By Lwazi Dlamini
THE Financial Services Regulatory Authority (FSRA) has not been paying dividends or special dividends to the Government even after realizing total profits amounting to E41 million over five years.
This is reflected in the Public Accounts Committee (PAC) Recommendations on the Auditor General’s Financial Audit reports on Government accounts for the financial years ended on March 31, 2022, and 2023.
The report states that the FSRA, an integrated regulatory and supervisory authority for all non-bank financial service providers in Eswatini, had made total profits amounting to E41 359 718 over a five-year period.
“The Auditor General reported that the Financial Services Regulatory Authority (FSRA) which is operating in the regulatory and development category was not declaring and paying dividends or special dividends to the Government even though it was operating at full strength and realizing profits.
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The total profits realized by this public enterprise over a five-year period amounted to E41 359 718. Even though discretion for declaring dividends was left to the Board, the policy emphasizes that those entities operating at full strength and realizing significant profits must pay dividends or special dividends,” part of the report reads.
The controlling officer, through FSRA Chief Executive Officer (CEO) Ncamiso Ntshalintshali, submitted that when the parastatal was established, they were informed that they may start paying dividends once the organization is at full strength.
Ntshalintshali said, however, it was not clearly defined what exactly constitutes “full strength” and further stated that the parastatal must generate its own income even though the organizations of its nature are not profit-making by design.
He said talks are currently underway on how to move forward. The PAC has since recommended that the CEO, Ntshalintshali continue with the discussions and update the Honourable Committee and Auditor General on the way forward within three months after adoption of the report.
Another entity, Swazican Fruit Canners has not paid the Government her dividend for seven years.
“The Company has been declaring zero dividends from the year 2016 to 2023. Government’s investment is 5% shareholding which is equivalent to 600.348 shares,” part of the report reads.
The Controlling Officer admitted that the Ministry has engaged the company (Swazican Fruit Canners) and requested it to write and explain the reasons why they cannot pay the dividends instead of simply keeping quiet.
He disclosed that the government was also working on evaluating whether to sell its shares in some of these companies, which are not declaring dividends.
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The PAC has since recommended that the Controlling Officer continue to monitor the performance of the company and then submit an update on the decision regarding whether the Government intends to sell its shares or not,
to the Honourable Committee and the Auditor General within six months after the adoption of the report by the Honourable House.