Limpopo on upward audit spiral

Limpopo was bestowed an early Festive Season gift yesterday (Wednesday) when singled out for most improved audit outcomes of all of South Africa’s provinces, as reflected in Auditor-General Kimi Makwetu’s consolidated 2014/15 audit report outcomes of national and provincial government departments and entities.
Of the 23 provincial government departments and public entities up for auditing the Office of the Premier is the only one in Limpopo that achieved a clean audit for the 2014/15 financial year. Fourteen of the institutions received financially unqualified audit opinions with findings on performance information and/or compliance with key legislation. They are the Departments of Agriculture, Economic Development, Environment and Tourism, Cooperative Governance, Human Settlements and Traditional Affairs, Health, Social Development, Provincial Treasury, Transport, Safety, Security and Liaison as well as the Legislature and entities Mununzwu Estate, Venteco, Limpopo Gambling Board, Great North Transport and Risima Housing Finance.
The institutions that received qualified reports with findings are the Departments of Public Works and Sport, Arts and Culture as well as Limpopo Tourism Agency (LTA) and Corridor Mining Resources.
The situation at the Department of Education, however, looks equally bleak as in the past years upon receiving its fourth disclaimer. The department was listed as one of the main contributors to irregular expenditure in the country. Also Roads Agency Limpopo (RAL) got an adverse opinion. The Department of Cooperative Governance, Human Settlements and Traditional Affairs (Coghsta) regressed from a clean audit to unqualified with findings.
From the results released by the AG in Pretoria at the time of going to press, it seemed as if the province had made progress in improving its audit outcomes over the past five years with an improvement at seven of the auditees.
In a media release issued after yesterday’s press briefing, it was mentioned that Gateway Airports Authority Limited (Gaal) had not submitted their annual financial statements for the 2014/15 financial year within the legislated timeframe. In his report Makwetu also referred to auditing of the statements of Limpopo Economic Development Agency (Leda) not having been finalised as yet.
It was stated that the quality of the submitted annual financials remained cause for concern as only two auditees submitted financial statements which were free of material misstatements. There has reportedly been some improvement in the area of consequence management where the provincial leadership took action against poor performance, which led to officials bearing consequences for poor performance and transgressions. “Auditees focus on addressing qualification matters in the financial statements without making the same effort in the case of findings on performance reporting and compliance with legislation. Until such time as the same amount of attention is given to all three areas, the move towards more clean audits will be slow.”
There was a notable reduction in reported irregular as well as fruitless and wasteful expenditure of 41% and 34% respectively. However, irregular expenditure was still higher than the reported amount in the 2012/13 financial year. Unauthorised expenditure has decreased by 69%, as stipulated in Makwetu’s report.
In the meantime Limpopo’s Executive Council (Exco) budget lekgotla was underway at Protea Hotel Ranch Resort at the time of going to press. The assessment of progress on the implementation of the Provincial Clean Audit Strategy served as discussion matter on the agenda. The lekgotla brought together, among others, political and administrative heads of departments and state-owned entities as well as senior government officials. In his address Premier Stan Mathabatha referred to a number of issues being raised by the AG with him and the relevant officials in the past, being the lack of leadership and accountability, disregard for basic rules and “sometimes just plain ignorance.” He further mentioned a “scary vacancy rate”, especially of Chief Financial Officers (CFOs) and accounting officers in most municipalities.

Story: YOLANDE NEL
>>observer.yolande@gmail.com
NELIE ERASMUS
>>nelie.observer@gmail.com

Photo: Premier Stan Mathabatha addresses the Provincial Government’s Executive Council (Exco) Budget Lekgotla at Protea Hotel Ranch Resort yesterday (Wednesday).