Mehta accounts kept secret for 26 yrs

By Mary Karugaba

THE accounts of the Sugar Corporation of Uganda (SCOUL), in which the Government has 51% shares, have not been checked by the Auditor General since the company’s establishment in 1980.

This is contrary to the Constitution, which requires the Auditor General to audit all companies where the Government is a majority shareholder.

Officials of the Ministry of Finance, appearing before the Public Accounts Committee in Parliament, also revealed that SCOUL has not been remitting dividends to the Government in 26 years, claiming the company has been making losses.

According to the 1980 joint venture agreement, the Government owns 51% in four companies owned by the Mehta Group: SCOUL, UGMA Steel and Engineering Limited, the Cable Corporation of Uganda as well as Tea Estates and Luwala Tea Estates.

“The practice has been that partners (the Government and Mehta) appoint their own auditors,” the finance commissioner for economic development policy and research, Tisasirana Longino, told the committee.

“In this case, the auditors were appointed by the board to carry out the auditing. However, we apologise that we didn’t come prepared for this query.”

Pressed to disclose how much money the Government has been getting from the companies, Tisasirana said: “The Government has not been getting money because they have been making loses.” He also claimed that the Government last year reduced its shares to 32%.

But the committee chairman, Nandala Mafabi, expressed surprise that the Auditor General had not been checking Mehta’s accounts since 1980.

“This is unacceptable. The law demands that the Auditor General audits all companies where the Government owns more than 50% shares. How come that he has never audited these accounts for all these years?” he asked. “This is our investment, how do you monitor our money when the Auditor General is not involved?”

Talking to The New Vision afterwards, Mafabi questioned whether the Government had reduced its shares. “Where is the evidence? As far as we are concerned, it is still 51%. How did it change?”

He suspected Mehta of having meddled with its accounts in order to avoid paying taxes. “Making losses for 26 years? That can’t be. I think Mehta has been falsifying their accounts. They don’t want to pay taxes.”

The committee ordered the Auditor General to audit the accounts of the Mehta Group for the last six financial years and report back “as quickly as possible.”

The MPs also want the Auditor General to audit the Speak Resort Munyonyo, where the Government paid sh8b to the build the Presidential Village.