AG Paints Bleak Picture on SOE Audits

Written by on 31 March, 2021

By: Lindelani Mbatha

Auditor-General, Tsakani Maluleke, says irregular expenditure among national and provincial government departments decreased to R54 billion from R66 billion last year.

Maluleke has been briefing media in Pretoria, on Wednesday afternoon, on the 2019-20 consolidated audit outcomes of national and provincial departments.

According to AG’s report, KwaZulu Natal audit outcomes improved with five auditees improving and only one regressing.

Maluleke says the irregular expenditure decrease is nothing to celebrate as 31% of the auditees failed to disclose fruitless and wasteful expenditure.

“In the current year, 231 auditees lost R2,39 billion in fruitless and wasteful expenditure. Over the last three years, R7.44 billion of government expenditure was fruitless and
wasteful.”

Maluleke expressed concern that State-Owned Entities (SOEs) are in serious financial difficulty and did not submit financial statements for auditing, including the South African Airways (SAA) and LMT Products (a subsidiary of Denel) which are under business rescue.

“In addition, many SOEs disclosed uncertainty in their financial statements whether they will be able to continue as a going concern and they include Eskom, Denel, South African Broadcasting Corporation, Land and Agricultural Bank of South Africa, Petroleum Oil and Gas Corporation, Independent Development Trust, Pelchem and South African Nuclear Energy. Corporation,” states Maluleke.

She adds that it’s concerning that public office bearers and officials are still doing business with the state even though that was outlawed in 2016.

 

 


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