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" A review of the terms and conditions of the performance agreement applicable standards and regulations, guidelines and documents as deemed necessary under the circumstances. " Examination of receipts and disbursement transactions from the project funds if complied with Loan Agreement, financial Regulations and other instructions or directives issued by respective authorities. " Review project financial statements, progress report, supervision report and any other information associated with implementation of the project. " Review of the system of awarding consultancy contracts and their execution. " Interview and discussion with some of the project staff and other key players in the implementation of the project. " Conducting Site visit on project operation areas to evaluate the progress and the status of implementation. " Hold the entrance and exit meetings with auditee to discuss the audit objectives and results of audit. 3.0 Audit Findings and Recommendations. 3.1 Follow Up of Previous Audit Recommendations. In our previous year's management audit report for the year ended 30th June, 2020 we had highlighted some areas of weaknesses and shortcomings. We had given four recommendations for improvements. During the current audit we observed that out of four recommendations given, one recommendations had been partially implemented and three was fully implemented as summarized below:- V ol-LER A1VQ4 ck 7 ZANZIBAIR Table 2: Previous Audit Recommendations No Issue Recommendation Status of Implementation 1. Lack of coding of We urge the Project management to Partial Implemented Movable Assets ensure that projects' movable assets are coded with identification mark for easy control and monitoring. 2. UN spent balance The management of the program is Fully Implemented USD 5,898,367.63 recommended to speed up the utilization of fund according to budgeted activities and time framed to enable the project to be completed on time. 3. None updating of Management of the Project should Not implemented asset register of immediately update the asset list for project movable and immovable assets clearly indicating their unique identification marks (serial number). 3.2 Current Year Audit Findings During the course of this audit we discovered some flaws on which we would like to bring to your attention. It is better to peruse our observations and recommendations, and finally we request your course of action you intend to pursue relating to these matters. 3.2.1 Financial Performance during the year The Project is 100% financed by IDA, therefore no funds from the government received to support this project. During the year under review, the project received fund from IDA 0 8 USD 13,182,489.08 against the budgeted amount of US$ 1, 5000,000 which is equivalent to 88% of the budget as depicted by the table below. Table 3: Sources of Fund during the Year SOURCES OF Budget Variance Variance FUNDS USDUD0/ Loan from IDA 15,000,000 13,182,489.08 1,817,510-92 12% Total 15,000,000 13,182,489.08 1,817,510.92 12% 3.2.2 Expenditure Performance During the year 2020/2021 the project spent a total of US$ 14,143,330.74 including the Opening balance of US$ 2,598,659.97 to finance its planned activities from the IDA funds. Table below show the details of expenditures during the financial year; Table 4: Expenditure Performance Description. Amount (USD) Opening balance 2,598,659.96 Fund received during the year: IDA 13,182,489.08 Government contribution 0 Total funds available during the year 15,781149.05 Total Expenditure for 2020/2021 14,143,330.74 Closing Balance 1,637,818.31 BOLLER ANDZ' * ANZIBAR *9 3.2.3 None implemented activities. During the year under review, our audit revealed that Mwantenga pond water drainage works could not be completed until the closure of project. This project would cost a total of TZS 1,736,773,216.56 and could help local residents to overcome the frequent flood problems especially during the rainy season. Implication. The flood problem will continue to affect residents of that area and the project objective is not achieved. Recommendation. The government should ensure that there is a good designing and close supervision for all projects in order to achieve its intended objectives Management response The original works at Mwantenga pond completed in April 2020. However, after the works had completed the area experienced some flood effects caused by excessive water coming from the upstream of the System C drainage. Hence, mitigation measures were 0 10 proposed which included carrying out additional works at Mwantenga ponds (A and B). Unfortunately, due to an impending closure of the project at the time when the addendum no. 7 was signed, the works at this section had to be cancelled as its implementation would have extended beyond the project closing date of 31st December 2020. Audit comment. Audit noted that and insists there should be a proper designing and supervision for government projects because the problem should have been solved from original works at Mwantenga pond completed in 2020 3.2.4 Failure to operate PCW system at Kibele landfill Our physical verification of Kibele landfill project, we found that the Planted Constructed Wetlands (PCW) system does not work properly due to pipe blockage that causes people not use this system, hence the objective of having this project that cost a total of Tzs 1,246,124,300 until its completion is not achieved. 