Despite the challenges posed by the onset of the COVID-19 pandemic in late 2019, the Botswana Public Employees Union (BOPEU) has soldiered on and remained solvent in the mist of declining revenue streams.
According to the Treasurer General’s report 2019/2020 & Audited Financial Statements (2019/2020), the BOPEU Group assessed available information regarding the pandemic and how it would impact its members and business operations.
“The Group has used endeavours using the currently available information to assess the possible impact that this will have on its activities over the short-term and possibly the long term,” reads the audited financial statements. “In doing so, it has determined that key drivers of financial performance which are likely to be materially impacted positively as a result of the COVID-19 pandemic are revenue and operational costs.”
According to the report, BOPEU anticipated that the negative impact of the pandemic would possibly increase impairment levels and delays in planned revenue generating projects. Along with that, the Group projected that existing liquid facilities were sufficient for a period not exceeding a year.
The auditors, Mazars, says throughout battling the COVID-19 scourge, noted the union’s current assets that exceed liabilities as a going concern and that its total assets also exceeded its total liabilities. “The union’s current assets exceed current liabilities by P3,838,989 (2019: P4,350,984) as at 30 June 2020 and its total assets were more than total liabilities,” say the report. “The Group’s current liabilities exceeded current assets by P10,370,604.”
The report notes: “The Group has adequate financial resources to continue in operation for the foreseeable future and accordingly the annual financial statements have been prepared on a going concern basis.”
The audited financials show that the BOPEU Group consolidated the Institute for Labour and Employment Studies for the first time in the current year. “Prior year numbers were restated to show the effect of consolidating the Institute for Labour and Employment Studies,” the report notes.
Depicting events after the reporting period, the report notes that the Group will continue to implement its strategic financial objectives to enable it to tackle financial challenges that pose a threat to its solvency.
“With the loan book declining at an alarming rate and loans disbursements turnaround times proving to be a challenge in current times because of cashflow issues, management sought a loan top-up from BancABC to address the backlog of loans subsequent to the year end,” it discloses.
The loan top-up was obtained to consolidate the Group’s debt, bringing it to P23.3 million. “Before consolidation, the total (Banc) ABC loan amounted to P 12.8 million, meaning the Group was afforded a change of P10.5 million from the top-up and all the funds were invested in the loan book, hence addressing the backlog issue,” says the report.