KAMPALA – An audit review has uncovered a significant financial discrepancy in the government’s high-profile purchase of shares in M/s ROKO Construction Ltd, revealing an excess payment of UGX 117 million due to an error in communication from the Office of the Clerk to Parliament.
The issue stems from a resolution passed by the Parliament of Uganda on July 21, 2022, which authorized the Government to acquire 150,000 preference shares in the struggling construction giant at a cost of UGX 207.013 billion.
However, according to a detailed review of the transaction, the Clerk to Parliament, Mr. Adolf Mwesige, in his subsequent communication instructing the Ministry of Finance, Planning and Economic Development (MoFPED) to disburse the funds, erroneously wrote the amount as UGX 207.130 billion.
This simple clerical mistake, a difference of UGX 117,000,000, was not caught before the Ministry processed the payment. MoFPED, acting on the written instruction from Parliament, paid the inflated sum to ROKO Construction Ltd.
The transaction was formalized through a share subscription agreement signed between MoFPED, on behalf of the Government of Uganda, and ROKO Construction Ltd on July 28, 2022.
The audit review further highlights a critical lack of documentation to justify the government’s investment. Key records were missing, including:
· A valuation report supporting the UGX 207.013 billion price tag for the shares.
· A comprehensive due diligence report assessing the financial health and risks associated with investing in ROKO.
· A clear business case outlining the expected benefits for the government from this significant expenditure.
This overpayment raises serious questions about financial controls and verification processes between key government institutions. The lack of foundational documents also suggests the multi-billion shilling investment was approved without the necessary preparatory scrutiny, potentially exposing public funds to risk.
When reached for comment, officials from the Ministry of Finance and the Office of the Clerk to Parliament were yet to provide a statement on the findings or clarify if steps have been taken to recover the UGX 117 million overpayment.
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