Auditor General Kimi Makwetu gave the Development Bank of Southern Africa (DBSA) a solid bill of financial health for the bank’s 2018 annual financial statements.
This emerged in DBSA’s annual integrated report for the 2018 financial year. However, the accounting authority of the DBSA acknowledged that the bank has had to tighten its financial resources.
The DBSA has had a rocky few years after publicly falling out with previous Eskom leadership on governance challenges, even threatening to withdraw a loan of over R15bn if now action was taken against Eskom chief financial officer Anoj Singh.
The state-owned development bank has stuck to its guns and weathered a trying period where perceptions of accountability and good governance at state departments and entities – some of DBSA’s main clients – suffered.
According to DBSA’s financial statements the financial assets carried at amortised cost amount to R76bn and the financial liabilities amount to R47bn. Makwetu said he was satisfied that the valuation of financial instruments measured at amortised costs was reasonable.
Makwetu said in his audit report that he considered DBSA’s internal control relevant to his audit of the financial statements, reported performance information and compliance with applicable legislation.
“However, my objective was not to express any form of assurance on it. I did not identify any significant deficiencies in internal control,” said Makwetu.
Makwetu said his office identified material misstatements in the annual performance report submitted on the reported performance information related to financial sustainability and sustained growth in development impact.
“As management subsequently corrected the misstatements, I did not raise any material findings on the usefulness and reliability of the reported performance information,” Makwetu said.
In DBSA’s 2018 sustainability review, DBSA CEO Patrick Dlamini said the bank approved a total of R14.5bn for infrastructure finance compared to R15.8bn in 2017.
The bank posted a net profit of R2.3bn compared to R2.8bn. While the total value of infrastructure projects prepared and committed for DBSA grew from R600m in 2017 to R954m in 2018, staff costs also increased from R604m in 2017 to R703m in 2018.