A new audit by the Office of the Federal Auditor General (OFAG) has exposed serious financial management breaches at the Ministry of Finance, including the collection of over 15.1 billion birr in revenues not recorded in the government’s 2023/24 approved budget.
According to the report, led by Auditor General Meseret Damte, the Ministry collected substantial funds outside the official budget framework—an act that violates Financial Governance Proclamation No. 648/2001, which requires all expected revenues to be reflected in the annual budget to ensure parliamentary oversight. OFAG warned that such practices threaten transparency and weaken accountability in public finance.
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The audit also highlights a long-standing problem of unsettled historical debts tied to the privatization of former state-owned enterprises. Outstanding debts exceed 3.09 billion birr, including 2.88 billion birr in unpaid balances from the sale of eleven privatized institutions—five of which represent “dead debts” dormant for more than ten years.
Additional red flags include:
- 2.35 billion birr in delayed payments pending for five to ten years
- Unpaid dividends, including 70.1 million birr owed by Guinness Overseas Holdings
- A 44.4 million birr loan to Ethiopian Business Works Corporation outstanding for over a decade
OFAG further reported 6.3 million birr in chronic shortages across 29 budget institutions, with the Customs Commission branch at Addis Ababa Airport showing a steep, tenfold rise in shortages—signaling worsening control weaknesses.
The audit also identified over 8 billion birr in inconsistencies between Treasury bill transaction reports and the government’s consolidated accounts, raising concerns about the reliability of public debt records.
Compounding these issues is a persistent failure by various federal bodies to register donor-funded grants within the IBEX system, undermining the completeness of government financial statements and hampering external audit verification.
OFAG cautioned that unless the government undertakes sweeping reforms to strengthen oversight, settle long-neglected debts, and enforce compliance with financial management laws, the integrity of Ethiopia’s public finances will remain at serious risk.
Source: Capital Ethiopia & Read original news here
