BNSC chokes in financial Deficit
Calistus Kolantsho | Monday February 1, 2021 15:14
Auditors, Grant Thornton submitted a financial report for thee year ended March 2020 to the BNSC painting a negative picture about the state of affairs at the sports body..The auditors said without qualifying their report, the Commission has an accumulated deficit amounting to P 90,982,383 and a net current liability position of P 1, 752 895 as of March 31 2020.
“The continued deterioration of the net equity position and a perennial precarious net liquidity position of the Commission raise a concern of the ability of the Commission to continue as a going concern. In addition, the COVID-19 Pandemic has affected cultural and sporting events across the world and it is expected that the effect of this pandemic will be felt by the Commission in the years 2020-2021 and 2021-2022. The ability of the Commission to continue is dependent on the continuous support of the government of Botswana in supplementing the financial needs through revenue and capital subventions,” the report reads.
The report further said the Commission is exposed to credit risk on debt instruments at fair value through other comprehensive income, trade and other receivables, lease receivables, cash and cash equivalents, loan commitments, and financial guarantees.
“The Commission is exposed to liquidity risk, which is the risk that the Commission will encounter difficulties in meeting its obligations as they become due. The Commission manages its liquidity risk by effectively managing its working capital, capital expenditure and cash flows. The financing requirements are met through a mixture of cash generated from operations and long and short term borrowings. Committed borrowing facilities are available for meeting liquidity requirements and deposits are held at central banking institutions,” the report further reads. Meanwhile, the Commission is looking for an external auditor following the expiry of its three contract with Grant Thornton Chartered Accountants.
The Commission has advertised for the three year contract tender commencing finacial year April 2020/2021 to 2022/2023. BNSC caretaker chief executive officer (CEO), Tuelo Serufho told Sport Monitor that the practice is to change auditors every three years. He explained that the practice is meant to avoid any relationship between the client and the auditor whigh might be perceived to be professionally compromising such as conniving between the two parties.