Auditing Projects in Tanzania

The United Republic of Tanzania (hereinafter, referred to as ‘Tanzania’) is the largest country in East Africa and is one of the highest recipients of foreign aid from US, World Bank, UN Programs and European Nations. The level of foreign aid in Tanzania constitutes around 50% of the total budget of the nation for a year. Due to this fact, there are several projects working with this aid.

One of the important areas, in which the Tanzania is getting funds is for the ‘Climate Change programs’ and in particular the ‘REDD Projects’. I got an opportunity to audit some of these projects, and during audit I observed that in general, there are some problems like:-

Ø Insufficient capacity at each level, so the projects are dependent upon the foreign skilled professionals, leading to high cost of execution of activities;

Ø Lack of understanding of the project, resulting in insufficient budgeting and then over spending;

Ø Depreciation of currency and resulting risks;

Ø Lack of knowledge about the accounting standards, laws and regulations applicable to the agencies etc.

Ø Improper financial management systems.

Thus, when the funds are provided to such agencies, they fail to achieve the desired outputs and outcome for the project in stipulated time. Of course, the projects have an effect of wide spread corrupt practices due to poverty and low range salary structures particularly among the government officials. In short, the implementing agencies do intend to complete the activities and spend money budgeted for that, but are not much concerned for the achievement i.e. the Value for money concept.

As I pointed out earlier, there are problems with financial management of the projects and now, some of the donors (popularly termed as Development partners) have started providing such assistance to these projects, to reduce the risk of collapsing the projects. This would necessarily help the implementing agencies to execute the project activities in an effective way and to achieve their desired outcome in a timely manner.

In addition, various development partners have started providing technical expertise to these implementing agencies by their contacts with the professionals in the country. Further, the government itself has shown its willingness to remove such weaknesses however, it may take some time. Since, there is a political will; I hope the country will come up with improved systems.