Polokwane – Auditor-General (AG) Terence Nombembe today released Limpopo’s improved local government audit results, which included the province’s first clean municipal audit. The improved results were, however, overshadowed by the results of municipalities that had regressed from the previous year’s improved audit outcomes.
Audit outcomes
The Limpopo Local Government comprises 30 municipalities and two municipal entities.
The 2009/10 results reflect improvements in the Blouberg, Greater Tubatse, Lephalale and Thabazimbi municipalities and Vhembe district municipality, as these municipalities improved from disclaimers of audit opinion to qualified opinions. Bela-Bela, Maruleng Mogalakwena and Mutale improved from qualified to unqualified with findings.
The audit outcomes of two municipalities regressed, namely Aganang and Polokwane, which both moved from unqualified with findings, to disclaimers. One municipality, Fetakgomo, received a clean audit report – financially unqualified with no findings on predetermined objectives and/or compliance with laws and regulations.
Among other findings the AG’s report highlighted the following:
The improvement in the audit outcomes of a number of municipalities could be ascribed to consultants, with 21 out of 27 municipalities making use of consultants to overcome a lack of technical financial expertise.
A sharp increase was also noted in the number of qualifications due to unauthorised, irregular, and fruitless and wasteful expenditure (14% in 2008/09 compared to 37% in 2009/10).
The most significant non-compliance issues related to the occurrence of unauthorised expenditure at 56% of the municipalities; transgression of supply chain management prescripts at 41% of the municipalities and one municipal entity and errors in the financial statements submitted for audit purposes at 93% of the municipalities and both the municipal entities.
The audits revealed that information technology continues to be a transversal challenge with most municipalities requiring intervention to address this aspect. Municipalities in Limpopo use 10 different computer application systems for financial accounting purposes; and personnel at most municipalities are not adequately trained to use these systems.
Service delivery findings
The report highlights that 74% of municipalities and both municipal entities face challenges in meeting reporting requirements on service delivery. Three municipalities (Makhudutamaga, Mutale and Thulamela) and both municipal entities (Zelpy Ltd and Polokwane Housing) did not submit their reports on predetermined objectives while four (Capricorn, Greater Giyani, Greater Tzaneen and Makhado) submitted their reports late.
Says Nombembe: "I am confident that Operation Clean Audit 2014 can be achieved if the commitments made by the leadership and legislature are successfully implemented and carried through. We are still a long way from the desirable position of having entirely clean reports, but with leadership commitment shown by the province, we are on the right track.
Working together with those charged with governance in the province, we’ll continue to push towards further improved results. The AGSA will monitor the effectiveness of the interventions in the province as well as the supervisory interventions of both the executive and legislative oversight."