KZN municipality council seeks to control forensic investigations

The Msunduzi executive committee (exco) in KZN seeks to strip its internal audit unit of the powers to approve and initiate forensic investigations.

The powers to approve and initiate such investigations will be given to the full council, the executive committee heard.

In a recent exco meeting sitting at the city hall, a report on council approval of investigations was tabled for consideration. The matter will be sent to the full council for approval.

According to the report, council should resolve that, going forward, all forensic investigations be at the discretion of the council, and council will solely reserve the right to approve forensic investigations.

“It is apparent that there seems to be a grey area as to which department or committee of council is responsible for the commissioning and approval of forensic investigations in Msunduzi Municipality.

“This does not bode well for the institution as there is no centralised systematic approval of forensic investigations and is contrary to good governance principles. The rules and functions of the internal audit and the audit committee have been extracted from various pieces of legislation, the council-approved internal audit charter, good governance practices, and others,” read the report.

The report contained comments from city manager Lulamile Mapholoba, who found the move to be a positive one.

Mapholoba said engagements have been held between the chief audit executive, the chairperson of the audit committee, and the mayor, Mzimkhulu Thebolla, on the matter, and there was consensus that there was a need to enhance the credibility of the internal audit unit.

Currently, the internal audit unit, at its own discretion, makes the determination on which matters to perform general audits and forensic audits on.

This has created the perception within the municipality that internal auditing is biased and that it is both the player and the referee at most times.

“It is critical that this perception is dispelled and that internal audit is seen as critical to moving the municipality forward rather than as a punitive mechanism to deal with certain individuals within the municipality,” said Mapholoba in the report.

National Treasury

He said a meeting was held with the National Treasury, and he was now awaiting correspondence from them to formally sign off on the arrangement proposed by the treasury.

“Having brought the above matters to your attention, I would like to attend to the matter of where the authority rests for the commissioning and approval of forensic investigations. My view is that only the council has the authority to approve forensic investigations.

“This report is submitted to council on the matter, and the report recommends that all forensic investigations will be at the discretion of the council, and council will solely reserve the right to approve a forensic investigation.

“Council is hereby advised that the process going forward will require any committee or department of council to prepare a report requesting the accounting officer to seek authority and approval from council for the commissioning of an investigation,” he said.

A source within the municipality said that given the ‘rot’ in the city, the move was not an ideal one.

“Section 166(2)(d) of the Municipal Finance Management Act 56 of 2003 states that an audit committee is an independent advisory body that must carry out such investigations into the financial affairs of the municipality or municipal entity as requested by council. The responsibility of conducting investigations has always been a delegated function to internal audit, which reports functionally to the audit committee, which is an independent advisory body,” the source said.

“In my view, at least the city manager should have asked the council to delegate this function to him if he foresees a challenge.

“I can imagine a situation where allegations against a general manager who is cosy with the leadership whether an investigation into those would be authorised. Fraud and corruption allegations against leadership will not be investigated.”

Opposition parties

IFP councillor in Msunduzi Thinasonke Ntombela said this move could be used to protect certain individuals from investigations.

“We need to understand the context under which they are making these changes so that we can be in a better position to comment,” said Ntombela.

DA’s Ross Strachan said while the city was still under administration, the ministerial representative has powers in terms of his terms of reference, given by Cogta MEC, to initiate forensic investigations.

“In terms of the full council’s responsibility, this process and system should be streamlined so that reports of this nature be prioritised, internal audits are given more capacity or budget, and we work on relieving ourselves of the devastating backlogs of forensic investigations that never see an end,” said Strachan.