Msunduzi ticked off for wasteful spending

2011-07-01 00:00

A NEW qualification of unauthorised, irregular, fruitless and wasteful expenditure was added to the Msunduzi Municipality’s qualified audit report for 2009/10.

This information was contained in the Auditor-General’s report on the audit outcomes of local government.

Msunduzi Municipality managed to sort out three of the four qualifications it had in its previous audit.

The one qualification it carries from the previous year is poor capital assets management.

To this is added a new qualification — irregular, fruitless and wasteful expenditure.

It is believed that the new qualification is the result of the municipality being under administration and the resulting probe into its financial affairs by the provincial intervention team appointed by Co-operative Governance MEC Nomusa Dube.

The Auditor-General, Terence Nombembe, said the main reason for these qualifications remains a lack of monitoring and supervision by both the administrative and political leadership.

The audit report findings include:

• The net loss for the 2009/10 finanancial year, as the liaibilities of the municipality exceeded its assets.

• Msunduzi was number three in the list of top five municipalities that incurred the highest amount of fruitless and wasteful expenditure. Umhlabuyalingana and Sisonke District were higher.

• Msunduzi had given nine contracts worth R2 million to municipal officials and six contracts worth R6,6 million to people employed by other state institutions.

• It suffered material loses of R66 484 million on electricity, R63 066 million on water and R397 740 million on inventory.

The lack of monitoring and supervision is due to a lack of skilled staff in the accounting department.

Capital assets remain a qualification that Msunduzi has not been able to resolve for the second year in a row.

The problem arises from assets not being appropriately accounted for and the Auditor-General said this is due to lack of controls and proper record-keeping.

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