THE National Youth Service (NYS) under the Ministry of Youth spent only half of the money allocated to it in the 2008/2009 financial year.
Of the N$110 million the government pumped into the service, only N$56 million was spent.
This creates the impression that the service is making a profit, instead of underspending its annual grant from the government.
In the financial year under review the youth service’s income was slightly more than N$1 million.
This has prompted the auditor general (AG) to observe in his report that the NYS cannot operate without government assistance.
According to the report, the annual financial statements have been prepared on the basis of accounting policies applicable to a going concern.
“This basis presumes that funds will be available to finance future operations and that the realisation of assets and settlement of liabilities, contingent obligations and commitments will occur in the ordinary course of business. The ability of the Service to continue as a going concern remains dependent on continued funding from the Ministry of Youth, National Service and Culture,” the report stated.
According to the AG’s report the institution received N$216 815 in donations, N$28 800 from the rental of tractors, N$734 102 from sales of farm produce and N$80 000 in dividends.
The AG also found that there is no proper internal control over the accounts payable and the NYS management also failed to provide the auditors with some of the supporting statements requested.
Some unpaid invoices for services rendered or goods received at year-end were not recorded in the books as accounts payable or accruals.
“The Service indicated that a substantial amount of payables outstanding is that the Service owes itself the amount of N$1 861 780 according to the age analysis provided,” read the report.
The auditors further found that a significant number of assets such as farm implements and equipment were allocated under cost of sales and that the construction of the Rietfontein buildings for about N$7,7 million was classified as repairs and maintenance and not as capitalised and disclosed assets.
The largest expenditure was for the payment of salaries, which amounted to N$14,4 million, while repairs and maintenance amounted to slightly more than N$14 million.
Expenditure on catering services amounted to N$6,7 million and N$9,2 million was spent on training.