SOEs still struggling to achieve clean audits - AG
Auditor-General Tsakani Maluleke says the country's state-owned enterprises are still struggling to achieve clean audits
Maluleke briefed Parliament's Standing Committee on the Auditor-General on the 2022-23 Integrated Annual Report.
Last month, the Department of Public Enterprises received a grim audit report from the Auditor-General, which highlighted stagnant outcomes with no notable improvement.
The DPE, which is led by Minister Pravin Gordhan oversees seven entities, Eskom, Transnet, South African Airways (SAA), Alexcor, Denel, the South African Forestry Company Limited (Safcol), and SA Express.
There were no clean audits and the DPE received a qualified audit, but there were 63% worth of outstanding audits, from five of the seven entities.
This was six months after the close of the financial year.
The report added that DPE was failing to implement a proper financial management system with credible reports.
The AG said the key contributors to the audit outcomes were instability in leadership and high vacancy rates in key positions, ineffective audit action and turnaround plans, oor record keeping resulting in limitations of scope, lack of accountability on improvement in financial and performance reporting, and poor consequence management on compliance with legislation and poor credible financial reporting.
Maluleke told Parliament on Friday morning that it remains the case.
"The state-owned entities are the once that still struggle to get to clean audit and even unqualified.
"So, the focus of our message, when we did the Public Finance Management Act, was to highlight that there is a long way to go before SOEs have a PFMA budget that is characterized by good financial management, good performance, and ongoing transparency and accountability," she said.
Maluleke said poor-quality statements, fraud, and corruption remain an ongoing challenge in the public sector.
"The poor quality of the annual financial statements and performance reports submitted by many of our auditees continue to absorb valuable audit time.
"Pushbacks and litigation often compromise our ability to meet our legislated deadlines and cause us to deploy scarce resources toward legal fees.
"We are faced with the continuous misuse of state resources.
"We are determined to provide insights and transparency on indicators of fraud, corruption, and state capture that we detect through our audits," she said.
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