Cape Town - A lack of paperwork to track infrastructure spending totalling billions of rands is among the reasons water affairs received another qualified audit last year.
“The department did not have adequate systems in place,” the Auditor General said on Thursday, in a report tabled at Parliament.
Such systems were necessary to maintain records of commitments, where the procurement of goods and services had been approved and/or contracted, but where no delivery had taken place by the end of the 2012/13 financial year.
“(This) resulted in commitments being misstated by R1.1 billion.”
The AG's report - on water affairs' main exchequer account - is contained in the department's annual report, which covers the 12 months to March 31 this year.
According to financial statements in the annual report, the department's “commitments” - understood to be money earmarked for the procurement of goods and services - totalled R19.7bn in 2012/13, and R21.3bn the year before.
In his report, the AG said he was “unable to obtain appropriate audit evidence due to lack of supporting documents for the restatement of the corresponding figures for commitments”.
The restatement referred to is a note inserted in the annual financial statements. According to this the prior year commitments were adjusted by R20.6 billion relating to regional bulk infrastructure grant projects.
Acknowledging the restatement was made to rectify a “prior year misstatement”, the AG said he was unable to confirm this.
“Consequently, I was unable to determine whether any adjustment to the commitments' corresponding figure stated at R21.3bn in the financial statements was necessary.”
A further “lack of supporting documents” meant he was also unable to “determine whether any further adjustments to commitments stated at R19.7 billion in the financial statements were necessary”.
Over and above the department's paperwork problems, the AG also fingered it for irregular spending.
“The department made payments in contravention of the supply chain management regulations amounting to R13.6 million... .”
Systems meant to control this were “inadequate”. Consequently, “I was unable to determine whether any adjustments relating to irregular expenditure disclosed as R1.1bn... in the financial statements was necessary”.
The AG said he was also unable to obtain “appropriate audit evidence” for a R326.4m adjustment to accrual figures in the financial statements, as well as adjustments totalling R358.2m made to so-called immovable tangible capital assets figures.
The department also received a qualified audit in 2011/12.
In a foreword to the latest annual report, Water Affairs Minister Edna Molewa said the department had “made a commitment to achieve a clean audit by 2014”. - Sapa