Nauga asking NRI to recoup K307,000 from former director

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The former director of the National Research Institute (NRI) received more than K307,000 in motor vehicle allowances in 2015 and then resigned, according to the Auditor-General’s Report.
Auditor-General Philip Nauga has advised the NRI to recoup the advance and underpayment of tax from the former director before he received his final entitlement.
“My review of the pre-payment account revealed that in 2015, the institute paid K109,000 to Boroko Motors to purchase the director’s motor vehicle.
“(This was) with the arrangement that the said amount needed to be repaid over four years using the director’s motor vehicle allowance.
“On Oct 28, 2015, the director again encashed an amount of K198,379 as vehicle allowance advance to be repaid over the same period.”
Nauga noted the follow discrepancies in relation to the payment:
l Salaries and Remuneration Commission (SRC) Determination G007-General Provisions stipulated that the vehicle allowance advance can be paid to the supplier of the vehicle and not directly to the recipient. This NRI had not adhered to this provision;
l The amount encashed by the director was subject to normal salary and wages tax treatment. A review of the director’s payroll records revealed that the fortnightly deduction of K2879.35, being motor vehicle allowance, was not included in the calculation of tax; and
l At the time of the audit the then director had resigned without fully paying the advance.
“As a result, I was unable to comment on whether the arrangements made were proper and transparent, and whether the institute will be able to recoup the remaining balance from the former director,” Nauga said.
“I recommended the institute to cease such practice of paying cash advances to officers without following proper procedures.
“I further advised the institute that the underpayment of tax and outstanding advance from the director should be recouped before final entitlement is paid.”
Nauga also observed:

  • Bank reconciliations were not done on a timely basis;
  • The National Research Institute council met four times in 2016 but meeting minutes were not signed;
  • Chairman and community representative members of the council had their terms expired in 2010 but no new appointments were made;
  • Lack of proper maintenance of personnel files;
  • Weaknesses in internal control; and,
  • Journals were not maintained.