Committee Supports Auditor-General’s Efforts to Ensure Accountability in Municipalities

The Standing Committee on the Auditor-General (SCoAG) today expressed concern over continuous failures by several municipalities to submit annual financial statements on time and the delays that result in the completion of audits, which continue to undermine accountability, service delivery, and the integrity of local government financial management.

As a result of this non-compliance the mandate of the Auditor-General of South Africa (AGSA) is impeded. In line with the scope of the SCoAG, the Speaker of the National Assembly referred the matter to the committee.

The committee received a briefing from the AGSA, Ms Tsakani Maluleke, on the process she has taken to escalate the challenge of municipalities who continuously submit annual financial statements late and those who do not submit annual financial statements at all. Ms Maluleke informed the SCoAG that she has escalated the matter to the Speaker of the National Assembly for intervention by Parliament.

Of the nine municipalities reported to the Speaker for non-compliance, six of them are in the Free State, one in KwaZulu-Natal, one in the Northern Cape and one in North West. The committee noted that one of the Free State municipalities, Maluti-A-Phofung, has been flagged by the AGSA for failing to submit consolidated AFS since the 2016/17 financial year, mainly due to significant backlogs and ongoing dysfunction of both the municipality and its entity, Maluti-A-Phofung Water SOC Ltd.

The continuous lack of compliance by auditees delays the finalisation of audits and hinders legislatures’ ability to exercise timely oversight over public funds.

The AGSA is obligated by the Municipal Finance Management Act to report by 31 October each year on municipalities that failed to submit annual financial statements.

The committee supports the Auditor-General’s appeal to the Speaker of the National Assembly for intervention and has committed to work closely with the other relevant National Assembly committees where necessary to explore stronger enforcement mechanisms.

Distributed by APO Group on behalf of Republic of South Africa: The Parliament.