City scrambles to sort out messy audit
Mayor Randall Williams says “in the last two years as mayor the City has continuously received unqualified audits”.
The Auditor General (AG) has identified “serious irregularities” worth billions in the Tshwane financial statements, a statement by mayor Randall Williams has indicated.
The statement says the report is expected to be presented to the council on January 26.
When the report was leaked, mayor Williams said that it was a “disappointment” and that “alarmingly AG Tsakani Maluleke has also identified officials and councillors who benefitted from supply chain processes”.
According to the recent statement, the report reveals that the metro deliberately filed an incorrect budget for its actual amount spent and that it did not correctly prepare and disclose its net cash flows from operating, investing and financing activities.
Among its many other financial statement irregularities, the metro accumulated R10-billion in irregular expenditure and R600-million in unauthorised expenditure.
Williams admitted that “in the last two years as mayor, the City has continuously received unqualified audits”.
“The decline in the City’s audit performance is unacceptable. As the political leadership, it is critical that we step up, take responsibility and ensure that we immediately plot a path towards achieving better audit outcomes,” said Williams.
Williams said that the City began implementing actions to address the audit findings as soon as it became aware of them.
The City is bringing criminal charges against former CFO, Umar Banda for what it called “abuse of the municipal finance management act”.
The multi-party coalition, comprising ActionSA, Freedom Front Plus, IFP, ACDP, Cope and the DA, said of the leaked report that it was disappointed by its findings.
“We are unequivocal in expressing our disappointment with the audit findings and expect urgent remedial action, deep reform and real accountability.”
But the coalition noted that it had taken over five months into the financial year under review and that “deep historical problems” underpinned the report.
“South Africans are looking to a grouping of political parties to provide an alternative to the failed ANC legacy of collapsing service delivery and rampant corruption,” it said.
Since the report findings were leaked, the EFF has called for the removal of what it calls the “lame-duck” mayor.
The ANC said it would be looking at actions including an application of section 139(5) of the constitution but without dissolving the council, instead seeking the appointment of an administrator “to turn the City around”.
This is not the first time the AG has warned the City of irregularities in its financial statements.
A July 2022 report called Tshwane the worst-performing metro in the province and flagged it for an irregular expenditure of R2.7-billion.
Acting AG business unit leader for Gauteng, Dorothy Rampopo, warned the City’s performance reporting was regressing.
At the time, she called the performance reports “poorly prepared” requiring “significant corrections”; yet, when this report was released, Tshwane had said that its financial statements were “fairly and appropriately presented in all material respects for the year under review”.
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