Philip Chiyangwa faces heat over Zifa deal

January 8, 2018
| Report Focus News

By Nigel Matongorere and Blessings Mashaya

In A potential breach of good corporate governance practices, Zifa’s latest audited financial results show that the flamboyant president of the country’s supreme football governing body, Philip Chiyangwa, earned $72 000 in 2017 alone by renting out his offices to the association.

Zifa’s offices were relocated from its headquarters at 53 Livingstone Avenue in Harare, to his plush offices along Enterprise Road in the capital two years ago.

According to Zifa’s audited financial results for 2016, which were compiled by Baker Tilly Gwatidzo Chartered Accountants, Chiyangwa’s company Kilima Investments currently charges Zifa $6 000 a month to rent its offices.

The lease agreement between Zifa and Kilima also stipulates that the rental fees, which must be paid in advance at the start of every year, will be increased bi-annually.

This comes as Zifa councillors are set to elect a new executive at their meeting scheduled for next month.

When Zifa moved into Chiyangwa’s Highlands property in June 2016, the monthly rental fees were pegged at $2 500 per month, before a significant increase to the current $6 000 was effected at the start of 2017 — marking a 140 percent jump in rentals in a space of six months.

The stipulated increases going forward also mean that Chiyangwa will stand to gain $90 000 per year between 2019 and 2020, when the rental fees will go up from $6 000 to $7 500 per month.

In total, the Harare businessman, who has vast interests in property development, will make a total of $420 000 by the time the lease agreement between Zifa and Kilima expires in September 2021.

“The association leases property from Kilima … situated at 160 Enterprise Road, Highlands. The premises include furniture, water, electricity, rates and Internet,” Baker Tilly Gwatidzo said in their 2016 Zifa audited accounts report.

“Kilima … is a company controlled by the Zifa president … Chiyangwa. The lease is from June 1, 2016 to September 30, 2021. The agreed monthly rental for the year 2016 was $2 500 per month exclusive of VAT and payable in advance.

“The rentals will be adjusted as follows: 2017 — $6 000 per month; 2018 — $6 000 per month; 2019 — $7 500; 2020 — $7 500 per month; and 2021 — $9 000 per month.

“Rentals of the subsequent years (2016-2021) will be paid one year in advance before January 1, of the rental year. In the current year $72 000 was paid to Kilima Investments in advance relating to the 2017 financial year,” the audit firm said.

The same audit report noted that it wasn’t only Kilima Investments which was doing business with Zifa as another firm, Hansporte Investments — in which Chiyangwa’s manager Marshal Jonga is a director — was in charge of the Zifa Village in Mt Hampden.

“The association paid $50 000 to Hansporte Investments for the renovations of the Zifa Village, and for furniture and fittings,” the audit report said.

All this notwithstanding, Zifa councillors have put their weight behind Chiyangwa — and are also defending the decision to relocate their headquarters to his private offices.

Speaking at a press conference at Chiyangwa’s offices in December last year, where provincial chairpersons endorsed Chiyangwa as their man to continue at the helm of the national football body, the councillors roundly praised the flamboyant Harare businessman.

“Creditors were after Zifa and if we had stayed at 53 Livingstone Avenue, the association was going to be brought down. That’s why we came here. We were given the premises by Chiyangwa so that we can operate from here.

“The issue of inflated rates is neither here nor there, it’s only hearsay. I don’t think all these people were there when the contract to use these premises were signed.

“I think the accounts papers are there and it will soon be published for the benefit of the public after the audit reports are presented at next year’s (this year) AGM,” Zifa Mashonaland Central chairperson Gilbert Saika said.

Below are the rentals that Zifa have committed to pay for use of Chiyangwa’s Offices.

Zifa Rentals to Chiyangwa

2016 — $15 000 ($2 500 per month)

2017 — $72 000 ($6 000 per month)

2018 — $72 000 ($6 000 per month)

2019 — $90 000 ($7 500 per month)

2020 — $90 000 ($7 500 per month)

2021 — $81 000 ($9 000 per month)

TOTAL — $420 000