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Auditor-General Mrs Mildred Chiri (left) addresses the Institute of Chartered Accountants of Zimbabwe workshop on Bridging the Gap: Auditing in the Public Sector yesterday

Conrad Mwanawashe : Business Reporter

GOVERNMENT has raised the red flag over high fees auditors are charging for inspecting State-owned companies’ books, the Comptroller and Auditor-General Mrs Mildred Chiri said. Addressing the Institute of Chartered Accountants of Zimbabwe workshop yesterday, Mrs Chiri said most parastatals were choking under audit fees while auditors were smiling all the way to the bank.“I think there is need to moderate this area taking into account the state of the economy. Most of them (State-owned companies) said the fees were too high and they were struggling to pay. We have also noticed the disparity in the level of fees proposed when tenders are opened,” said Mrs Chiri.

“It does not mean that we are encouraging you to charge fees which are too low because once you quote a fee and to change it is difficult because it has to go through the State Procurement Board. So you charge a fee which will enable you to make a reasonable profit. You are not going to cut corners because the fee is low or you charged just to secure the audit.”

The ICAZ workshop ran under the theme “Bridging the Gap: Auditing in the Public Sector”.

Mrs Chiri was giving a report back on issues relating to subcontracted audits covering quality of work, knowledge gap about the public sector and what private sector auditors need to do going forward.

She said the area of audit fees is a matter of concern to Government and called on auditors to exercise “sobriety and moderation in charging fees as clients are struggling to pay because of the harsh economic situation”.

“This is an area where we are having challenges because some of the clients actually accuse us of giving them expensive auditors which they cannot afford. And in some cases, especially now when it comes to forensic audits, which I know are very expensive by their nature because as auditors you also need to cover your backs.

“If they involve litigation you may have to appear in court. You need to gather foolproof evidence which can stand in court but at times the fees are just too high,” said Mrs Chiri.

Some of the observations of the chief Government auditor included the sudden increase in the demand for forensic audits in almost all parastatals especially when there is a change of board members. This, she said, is choking most of the parastatals because once a tender has been floated and adjudicated, it will not be possible to wriggle out of that contract.

“New board members say we want to start on a clean slate. We (Auditor-General’s office) do comply and float a tender for the forensic audit when we have done the adjudication and we announce the winner. But when they see the fees, some have come back to us to say they cannot afford the forensic audit. When we do a cost benefit analysis it shows that they are actually losing.

“I do not think we can continue like that. I think we should look into the fees aspect. It’s an area of concern especially when Government is struggling to make ends meet,” said Mrs Chiri.

On her office’s capacity to carry out its mandate, Mrs Chiri said plans are underway to set up more units such as the forensic department and establishment of regional offices. But funding constraints were hampering the plans.