EXCLUSIVE: Financial Queries, Divisions Rock Uganda Women Entrepreneurs Association

The prominent Uganda Women Entrepreneurs Association Limited (UWEAL), is facing turbulence over inefficiency and alleged misappropriation of funds by its top leadership.

The powerful association of female entrepreneurs was formed 30 years ago by Mama Mbire, the mother of wealthy businessman Charles Mbire.

ChimpReports has learned that a due diligence report by CR Amanya Advocates in 2018 recommended that the senior management should step down to allow for a “comprehensive forensic audit and investigations to be carried out in the Association.”

It was also resolved that members identify and appoint an interim steering committee to handle the affairs of the Association while investigations are being carried.

“There is an urgent need to ascertain the current financial standing of the association i.e. debtors and creditors and potential threats. This will help to understand the situation and allow the members to counter any adverse potential threats,” the report prepared on the instructions of UWEAL observed.

However, ChimpReports has learned that the forensic investigation was never carried out, sparking divisions and animosity in the 30-year-old group.

In the hot seat is the Chief Executive Officer Constance Kihembo.

Her management team is accused of lacking proper systems and policies some of which are “clearly grossly abused,” and absence of a financial sustainability structure that has led to over dependence on donor funds.

The top leadership is also blamed for the paralysis of the association upon wind up of the donor projects and lack of clarity regarding internally generated funds and diversion and misuse of association resources.

Members told ChimpReports the unfolding developments threaten to divide UWEAL membership.

UWEAL was established in 1987 by four visionary women in business as a membership based organization incorporated during that time when the idea of women in business was considered a taboo in Uganda.

They set out to change perception and set up in place platform to promote women in business in Uganda and network with other women in business globally.

The association is currently firmly placed in the private sector to assist and provide the necessary support and guidance to women in business and to advocate for favorable policies through which women entrepreneurs can flourish.

However, the prevailing unrest threatens to erode the gains realised in the last few decades.

In an email to UWEAL members on July 9, Kihembo sought to explain the unconfirmed income of Shs 150,290,111 in the 2017 draft financial statements but members are insisting on a forensic audit.

In the draft financial statements issued to management on February 9, 2018 and March 1, 2018, DATIVA & Associates CPA said the audit team was unable to confirm income totalling Shs 150,290,111 reported in the financial statements due to lack of supporting receipts.

It was further noted that unsupported receipts/ income accounts for 33.8% of the gross income were reported by management in the financial statements and as such they were unable to confirm the correctness of all income reported in the financial statements for the year ended December 31, 2017.

“Management engaged the auditors with relevant supporting documentation to the tune of Shs 111,945,441 leaving an unexplained variance of Shs 38, 344,670. This was acknowledged by the auditors and in their next draft of 10th March 2018, they justified their qualification of opinion by unconfirmed income of Shs 38,344,670 in the financial statements,” said Kihembo.

“In a subsequent meeting held at the auditors’ offices and attended by the CEO, the PSFU Director Finance and the Internal Auditor, this matter was discussed among others. It was resolved that all income included in the financial statements was actually confirmed by looking at the bank statements. It was further agreed that all funds reached UWEAL and evidence was availed on the bank statements. Management acknowledged that there was a weakness in receipt writing by management for the Nairobi TMEA e-transfers and the interest arising from the fixed deposits. The auditors acknowledged that UWEAL management had shared this information,” she added.

Nevertheless, an Annual General Assembly has been summoned to discuss this matter.

Members say Kihembo’s management has not put in place proper systems and policies, if any, they are clearly grossly abused.

Members further claim lack of transparency and communication between and amongst the board, the various committees and the association despite the fact that this is a membership organization.

A due diligence report also pointed out poor record keeping which makes it hard for members and stake holders to fast track vital information; failure to disseminate information not only to the members but also the board and the respective committees and dependence on projects and aid yet UWEAL is a self-sustaining organization.