Agricultural Marketing Cooperative Society, Tulkarm (Palestine)

-        From the substance of the texts of the reports of the General Department of Audit of Institutions and Non-Governmental Organizations NGOs, in the State Audit and Administrative Control Bureau (SAACB), which conducted a financial, administrative and compliance audit, we include below the substance of the Bureau's report on the "Agricultural Marketing Cooperative Society Tulkarm".

-        The Agricultural Marketing Cooperative Society in Tulkarm was established in 1981, and the Society aims to develop the cooperative spirit among farmers, encourage them to use modern agricultural methods, market their products, and supply them with agricultural inputs. Expenses in it in 2017 amounted to 87,817 shekels, and revenues for the same year amounted to 160,728 shekels.

-        The State Audit and Administrative Control Bureau (SAACB) conducted an audit examination of the Society's activities for the fiscal year ended 31-12-2017, and the Bureau concluded the following material observations:

·       Agricultural Reclamation Project:

1-     There are no clear and documented mechanisms for receiving citizens' applications to benefit from the Agricultural Reclamation Project, in addition to no mechanism for comparing those applications.!

2-     The supporting documents for the Land Reclamation Project do not match the value of the bid, invoices and receipt vouchers, which resulted in a difference of 15,068 dollars.!

3-     Through bank certification of the final beneficiary of the checks issued on the project account, it was found that they were issued in the name of the head of the Society, and a check issued in his favor was found, amounting to 34,980 dinars..(thirty-four thousand nine hundred eighty dinars), and they were not supported by original documents.!

4-     There are differences amounting to 23,413 dollars in the total land reclamation costs, which amounted to 92,178 dollars according to the detailed reclamation cost statements, while the value of the bid and invoices submitted by the executing company amounted to 115,600 dollars.!

5-     The persons committed to pay beneficiaries' fees for the Land Reclamation Project, in the amount of 500 dollars, are only 15 persons out of 58 persons, and 43 persons did not comply with payment, resulting in a financial impact of 21,500 dollars.!

6-    The amount collected from those committed to pay, amounting to 7,500 dollars, was not deposited in the bank and was not recognized in the financial statements.!

7-     There are no completion reports from the implementing party of the Agricultural Reclamation Project, in addition to the absence of an acceptance report from the supervising engineer; consequently, there are no confirmations regarding the accuracy and completeness of the project completion statements.!

8-     The fees paid by farmers amounting to 50 shekels for agricultural inputs were not recorded, nor was it shown that the amounts collected from members were deposited in the bank.!

·       Financial Statements :

1-    The presentation of the Society's financial statements is not fair due to the Society's failure to recognize the value of the grant (the Land Reclamation Project in Tulkarm) and the expenses executed on it, which amounted to about 330,000 dollars (three hundred thirty thousand dollars), which is equivalent to more than 1260% of the Society's administrative and general expenses amounting to 87,817 shekels.!

2-     There is inaccuracy in the accounting recording operations at the Society, where recording is done in an ordinary paper ledger that does not meet the basic recording requirements.!

3-    There is a rise in the volume of accumulated receivables (loans) from Society members, which amounted to 755,044 shekels at the end of 2017, representing 91% of total receivables, without the administration taking any collection measures.!

·       Sale of Agricultural Supplies

1-    There is no effective control over the activities of the Society's agricultural supplies sales outlet, as there is no centralized cost account specific to the agricultural supplies outlet, electronic systems are not used to manage inventory and sales operations, and the Society does not carry out periodic physical inventories of the warehouse and cash inside the Society!

2-    There is no benefit to the Society from retaining the agricultural supplies outlet, as it was observed to incur annual losses.!

·       Feed Factory:

1-    The Society did not recognize the value of the feed factory within the general budget for 2017, as the value of the factory's building was recorded in the budget as 27,926 dinars net.!

2-    The Society did not comply with announcing and holding a public auction to include the factory, as the factory has been guaranteed to Al-Sha'ar Trading Company operating since the factory's establishment about 25 years ago, and in 2011 the Society signed a new guarantee agreement with the same person for an additional 10 years.!

3-    The company did not commit to providing the Society with annual financial reports that clarify its business results and its obligations to pay the dues due to it.!

·       The report explains itself.....!

·       Response to the report: the report was forwarded to the Anti-Corruption Commission due to the existence of suspicions of corruption, and to the Ministry of Labor to implement the recommendations...

·       On 1-12-2020