Mawa Block 9 village – ‘Fairly healthy’ but must get better

2011-07-16 16:09

The finances of the Greater ­Tzaneen municipality appear to be “fairly healthy”.

But Auditor-General (AG) ­Terrence Nombembe says that the municipality faces “serious” financial sustainability and ­operational funding issues.

In his 2009/2010 audit report, he gave the municipality its third consecutive qualified ­opinion, meaning it had to improve its accounting practices.

A qualified opinion is usually given if an auditor disagrees with the treatment or disclosure of information in the financial statements, or if the auditor picks up one or two issues that do not comply with generally accepted standards.

Before its three consecutive qualified audits, the municipality had received three disclaimers for the 2004/2005 to 2006/2007 financial years.

The AG says ­municipalities received qualified ­reports mainly due to a lack of control of movable and immovable assets, inadequate systems and controls to account for ­water services transactions, and a lack of supporting documents.

The Tzaneen municipality was found to be compliant with the laws and regulations and demonstrated no irregular or wasteful ­expenditure.

Nombembe raised concerns about the municipality’s financial sustainability because current liabilities exceeded current assets by R33.6 million for the period ­under review.

Money received from conditional grants had been used to fund operational expenditure.

His concern stems from the municipality’s ­inadequate debt-collection ­policies and the fact that ­working capital requirements were not monitored by the ­leadership to ensure that the ­finances were in good standing.

The municipality also had ­unauthorised expenditure of R21 700.

Nombembe found that information submitted by the Greater Tzaneen Municipality was not consistent with targets and ­indicators set in yearly performance plans.

“Some targets were not ­specific in clearly identifying the ­nature and required level of ­performance.

“Some targets were not linked to a deadline for ­delivery,” Nombembe noted.

Municipal spokesperson ­Thulani Thwala said plans were in place to improve the municipality’s financial management.

He said that the municipality had no specific priorities for Mawa Block 9, but had issued a tender for tarring the road ­between Ga-Mokgwathi and Ramotshinyadi in the area, and fencing off cemeteries in all its villages.

“We cannot go to Mawa ­simply because the issues there are highlighted in the media. We will stick to our priority list that has been agreed upon,” said Thwala. 

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