Cape Town - The auditor-general (AG), Kimi Makwetu, today reported minimal improvements in the audit results of South Africa’s municipalities for the past financial year.
Releasing the 2015-16 local government audit outcomes report, Makwetu said overall the local government had failed to maintain the promising five-year momentum gained in the previous years, 2010-11 to 2014-15. The audit outcomes of 263 municipalities and a summary of the key audit outcomes of 51 municipal entities are included in the report.
Makwetu’s report revealed that 14 municipalities had lost their clean audit opinions and that only nine joined the category of clean audits. The report showed that 49 municipalities achieved clean audits. The improvement in the audit outcomes of municipalities with 15% improving, 13% regressing and 67% remaining unchanged.
The Western Cape sits at the top of provinces with the highest proportion of municipalities with clean audit opinions with 80%,followed by KwaZulu-Natal at 18% and the Eastern Cape at 16%. The Western Cape has increased its clean audit opinions by 7%, from 73% in the previous year. The report showed that the only province that receives unqualified audit opinions is Gauteng due to its financial statements. Midvaal municipality was the only one to keep its clean audit status. North West, Northern Cape and Free State had also delivered the defective audit results while Eastern Cape, Limpopo and Mpumalanga had improvements.
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The AG’s latest report calls for leadership accountability. He highlights the importance of accountability in the management of municipal affairs, starting with appropriate planning focused on the needs of citizens, instituting appropriate internal control and supervision that will ensure proper financial and performance management.
He also mentions respect for the law in the running of municipalities, monitoring by all political and administrative leadership that budget and performance targets are appropriately achieved, and that there are consequences for mismanagement and non-performance.
Makwetu says if these basic principles of accountability, built around a central theme of strong internal control and good governance, are in place, municipalities should be well geared to live up to the expectations of the communities that they serve.
The AG’s report also singles out the slow response by the leadership in improving key internal controls and addressing risk areas such as key officials lacking appropriate competencies and inadequate consequences for poor performance and transgressions as some of recurring root causes to the minimal improvement in internal controls.