Why Corrupt Countries Will Never Reconcile Their Accounts — And Why the Whole World Lets Them Pretend They Will

By: John S. Morlu II, CPA

The global financial system is a theatre. And developing countries? They are the stage on which reconciliation, transparency, and accountability are loudly promised… but never performed.

1. The Inconvenient Truth No One Wants to Say Out Loud

There is no pathway, no roadmap, no capacity-building workshop, no IMF monitoring mission, no World Bank-funded PFM reform, and no consultancy report that can make a corrupt country reconcile its accounts.

Why? Because reconciliation requires honesty.

And honesty is incompatible with a system built on:

• political patronage
• rent-seeking
• unexplained “variances”
• “lost receipts”
• undisclosed debt
• hidden accounts
• “temporary transfers” that were never temporary
• donor-funded “reforms” that reform nothing

Reconciliation is not a technology problem. It’s not a skills problem. It’s fundamentally a power problem—because true reconciliation exposes who took what, who owed who, and whose fingerprints are on the missing millions.

In most corrupt states, that truth can collapse a regime in 24 hours.

So the safest policy is simple: never reconcile anything properly.

2. The Real Reason: Corruption Has a Formula—And Reconciliation Breaks It

Corruption is not randomness. It’s a system.

A well-coordinated, multi-generational, elite-maintained system with its own design:

• Budgets are aspirational fairy tales
• Expenditures are creative fiction
• Revenues are suggestions, not numbers
• SOEs are personal ATMs
• Ministries keep parallel books
• Audits are ceremonial rituals
• Donors demand change—but only in PowerPoint

In such an ecosystem, reconciliation is lethal because reconciliation converts political chaos into numerical truth.

And political actors cannot survive numerical truth.

3. Donors Know This—But They Pretend Not To

Let’s list the actors:

• IMF
• World Bank
• African Development Bank
• Asian Development Bank
• Inter-American Development Bank
• European Union
• USAID
• Foreign Ministries
• International NGOs
• Bilateral Aid Agencies

Every single one of them knows that most corrupt countries will never reconcile their accounts.

Yet the theatre continues:

• Millions spent on “capacity building”
• Workshops on IPSAS
• Trainings on SOE governance
• Budget reform missions
• PFM projects
• Donor reviews
• “Transformation Blueprints”
• And the favorite: “Strengthening Internal Controls for Transparency”

Everyone signs the attendance sheet. Everyone takes group photos. The consultants submit a 200-page report. The Ministry says, “Implementation is ongoing.” And the donors mark the project “successful” because they disbursed the money.

The success metric here is spending—not outcomes.

4. Why Donors Play Along: Because They’re Not Saints Either

Let’s speak honestly.

(a) Aid Is a Business

The global development industry makes billions annually.

If corruption suddenly disappeared:

• 80% of development consultancies would collapse
• thousands of “governance experts” would be jobless
• donor countries would lose soft power
• aid budgets would shrink

Corruption keeps the development economy alive.

(b) Donors Need Access

Reforms are a bargaining chip. You apply pressure; they return contracts, votes, mineral concessions, and diplomatic alignment.

(c) Donors Fear Political Instability

If you force clean books, you expose theft. Expose theft, elites fight. Elites fight, you get coups, refugees, and collapse.

So donors prefer stability over truth.

(d) Donors Are Sometimes Complicit

Let’s be blunt: corruption travels in both directions.

Some donor officials:

• receive kickbacks
• approve fake procurement “because it’s politically sensitive”
• downplay audit issues
• suppress bad reports
• live comfortably in fragile states
• collect hardship salaries
• rotate every two years with no accountability

And oversized per diems don’t encourage reform. Nobody wants to fix a system they benefit from.

5. Why Reconciliation Is Impossible: The Data Is Designed to Be Foggy

You cannot reconcile what:

• doesn’t exist
• exists in duplicate
• exists in triplicate
• exists only in Excel files saved as “FINAL_v13_REAL_FINAL.xlsx”
• is recorded using cash accounting mixed with modified accrual—sprinkled with political magic
• is stored in ministries where the last working computer died in 2012
• was never recorded because “the officer was on leave”
• disappeared when the accountant left with the only password
• was intentionally fragmented so no one sees the full picture

Reconciliation is impossible because opacity is the business model.

6. SOEs: The Black Holes of Public Finance

State-owned enterprises are where:

• debts are hidden
• losses are normalized
• payrolls are inflated
• procurement fraud thrives
• board members eat like royalty
• politicians hide liabilities
• donors pretend not to notice

If an SOE were ever fully reconciled:

• half the senior leadership would resign
• the board would collapse
• the Minister would be exposed
• politicians would panic
• and donors would quietly get nervous

SOEs cannot be reconciled because SOEs are designed to hide what the main budget cannot hide.

7. Why Technology Doesn’t Fix Anything

Digitization is useless without political will.

You can bring:

• Oracle
• SAP
• Recksoft
• FinovatePro
• FreeBalance
• IFMIS
• AI-based reconciliation engines

But if the elite want opacity, they will simply:

• refuse to upload data
• keep parallel books
• lock system access
• override transactions
• disable audit trails
• manipulate back-end entries
• create ghost vendors for procurement

Technology enhances transparency only where transparency is allowed. Otherwise, it automates corruption.

8. Why Everyone Pretends Reconciliation Is Coming “Next Year”

Each year follows the same script:

• January: “We commit to transparency.”
• March: “Systems are being upgraded.”
• June: “There were capacity delays.”
• September: “A donor mission is coming; wait.”
• November: “We will finish reconciliation next year.”
• December: Budget passed.

Nobody cared about last year’s variances. Reset. Repeat.

9. The Global Hypocrisy: Everyone Benefits from the Illusion

• Corrupt governments love pretending to reform.
• Donors love pretending the reforms work.
• Consultants love writing reports nobody reads.
• Politicians love using the funds quietly.
• Civil servants love the allowances.
• Elites love the untraceable cash flows.
• International institutions love the leverage.
• Foreign governments love the influence.

It’s a perfect ecosystem of selective amnesia.

10. So Is There Any Hope? Yes—But Not Where People Think

Real reconciliation requires:

• political courage
• independent institutions
• prosecution of elites
• enforced asset declarations
• full digitization with no manual override
• independent auditors with tenure protection
• donors willing to be unpopular
• citizens willing to demand accountability
• a blackout period where nobody can interfere

In other words: reconciliation demands a revolution, not a workshop.

Conclusion: The World Doesn’t Actually Want Corrupt Countries to Reconcile Anything

If corrupt countries reconciled their accounts:

• trillions in stolen wealth would be uncovered
• dozens of governments would fall
• entire patronage networks would collapse
• donor narratives would evaporate
• development institutions would lose relevance
• the global equilibrium of controlled dysfunction would break

So everyone plays along: the corrupt pretend to reform, the donors pretend to believe, and the consultants pretend it will work.

Reconciliation is not coming. Not because it is impossible—but because it is not permitted, and because too many people profit from the chaos.