Latest government audits paint picture of financial mismanagement: AG – SABC News
Auditor-General (AG), Tsakani Maluleke, has delivered the 2024/25 national and provincial government audit outcomes, saying 151 out of 417 have achieved clean audits.
This marks an improvement on the 142 clean audits reported for the previous 2023/24 period.
However, the AG says it’s still very slow progress, adding that more needs to be done to get the public sector to improve in financial management and ultimately, service delivery.
Tsakane says the 151 clean audits represent only 12% of the R2.21 trillion expenditure in the year 2024/25, which is an indictment on the system, and fails the vast majority of South Africans in getting constitutionally mandated public services.
“What it tells you is that 88% of the budget sits in the hands of auditees that are unable to demonstrate that they have good financial management practices, stable performance planning and reporting practices and the type of integrity, measures and controls that ensure that when they procure goods and services, they do so in a manner that respects the rule of law”, Maluleke says.
Giving a high-level view of provincial performance, the AG noted that the Free State and the North West continued to be the worst performers, with no overall standout performance across the board.
The Western Cape continued to attain the highest level in terms of clean audits.
“Perhaps some things to note; if you look at the Eastern Cape, there were some encouraging improvements, and if you look at the budget numbers in terms of the level of improvement, the story there is that the Eastern Cape Department of Health had actually improved its audit outcomes. They are not yet clean audit outcomes, but they’ve improved from qualified to unqualified audit opinions and that came on the back of support offered by support from the Provincial Treasury in the main. They were able to work with those specific departments and help them to compile decent financial statements,” adds Maluleke.
The AG says the trend of celebrating the attainment of an unqualified audit opinion with findings was problematic because many of those departments affected in this way show key weaknesses that negatively affect service delivery.
Maluleke says, “We found that many of them have high levels of noncompliance. We found that they are the largest contributors to irregular expenditure, and, of course, irregular expenditure occurs when there’s been non-compliance with laws and regulations relating to procurement. We’re finding that many of them, when they submit a set of financial statements for audit and when we begin the audit, what they give us is not of good quality and, as I said before, what it tells us is that their own internal financial management practices are not quite as strong”.
In terms of state enterprises, the AG reported that only two out of the 19 assessed had clean audits, with the likes of Transnet and Eskom being far away from achieving this ultimate goal.