Mozambique: IGEPE introducing management contracts for state-owned companies from 2018

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Mozambique: IGEPE introducing management contracts for state-owned companies from 2018

12:35 CAT | 22 Aug 2017

File photo / IGEPE headquaarters in Maputo

All managers of state-owned companies will from next year have a management contract governing their activities as part of measures to improve the level of commitment in the management of public assets.

The Annual Planning Meeting of the Institute for the Management of State Holdings (IGEPE) yesterday indicated that a performance matrix establishing goals and objectives to be achieved by administrators and the company as a whole would be introduced.

Financial managers and other management personnel, as well as commercial sectors, will have objectives and goals.

Raimundo Matule, executive director of IGEPE, explained that this management matrix would be the basis for the evaluation of performance of the company as a whole and of each member of the board of directors.

The meeting in Maputo also focused on the analysis of the restructuring of the companies in the IGEPE portfolio, currently a total of 99, 43 in operation and the rest in liquidation and dissolution.

It also reviewed the legal framework of the State’s corporate sector, reinforced supervisory and control mechanisms and increased capital revenues in the companies where the government has a shareholding.

As well as strengthening supervisory and control mechanisms, Matule explained that state-owned companies needed to consolidate accounts.

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“We also want to discuss the process of organising the company’s report and accounts. Companies are presenting reports and accounts outside the legally established period, which is the three months immediately following the close of the year,” Matule said.

Yesterday’s meeting was expected to help establish procedures to be observed in order for companies to comply with this legal provision.

Another focus was risk management. Matule explained that companies face several types of risk – commercial, business environment and, above all, tax.

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“State-owned companies that receive public resources must equip themselves with mechanisms to control fiscal risk in a way that does not burden the State Budget. We are going to talk about companies’ indebtedness and retrocession of state funds,” he explained.

Matule also argues that in order to comply with the intended objectives, companies must have a business plan establishing indicators, targets and performance goals.

“It turns out that many companies do not even have a business plan. We will discuss business plans as the basis for annual plans and budgets,” Matule said.

Source: Notícias