Only 17 municipalities get clean audits

[Hemi300c]

Auditor-General Terence Nombembe speaks on reports relating to audits of national and provincial government departments.
Belinda Moses

PRETORIA – It was announced on Tuesday that only seventeen of South Africa's 278 municipalities have received clean audits for the financial year 2011-2012.

The Auditor-General (AG) Terence Nombembe released the latest report in Pretoria.

It showed that while a handful of municipalities performed better than the previous year, the majority remained in the red.

Along with the 278 municipalities, a further 60 municipal entities are included in the results.

Of those which received clean audits, only three municipalities and three municipal entities improved their results over the previous year to achieve a clean audit, while just over 30 others improved their results, but remained negative.

The three successful municipalities, George, Langeberg and Mossel Bay, are all in the Western Cape.

A further 50 auditees regressed from their previous year’s results.

The majority maintained mostly negative results from previous years.

None of the country's eight metropolitan municipalities managed to secure a clean financial bill.

The AG's office said metros were setting a bad example to their smaller counterparts.

“Unfortunately, the metropolitan municipalities faltered in their crucial role of providing exemplary leadership to smaller municipalities.”

Nombembe says the high vacancy rate in municipalities is partly to blame, saying a lack of chief financial officers (CFO’s) in municipalities is particularly problematic.

“At 73 percent of the auditees, vacancies in key positions and key officials without the minimum competencies and skills continued to make it difficult for these auditees to produce credible financial statements and performance reports.”

Clean audits have now been sitting at a level of five percent for the past three years.

Earlier this year, Nombembe warned that billions were being spent on consultants to do work that should be handled internally.

It appears the trend has remained, sending expenses spiralling among more than two thirds of municipalities simply for consultants handling financial matters.

The report is Nombembe’s last as AG as his seven-year contract will expire in November.

Parliament has begun the search for a replacement.

(Edited by Craig Wynn)

Viva cANCer Viva

 

[McSack]

“At 73 percent of the auditees, vacancies in key positions and key officials without the minimum competencies and skills continued to make it difficult for these auditees to produce credible financial statements and performance reports.”

Errmmm.... fsking HELLO. Did anyone expect any different result then?

 

[yebocan]

...sounds about right....

 

[frailty]

No surprises there, all of the clean ones in the Western Cape

 

[Bona Botse]

No surprises there, all of the clean ones in the Western Cape

Comprehension fail.

 

[Creag]

No surprises there, all of the clean ones in the Western Cape

Generalise much?

 

[Creag]

Stagnation found in report on municipalities

Pretoria - The Consolidated General Report on the Local Government Audit Outcomes of 2011/12 has revealed a picture of stagnation, with only nine municipalities receiving unqualified audit outcomes with no findings, the office of the Auditor General of South Africa (AGSA) said on Tuesday.

“One of the key things that stand out for us in this report is that we’ve noticed stagnation,” said Deputy Auditor General Kimi Makwetu.

The report found that nine municipalities received clean audits in the financial year ending 30 June 2012. Of the nine municipalities with clean audits, three had received clean audits for the first time. They are the George Local Municipality, Langeberg Local Municipality and Mossel Bay Local Municipality - all located in the Western Cape.

The other municipalities that received clean audits are the:

Umtshezi Local Municipality in KwaZulu-Natal
Waterberg District Municipality in Limpopo
Ehlanzeni District Municipality in Mpumalanga
Steve Tshwete Local Municipality in Mpumalanga
Swartland Local Municipality in the Western Cape
West Coast District Municipality in the Western Cape
Fezile Dabi District Municipality Trust in the Free State

According to the AGSA’s report, progress towards clean audits has been slow, with the number of clean audits remaining at the same low level of 5% for the past three years.

Almost half of the auditees that obtained a clean audit opinion were municipal entities rather than municipalities. In the Free State, Gauteng and KwaZulu-Natal, almost all the clean audits were achieved by municipal entities. Eight municipal entities had clean audits, including the Johannesburg Fresh Produce Market and the Fezile Dabi District Trust in the Free State.

The report covers four key areas, namely an overview of the audit outcomes; the root causes of audit outcomes; initiatives and impact of key role players on audit outcomes and the financial health of local government.

None of the country’s eight metros obtained a clean audit opinion. Clean audit opinions are achieved when financial statements are unqualified and there are no reported audit findings in respect of either reporting on predetermined objectives or compliance with laws and regulations.

The AG’s office noted a slow response by leaders to be one of the root causes of poor audit outcomes.

“There is a slow response to commitments that are made,” said Makwetu.

