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Zifa debt rises to $8 million

There is no end to the financial crisis at the cash-strapped Zimbabwe Football Association (Zifa) as it has emerged that the association’s debt has ballooned to $8 million from $6 million within three years despite promises and claims by the Philip Chiyangwa-led executive that they had tackled the issue.

By XOLISANI NCUBE

A report from the external auditors, Baker Tilly Chartered Accountants, for the year 2017, which set to be tabled at today’s elective congress, indicates that liabilities of the association had increased from $5 944 656 in 2016 to $8 123 391 by December 31, 2017.

“We draw attention to the fact that at 31 December 2017, the association incurred a consolidated loss of $8 123 391 and that the group’s total liabilities exceed its assets by $ 7 940 053,” read part of the audit report.

A check of previous audit reports suggests that in 2015, Zifa’s liabilities stood at $5 089 754 and had, by December 31 2016, grown to $5 944 656.
In the 2016 financial audit report, the association had total liabilities exceeding total assets by $5 944 656 and this did not include a$1,2 million loan Zifa got from the Postal and Telecommunications Regulatory Authority of Zimbabwe.

But now, the financial report suggests that Zifa was not settling the loan while the interest continued to accrue although the association was banking on government taking over the entire debt.

The loan has an interest rate of 5% and $225 000 was due by September 2017 while the $1 million was due by January 31, 2019.

But to date, no cent has been paid back of the money borrowed to fund the 2017 Africa Cup of Nations senior men’s national team qualification campaign.

In the year 2017, Zifa according to the audit report, received more than $2 million from various players including, Fifa grants ($805 117), TV rights $19 500 and registration $202 770 among others.

Government, according to the report, only gave Zifa $900 and the association pocketed a total of $274 572 from gate takings from all matches in 2017.
Of that revenue, foreign travel alone by the Chiyangwa-led administration used $379 314, and employment costs $257 538, a decline from $327 708 used in 2016.

To their credit, the Chiyangwa administration in 2017 increased allocation to women football from $131 346 to $425 294.

When Chiyangwa took over the presidency in 2015 he stated that he would deal with the debt. In April, he told state media that he had cleared off debt and that only $2 million was outstanding, but the audit report indicates otherwise.

“The Zifa I have now is different from the one that I inherited; I have managed to pay off all the banks. Our debt is now around $2 million and we are working hard to ensure that we settle everything that we owe,” Chiyangwa was quoted in April.

But the audit report indicates otherwise.

Also, Zifa owes Conduit Holdings, a company linked to board member for finance Philemon Machana $ 22 00, former president Cuthbert Dube $ 918 049, and statutory bodies such as NSSA $48 890 up from $46 066 for 2016.

On ex-workers, Zifa owes former CEO Jonathan Mashingaidze, $116 744. He won his arbitration case and was awaiting confirmation of the award. The auditors in 2016 had opined that Mashingaidze would lose his case or that the amount would be reduced to $85 338,81.

But the ex-Zifa boss went on to get the award.

Zifa also owes its former lawyer Maganga $95 000 although the association was alleging that it owed him $30 000 only. The matter was by December 31, 2017 yet to be finalised.

In 2018, the association lost a labour case against former Mighty Warriors coach Shadreck Mlauzi for $187 290 and the auditors stated that
This comes as Chiyangwa, through his investment vehicle Kilima Investment, and those linked to him, had reportedly pocketed $139 500 by December 31 2016 and in 2017 paid 151 127 for accommodation and meals.

From that $139 500, $72 000 was paid to Kilima Investment, a company owned by Chiyangwa, for rentals for the year 2017 and a similar amount would be paid for 2018.

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