Officials from Uganda Broadcasting Corporation (UBC) have been quizzed on the non-remittances to National Social Security Fund (NSSF) which have accumulated to Ugx 11.5 billion.
UBC officials led by the now Acting Managing Director Nkezza Ayello had appeared before Parliament’s Committee on Commission Statutory Authorities and State Enterprises chaired by Kyadondo East MP Ibrahim Ssemujju Nganda to answer audit queries for the year ended 31st December 2011.
The committee learnt from the acting Accountant at UBC John Patrick Kataba that the non-remitted fees to NSSF currently stand at Ugx 11.5billion of which Ugx 2.5billion is principal, Ugx 1billion interest and Ugx 9billion as penalty.
The Auditor General, in his report for the year under review noted that the corporation had failed to remit Ugx 489billion to NSSF which was an amount of 15% due to the Fund out of 5% staff contribution and 10% Employer’s contributions from staff salaries and wages.
The Auditor General noted that this exhibited an increasing laxity in adhering to statutory requirements and expressed worry that failure to remit UBC’s NSSF contributions would result into diversion of funds to other use and risks of deprivation of retirement benefits when employees retire.
John Patrick Kataba, the Acting Accountant at UBC, noted that no remittances had been effected ever since the audit query hence the amount accumulating to Ugx 11.5billion currently.
Kataba noted that the current management at UBC has made attempts to meet NSSF and that very soon they will be coming up with a payment plan to pay the outstanding arrears.
Paul Kihika, the former Managing Director at UBC confirmed that during his tenure he used to deduct the money from staff but never remitted it to NSSF saying that the money was not always there but that they also inherited arrears of Ugx 2billion from 2006 and that there were arrangements with NSSF to pay the money in installments.
However committee chair Ssemujju Ibrahim Nganda requested for evidence in terms of proof of correspondences between UBC with NSSF on remittances.
Meanwhile, UBC officials were also grilled over unaccounted for VAT amounting to Ugx 1.5billion.
The Auditor General noted that UBC charged and collected from its client 18% on receipts but while recording into the ledgers the net amounts were recorded and consequently the VAT amounts were not recorded in the corporation records and the VAT collected not remitted to URA.
The Auditor General said that as a result, VAT invoices amounting to Ugx 1.5billion remained unaccounted for and that he did not obtain evidence that UBC was a VAT registered collector.
In his audit report, the Auditor General cited a risk that the funds collected as VAT were not used for the intended purposes.
Kataba John Patrick the Acting Accountant UBC said that the VAT has now been reduced to 834million as a result of payment and that UBC management is still in negotiations with URA to come up with a payment plan of the balance.