Good morning, here is yesterday’s newsletter — apologies once again for the delay.
Televisão de Moçambique's latest audited accounts tell two different stories. One is attracting the headlines: a dispute over whether the broadcaster failed to provide information to its auditors. The other is more important: TVM remains financially dependent on the state, continues to accumulate losses and survives despite auditors warning of material uncertainty over its future.
Carta de Moçambique reported that auditors from Moore were unable to verify key balances because documentation had not been provided. TVM responded forcefully, insisting that it had supplied all the information formally requested. Both statements can be true. The audit itself does not accuse TVM of concealing information. It says the auditors could not obtain sufficient evidence to verify certain balances and were not presented with explanations for material discrepancies that emerged during the audit.
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But these omissions are less important than the fact that TVM generated only around MZN151m ($2.3m) in commercial revenue last year while receiving more than MZN531m ($8.2m) in government subsidies. Personnel costs alone exceeded its commercial income several times over. The broadcaster ended the year with a MZN107m ($1.7m) loss and negative equity of more than MZN1bn ($17m). State holding company IGEPE itself acknowledges that the company faces severe financial difficulties and is looking for ways to ensure its continued operation.
There is nothing inherently wrong with a public broadcaster relying on state funding. In most countries, public broadcasters receive public money because they provide services the commercial market may not. But that also means they should not seek to maximise advertising revenue in a way that distorts competition with private broadcasters. Their role is different. Public funding should buy public value, not market dominance.
