| FINANCE  |

FINANCE DEPARTMENT

The Food Reserve Agency’s Finance department consists of 28 staff members headed by the Finance Manager.

The department is responsible for all the day to day administration of all financial matters for the Agency.  This includes the tracking of all transactions and the management of all financial reporting which in this case extends right through to preparation of financial statements with external auditors engaged for assurance purposes.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Functions

  • Management of the organization’s cash flows.
  • Advising management and sourcing longer term financing.
  • Contributes to the management and improvement of the operations.
  • Preparation of management accounts
  • Preparation of budgets and forecasts.
  • Provides information for key strategic decision-making.

Financing model 

The Food Reserve Act provides for the funding of the Agency’s operations through the following sources

  • Grants as maybe appropriated by Parliament for purposes of administering the national food reserve.
  • Funds paid to the Agency by way of fees, grants or donations and
  • Such funds as may vest in or accrue to the Agency subject to approval of the Minister.
  • Income from investments of such funds as the Agency does not immediately require for the performance of its functions.
  • Income from leasing of storage facilities.
  • Accept money’s by way of Grants or donations from any source and raised by way of loans or otherwise such moneys as it may require for the discharge of its functions. Such borrowings shall require approval of the board and the Ministry of Finance.

 

 

 

 

 

 

 

 

 

 

 

 

Accountability and Prudent management of resources

The Government of the Republic of Zambia made a decision in 2013 that the operations of the Agency shall be fully financed by Government grants as appropriated by Parliament. In view of the foregoing, the Agency is subject to regular audits by the Office of the Auditor General and external auditors who carry out the mandatory statutory audits.

The Agency has recorded tremendous improvements in the management of financial resources and accountability as evidenced by the reduction in queries raised by the Office of the Auditor General as can be seen in the table below;

Office of the auditor General Audits

Year 2009- 2011 2012 – 2014
Number of queries 21 6

Wealth distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Food Reserve Agency engages various financial institutions to pay small scale farmers, providers of services and goods countrywide for crops purchased through its annual crop marketing exercise. Below is a list of the institutions contracted;

  • Zambia National commercial Bank
  • Finance Bank Zambia
  • Investrust Bank Zambia
  • Zambia Postal Services
  • National Credit and Savings Bank
  • Stanbic Bank Zambia
  • Standard Chartered Bank Zambia
  • Barclays Bank Zambia
  • Indo Zambia Bank
  • Cavmont Bank Zambia
  • Ecobank Zambia
  • Zambia National Building Society
  • Banc ABC

 

Services offered 

Payment of small scale farmers

The Agency pays farmers through appointed financial institutions in various locations. During the 2016 marketing season 76,286 farmers countywide were paid for crops supplied. In order to decongest pay points and process farmer’s payments quicker, the FRA introduced the following measures:

  1. Zoned satellite depots; districts have been divided into geographical zones or grouping of satellite depots for purposes of enhancing speedy payment to farmers. Zones will be assigned specific pay points and days during each week;

 

  1. FRA pays farmers cash over the counter;

 

  • FRA has ensured that more than one banking institutions are enlisted for payment of farmers to minimize congestion;
  1. FRA Head Office remits funds directly to paying banks based on the quantities of crop purchased.

 

  1. In order to be paid, a farmer will produce the following documents to the designated financial institution:
  • Original Produce Receipt and Certification Note (PRCN)
  • National Registration Card (NRC)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contributing to the National Treasury

 

The Agency has been contributing to the Government treasury over the years through proceeds realized from the sale of designated commodities as highlighted in the table below.

The Agency has further contributed to the national foreign exchange reserves through proceeds realized from the export of crop to neighboring nations.

 

YEAR 2013 2014 2015 2016
K’000 K’000 K’000 K’000
CONTRIBUTION 532,347 604,958 1,221,300 1,347,500

Using Information and Communication Technologies (I.C.T.s) to improve efficiencies and accountability

The Finance department has engaged financial institutions in collaboration with mobile service providers to pay wages using their payment platforms.

Banc ABC Visa cards

  • Casual workers are provided with Visa debit card
  • The wage bills are verified and audited
  • Funds are transferred directly to the debit cards
  • The workers can then draw funds from any Visa enabled Automated teller machine (ATM).

Mobile money platform

  • Mobile money accounts are opened for the workers
  • The wage bills are verified and audited
  • Funds are remitted to the participating bank electronically
  • The bank transfers funds to workers Airtel money accounts
  • The workers can then draw funds from any Airtel money agent

 

 

 

 

 

 

 

 

 

Advantages

  • Reduced risk of misappropriation through handling of cash
  • Structured and formalized audit trail
  • Increased in accountability of public funds
  • Encourages the culture of savings