Audits in KZN most improved

2011-08-12 00:00

KWAZULU-NATAL municipalities made the biggest improvement in auditing performance of all the provinces, but the figure for unauthorised expenditure is up by 145% to R588 million.

These bouquets and brickbats emerged in the KZN Legislature yesterday.

On his round of visits to the provinces, Auditor-General Terence Nombembe said there are problems, but he recalled that just five years ago most municipalities in KZN had disclaimers and no one believed there could be a turnaround.

Nombembe said a lack of monitoring and control is a fundamental weakness in KZN. He said municipalities need to have a checklist of compliance and this is what his office will be monitoring.

“Use our methods to identify omissions. This requires no effort, just honesty, integrity and intense monitoring,” he said.

The Democratic Alliance spokesperson for the standing committee on public accounts(Scopa), Mark Steele, said the A-G’s report has revealed massive increases in irregular, unauthorised and fruitless expenditure in the province.

Irregular expenditure in the supply chain is up by 48% to over R1 billion, said Steele.

“The report also revealed that some R51,7 million worth of contracts were awarded to persons in the employ of the state, with R22,9 million paid to persons employed in the same municipality,” Steele added.

Nombembe said the other practice his office is determined to stamp out is the over-reliance on consultants. The time for consultants is over and municipalities must build capacity in their finance departments.

Inkatha Freedom Party MPL Mntomuhle Khawula noted that municipalities paid between R30 000 and R500 000 to consultants.

Members of the legislature questioned how municipalities receive unqualified audit reports only to discover a short while later that they face bankruptcy.

Nombembe explained that this can happen if monitoring is weak.

“The problem with an unqualified audit where the A-G expresses certain concerns is that you don’t know what is going to happen the next day” he said. This is why it is best to have a clean audit with no matters of concern and with an internal control environment that is strong and robust, he added.

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