11VI Implication. This problem will cause government to provide additional fund to solve it, the situation that could avoided if there was a proper designing and good supervision of this project. Recommendation. It is advisable for the government to be active in supervising its projects in order to achieve the intended goals and save the government fund that can be used to solve other problems. Management response The blockage of sludge feeding pipes of the PCW is the result of t non-compliance with the Operation and Maintenance (O&M) manual by the landfill operator. To guide the landfill operator during the operation phase, the project, through the consultant prepared a specific O&M with clear guidelines on how to operate and maintain the PCW. Unfortunately, the users did not operate the PCW according to the manual. The absence of qualified technical staffs with qualified skills is another reason leading to the pipe blockage as this was also indicated in the O&M. Audit Comments. This project spent a lot of money, it is a duty of government to make sure that it operates according to manual so as to avoid these kind of problems. Also skilled and technical staff are available to manage Kibele landfill. 3.2.4.1 Non installation of Mobile Composite Equipment for Kibele Landfill During our site visit at Kibele landfill, we noted that the President Office Finance and Planning procured a mobile compost equipment for Kibele landfill (agricultural tractor, composing turning machine, vacuum water tank trailer and mobile compost) screen at a cost of USD 420,580 form M/S Com.INT.S.p.A.Italy. However, these equipment were not installed despite the supplier being paid all his money including installation and training cost. B0TROLLER AV Implication. The value for money and objectives of that project cannot be achieved if these equipment are not installed and used according to requirement of the project. fBOLLER ID. 13 Z?-1t4gp Recommendation. We recommend that President Office Finance and Planning through ZUSP project to ensure that equipment are installed and work so that the objective of procuring these equipment can be achieved. Management response In line with the contract, the final payment to the supplier was made after delivery and acceptance of the equipment by end user. The acceptance letter for the delivered equipment was issued following a successful installation of the same; and after end user (technical staff of ZUMC) had received a two weeks trainings on how to operate and troubleshot the equipment from the supplier. . In addition, the end user confirmed in writing that all equipment is in good working conditions. Hence only then did PMT affected final payment to the supplier. The absence of enough technical staffs at Kibele landfill is a reason leading to the insufficient use of the equipment. Audit Comments. The compost equipment were delivered since February but till we finished our audit they were uninstalled and are not used for the intended activities. The government should make sure that the equipment are working so as to meet objective of the project 3.2.4.2 Non-use of Accounting Software (NAV) in Preparation of Accounting Information. Our audit noted that in the year 2019 President Office Finance and Planning entered into an agreement with M/S Core Soft Limited of Zanzibar to supply latest version of financial management system (NAV system) for the ZUSP project at a cost of USD 56,404. Apart from that fund ZUSP is required to M/S Core Soft Limited pay annual license fee every year. 14 BNZAR In spite of being paid license fees currently the system does not work as intended and accounting information is prepared using excel form. During the year the following payment were paid. Pvno. Chq No Amount Paid Payee Paid For PV/PBZ/F/20- TT 2,500.00 Core Soft Installation of 21/9/20 Limited Microsoft dynamics NAV web server and configuration of VPN PV/PBZ/F/20- TT 3,776.00 Payment of 21/8/30 OF core soft license of 27/8/20 limited accounting software Total 6,276 Implication. The objective of establishing this system has not been achieved. Recommendation. This system has been procured with a lot of money so it is the responsibility of the government through the ZUSP project to ensure that this system is used as intended. Management response This contract included supply and installation of a computer server, Microsoft Dynamics NAV software, annual license fee, training of users and implementation support. All the above requirements were met fully. iOL ER A A complete physical infrastructure of the system is installed at the IFMS, NAV system software in place; other security devices for VPN were installed. IFIMS technical staffs were trained to configure and give support for existing and additional staff. An annual license fee was provided too. Therefore, the system could be utilized in the future when the client finds necessary to make use of it. Audit Comment Since the project procured the system and the annual license fee is paid, it is a duty of PMT staff to use it in preparation of accounting and financial information 4.0 CONCLUSION The detailed audit findings presented above were communicated to management of ZUSP during the exit meeting held on 15 December, 2021 in which the issues raised were discussed and agreed upon. The management of the ZUSP has promised to take appropriate action with a view to rectify the situation. The Office of Controller and Auditor General appreciate to formally receive your response within an appropriate period from the date of receiving this report on the actions taken on the observations and recommendations contained therein. Lastly, we would like to express our appreciation to the management of ZUSP for the cooperation extended to the audit team. It is my hope that such good working relationship will be extended to us during our next audits. *2ANz~ 1- 16