.

I advised management of the University to review all the Auditor General’s reports for

the last five to seven years and implement the recommendations therein to enhance

accountability and better stewardship of the University resources.

16

FINANCIAL STATEMENTS