## 3.2 Government Data Centre (GIDC) Project 

The auditors noted that stage 3 (Design stage) of the Government Data Centre (GIDC) project was ongoing with a total expenditure on the project during the year of P4 083 786.32, incurred towards the designs. As the project manager, Botswana Innovation Hub (BIH) was to earn a management fee of 10% of expected fees as per the Memorandum of Agreement (MOA). On the basis of the MOA with the Ministry of Transport and Communications, additional fees at the end of stage 3 should have been approximately P2 690 607 which was yet to be recognized. Depending on the stage of completion within stage 3, part of this fee needed to have been accrued to the extent of work done in 2017/18 and recognized as revenue. The auditors further noted that the receivable balance from 2016/2017 financial year of P841 761 on the project was yet to be settled. The discounting effect on P841 761 was not adjusted as it was assessed to be not significant. 

Based on further reviews and discussion with management, the auditors were informed that a challenge was faced on execution of the current design stage, as the designs that had been drawn were not coherent with the assigned plot in Palapye. In line with International Financial Reporting Standard 15, revenue recognition should only be upon fulfilling agreed upon performance obligations, which had not been met, hence it was appropriate not to accrue any management fee. 

In response Management stated that they continued to engage with the Ministry of Transport and Communications who had requested all outstanding invoices due which included BIH unpaid invoices of the two (2) amounts. Management further stated that the Deputy Permanent Secretary for ICT at MTC had assured BIH that they would resolve all issues for GIDC by November 2018. 

## 3.3 Procurement Policy Not Aligned with Board Resolutions 

The auditors noted on review that the procurement policy was still under review, pending approval as reported in the prior year. The policy approved in 2015/2016 along with the Board resolution passed on 10 May 2016 were currently applicable. On review of expenses against the procurement policy together with Board recommendations, the auditors noted instances where approval of expenditure was not by the personnel as prescribed by policy, but by personnel at the same hierarchy levels. 

