Revenue Services Lesotho (RSL) is facing a potential liability of M50.3 million as a result of lawsuits from companies and individuals, over the past several years for various matters.
This was revealed by the minister of finance and development planning, Dr Retšelisitsoe Matlanyane, on Monday this week when tabling the audit report on the financial statements of RSL for the year ended 31st March 2024.
“Management has made assessment of the possible liability as a result of these pending cases. The total exposure has been estimated at M50.3 million as at March 31 2024,” she said.
Matlanyane also noted a substantial growth in recurring expenditure for RSL during the year.
The organisation spent approximately M497.4 million in the period under review, an increase of about M55.1 million from the previous year’s expenditure of M441.3 million.
The RSL invested a total of M33.5 million on property, plant and equipment, an increase of M9.5 million from the M24 million spent on the same items the previous financial year.
As of the end of the financial year, Matlanyane noted, RSL held M591.7 million in cash and cash equivalents, a significant increase of M210.7 million from the M381 million held at the end of 2023.
“The Memorandum of Understanding (MoU) between the government of Lesotho through the ministry of finance and planning and RSL, provided for the transfer of all non-movable, free of charge, previously held by the departments of customs and excise, sales tax and income tax to the RSL.
“The assets have been revalued by (quantity surveying and project management company) Lethola Cost Associates.
“In compliance with good corporate governance principles, RSL has operated and maintained the financial and audit committee, human resource and remuneration committee as well as information and communications technology committee,” Matlanyane pointed out.
She further highlighted that RSL was totally committed to giving back to communities through its corporate social responsibility programme.
In a statement following the release of the performance report, the chairman of the RSL board of directors, Robert Likhang, said they had reviewed the organisation’s cash flow forecast for the year to March 31 2025 and were satisfied that RSL has access to continue in operational existence for the foreseeable future.
The board acknowledged that it was ultimately responsible for the system of internal controls established by the RSL and places considerable importance on maintaining a strong control environment.
“To enable it to meet these responsibilities, the board sets standards for internal controls aimed at reducing the risk of error or loss in a cost-effective manner.
“The standards include proper delegation of responsibilities within a clearly defined framework, effective accounting procedures and adequate segregation of duties to ensure an acceptable level of risk.
“These controls are monitored throughout the RSL and all employees are required to maintain the highest ethical standards in ensuring RSL’s business is in a manner that in all reasonable circumstances is above approach,” Likhang noted.
The board is also of the opinion that the system of internal control provides reasonable assurance that the financial records may be relied on for the presentation of the financial statements.
RSL is a semi-autonomous statutory body established by Act No:14 of 2001. It is charged with assessing and collecting tax on behalf of the government and administrating and enforcing the revenue laws including the Customs and Excise, Income Tax and Value Added Tax.
RSL collects inland taxes, duties and excise on behalf of the government and transfers these on a weekly basis.