Another was the filing of vacancies in key positions such as that of chief financial officer, with the report noting that the filing of such posts did not always equal officials having the appropriate competencies to ensure quality financial statements.

Additionally, a lack of consequence for poor performance was another issue identified. The report recommended that in order to improve the performance of municipal officials, leaders should implement sound performance management processes.

Makwetu also highlighted that 71% of municipalities use consultants.

The Deputy Minister of Cooperative Governance and Traditional Affairs (Cogta), Andries Nel, thanked the office of the Auditor General for a thorough report, saying it was helpful in getting things right.

“The picture painted by the report cries out for concerted action by government at all levels,” he said, adding that the report does not make for pleasant reading.

Outgoing Auditor General Terence Nombembe -- whose term ends in November -- said one of the biggest “highs” for him during his tenure was the leadership of local government opening their doors to have conversations with his office.

The aim of the consolidated report is to empower leaders of provincial and local government to focus on issues that will result in reliable financial statements, credible reporting on service delivery and compliance with legislation. - SAnews.gov.za

http://www.sanews.gov.za/south-africa/stagnation-found-report-municipalities

 

[McSack]

The Deputy Minister of Cooperative Governance and Traditional Affairs (Cogta), Andries Nel, thanked the office of the Auditor General for a thorough report, saying it was helpful in getting things right.

“The picture painted by the report cries out for concerted action by government at all levels,” he said, adding that the report does not make for pleasant reading.

Been that way for how many years now? ... made any difference?
Please... pull the other one

 

[shogun]

Cape Town Metro? WTF? I'd like to hear some responses from the City of Cape Town peeps. Didn't they previously get clean audits and boast about it?

 

[Redeemed]

These Metros should be barred from increasing rates and taxes since they have failed to manage what they are being paid currently.

 

[koeksGHT]

Our Muni was asking me to get pirated auditing software for them a few months ago lol

oh, and that's why they failed xD

 

[rza]

J worked in the private sector for ten years as an Accountant, and recently joined government, and i can tell you that its so difficult to impossible to get a clean audit if you are such a big entity like a Metro Municipality. PFMA and all related regulations are unreasonable to insane, but it could be argued that they are necessary because we are dealing with taxpayers money and there are people with long hands. I can safely tell you that none of my former employers in the private sector will get clean audits if they were to use PFMA for instance. The media paints a picture of incompetence or unwillingness but the government actually has competent people, its just that the Metro are too big and the Accounting policies are insane. At my work we have hundred thousands of assets and you have to account for all of them, and if you cant find some of them or they are wrongly identified then u get an audit finding/failure. Not even a firm of auditors can do that. So Metros are set up for failure because of unreasonable Accounting policies.

 

[intel8080]

“At 73 percent of the auditees,
vacancies in key positions and key
officials without the minimum
competencies and skills continued to
make it difficult for these auditees to
produce credible financial statements and performance reports.” Clean audits have now been sitting at a
level of five percent for the past three
years. Earlier this year, Nombembe warned
that billions were being spent on
consultants to do work that should be
handled internally."

WTF This is what racist, 'Affirmative Action' policies do! Critical posts can not be filled because of the race issue and huge amounts of money are spend on white expertise. This must be the pinnacle of Affirmative Action. What a nightmare. Welcome to the new South Africa

 

[samus]

Interesting map of audits:

Essentially only Western Cape, Gauteng and KwaZulu-Natal are doing alright. The rest are disasters.

 

[intel8080]

Interesting map of audits:

Essentially only Western Cape, Gauteng and KwaZulu-Natal are doing alright. The rest are disasters.

View attachment 65147

Western Cape is doing fairly ok, Gauteng is so - so. Natal ? ? ? WTF You call that alright? Oh I see. Compared to the other provinces . . .

 

[genetic]

No surprises there, all of the clean ones in the Western Cape

Can't read, eh?

 

[intel8080]

I wonder why is western cape doing good while eastern cape is a mess? Is it fair to assume that the people running the western cape are more responsible?

 

[samus]

Western Cape is doing fairly ok, Gauteng is so - so. Natal ? ? ? WTF You call that alright? Oh I see. Compared to the other provinces . . .

Yes, lol, compared to the others. I mean look at all those disclaimers and adverse opinions in the North West, it's almost enough to make one cry.

Can't read, eh?

While he's wrong on that, WC does have the highest number of clean audits of any province, and also the highest number of almost clean audits (unqualified with findings).

 

[Garson007]

Christ Northern Cape, how can so many of you not commit to the audit?

 

[doubletrouble]

It would be interesting to see of the Municipalities in the western cape with bad audits, how many of that municipalities are ANC municipalities and how many are DA municipalities