1. MASERU CITY COUNCIL THE BASOTHO HAT

2. INTRODUCTION No country, however democratic, is free from corruption, this social ill touches government officials, politicians, business leaders & journalists alike. It destroys national economies, undermines social stability & erodes public trust (Combating crime – UNPAD 019187)

3. BACKGROUND Municipal council in Lesotho with 13 wards Established in 1989 Situated in Maseru Maseru is the capital of Lesotho, situated on a plateau in the extreme west of the country. There is an interesting colonial style in Maseru, of single-storey sandstone buildings; notable examples include the Cathedral and St John's Church(see pictures) The surviving buildings date from the late 19th century onwards and were constructed of dressed sandstone with thatched or corrugated iron roofs Maseru is Lesotho's only sizable city, with a population of approximately 227,880 (2006) The city was established as a police camp and assigned as the capital after the country became a British protectorate in 1869.British

4. BACKGROUND Cont…….. Cathedral St John’s

5. ORGANISATIONAL STRUCTURE Town Clerk Works Health Finance/ City Treasurer Administration ParksPlanning COUNCIL RevenueExpenditureStoresPurchasing

6. Financial Management System Cash resources & bank a/cs managed by CT CT: also entrusted with custody of council’s assets A consolidated FMS system in place; Sebata Municipal Financial Management System All receipts deposited with the bank the next day Reconciliations should be done on monthly basis

7. CASH RISK MANAGEMENT ANALYSIS AIM: Corruption not necessarily emanate from technical & sophisticated ways Negligence corruption/fraud Unfilled posts

8. Maseru Case Study Over a long time RA post remained vacant Certain duties & responsibilities definitely compromised Chief amongst: daily cashbook analysis, monthly bank reconciliation etc Cashiers siphoned municipal cash into their pockets Reported case of a cashier stealing council funds over a period of time Picked almost after a year/two In particular day she would be in short of R3000 & then after some time be in excess of the same amount This could not be picked instantly

9. Maseru Case Study Cot……. Some cheques drawn to the council were also cashed Evidence of collusion with the bank Further evidence of fraud & corruption in stores section Staff taking council consumables for personal use No proper record-keeping in stores

10. Learning experience Continuously perform bank reconciliations Cashbook analysis should be duly performed Officers should performed effectively their duties Strong internal controls Appointment of ethical personnel critical

11. CONCLUSION It is therefore critical that appointed officers perform their duties effectively and that continuous reporting mechanisms are put in place. Internal control systems have to be continuously monitored to ensure their effectiveness & possible improvement