The Sports and Recreation Commission yesterday set a good example for the various national associations that are under their wings when they received a clean report from an auditing firm at their annual meeting held in Harare yesterday.
A presentation made by Rockstone Chartered Accountants to the delegates at the AGM revealed that the sport regulator's books of accounts for the year ended December 31, 2023 represented a true and fair picture of the organisation's finances.
The audit was contained in a 56-page annual report that was distributed to the delegates from the various National Sports Associations as well as invited stakeholders, who included the Ministry of Sport, Recreation, Arts and Culture, and some Government agencies.
"We have audited the accompanying financial statements of Sports and Recreation Commission, set out on pages 8 to 27, which comprise the statement of financial position as at 31 December 2023, the statement of profit or loss and other comprehensive income, statement of changes in reserves and statement of cash flows for the year then ended, and the notes to the financial statements, which include a summary of significant accounting policies and other explanatory notes," read part of the statement from the auditors.
"In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Sports and Recreation Commission as at 31 December 2023 and its financial performance and cash flows for the year then ended by International Financial Reporting Standards (IFRSS).
"We conducted our audit by International Standards on Auditing (ISAs).
"Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report . . . We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion." Sports Commission director-general Eltah Nengomasha said the financial and operating results for 2023 presented a significant improvement from the previous year, with most indices recording substantial growth.
"This performance was underpinned by our consistent focus on four strategic pillars for 2023 namely:
Revenue generation to improve the organisation's income position and complement the government grant.
Restructuring of the SRC balance sheet by revaluing assets namely, Gweru property, and disposing of obsolete assets.
Establishing operational efficiencies that resulted in the efficient and effective utilisation of resources.
Increase stakeholder engagement mostly with delivery agents and national sporting associations for improved sectoral performance in terms of compliance, participation, and podium performance."
However, just like any other organisation operating in Zimbabwe, they encountered substantial challenges due to the disparities created by the fluctuating exchange rates before the introduction of the ZIG currency.
The Sports Commission nonetheless managed to sail through because of the organisation's increased ability to generate funds outside the government grant, as they were able to service their obligations and close the year with a surplus and a positive cash flow balance.
"A notable change was on the SRC's profitability which increased by 41 percent to close at ZWL835 264 277 in 2023 from a closing balance of ZWL593 956 112 in 2022," said Nengomasha.
"Total income increased by 83 percent from ZWL5 058 993 627 in 2022 to ZWL9 247 325 113 in 2023. Government funding increased by 56 percent, the major contributor to the increase in total income was SRC's ability to generate alternative sources of revenue.
"Revenue generation increased by 252 percent from ZWL 697 259 732 in 2022 to ZWL2 456 236 639 in 2023." The Sports Commission also experienced an increase in expenditure and were at the same time able to extinguish their legacy debt.
"Total expenditure for the year increased by 89 percent from ZWL4 455 037 515 recorded in the prior year to ZWL8 412 060.
"The increase in operational costs were attributed to a 115 percent increase in funding towards sport and recreation development programs as there was an improvement in the organisation's programming and monitoring of sporting activities nationwide.
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"The general improvement in staff welfare initiatives by management can also be attributed to the increase in expenditure for the year 2023. SRC also managed to service significant legacy debt in the same period.
"There was a deliberate restructuring of business systems and operations particularly, the remodelling of procurement and finance processes to tighten controls, and to effectively utilise SRC's financial resources. The SRC managed to service legacy debt whilst being liquid to fund daily operations," said Nengomasha. It is hoped that the Commission's ability to maintain a clean audit will have a rub-on effect on the national associations that they supervise.
The SRC, to their credit, have been strict with associations on compliance issues as part of efforts to ensure there is better corporate governance at the different organisations tasked with administering the various sports codes.
