NWR insolvent: Auditor General

WINDHOEK – Namibia Wildlife Resorts (NWR) is technically insolvent and depends on the support of its shareholder – Government – and banks to continue its activities.

According to an Auditor General’s Opinion in the country’s 2009-10 Medium-Term Expenditure Framework (MTEF), the Ministry of Environment and Tourism expects a net profit from the company during the 2009-10 financial year.The last audited financial report ending March 2007 was qualified because of liabilities in the annual financial statements reflecting amounts of more than N$5,9 million for suspense accounts, more than N$4 million for advance bookings and more than N$5,7 million for leave pay provision. However, the auditors said there was no reliable system of control available to the external auditors for these accounts. ‘The auditors emphasised that as the company’s total liabilities exceeded its total assets by N$65 million, the company was rendered technically insolvent, and thus depended on the support of its shareholder and bankers to continue its activities,’ it read.The data is based on the audited report ending March 2007.However, the financial statements for the financial year ended March 2008 are not available yet.In its Profit and Loss or Income and Expenditure Account for the year ended March 31 2005, the company reported a loss of more than N$12 million, while for the same period ended 2006, NWR had recorded another loss of N$13,2 million.In 2007, another loss of N$14,7 million was recorded. Total equity and liabilities had jumped from N$18,3 million in 2005 to N$63,2 million in 2007. Government support for NWR has been achieved through recapitalisation on a government loan guarantee to implement a turnaround strategy and business plan and thus improve infrastructure and service. According to the ministerial targets in the MTEF, NWR should complete the implementation of the business plan and turnaround strategy approved by Cabinet in 2006 to ensure that the company achieves profitability and improves management, services and infrastructure. These activities will hopefully lead to an increase of tourists and visitors to Namibia from 928 912 in 2007 to 1,1 million in 2010-11, and also an increase in tourism levies and registration fees from N$12 million in 2007 to N$20 million in 2010-11.The vision of NWR under the leadership of its Managing Director Tobie Aupindi is to become the provider of a reliable, welcoming and appealing tourism service in the prime tourism destinations of Namibia, a mission to turn the company from a loss-making to a profit-making enterprise, and to achieve their vision within three years.With a Government guarantee of N$120 million, the company’s key resorts including Okaukuejo, Halali, Namutoni, Waterberg and Terrace Bay were all upgraded. NWR opened its first lodge since Independence, the Sossus Dune Lodge, and then the Onkoshi Camp in the Etosha National Park.During July last year, NWR entered into multimillion-dollar public-private partnership agreements with several local entities, mostly black economic empowerment (BEE) companies, which are opportunities to develop and manage some of its assets. These contracts are on lease for 50 years, 30 years, 20 years and 10 years. – Nampa