AUDIT OUTCOMES
Summary by Department
1. Financial Mismanagement in the Department of Health
In each of his reports on the department’s finances since 2000, the Auditor-General has highlighted several critical financial management problems within the Department of Health. It seems that the Minister and her department simply ignore these reports, because no obvious action is ever taken to address them, and the same problems continue to be raised year after year.
2. Doors wide open: An analysis of the financial (mis)management of the Department of Correctional Services:
Over the past four years, the Auditor-General’s annual audits of the Department of Correctional Services have uncovered a range of significant problems in the administration of the Department’s finances and the management of prison staff. Moreover, although many of the same problems have been raised repeatedly, there is little evidence in the reports covering the past few years of efforts to address these problems.
3. Parliament receives third qualified A-G report in a row:
Parliament is supposed to be the cornerstone of our democracy – the home of policy and legislation. How are ordinary people supposed to take the institution seriously if it cannot even manage its own finances? To get three qualified audit opinions in a row is an indictment of the current administration. The Democratic Alliance believes action must be taken against the Secretary to Parliament, Mr Zingile Dingani and the Audit Committee, both of which are responsible for Parliament’s finances and both of whom have failed to manage public money properly for three years in a row.
4. Sheltered Employment Factories receives disclaimer from AG
The Sheltered Employment Factories (SEFs) has received a disclaimer of opinion from the Auditor-General for its 2005/06 financial statements. A disclaimer of opinion is the worst finding the AG can make - it means that the finances of the relevant institution are in such a state of disarray that the AG cannot properly account for the validity or accuracy of the financial statements and, in fact, cannot even express an opinion.
5. Home Affairs Gets Its 5th Consecutive Qualified Audit Report
In a damning report the A-G lists some 12 points of qualification or disapproval, a further indictment of a department which is renowned for the shocking way in which it is being administered. It is therefore all the more alarming that the Department’s internal audit committee, in its report, chose to accept the hardly-improved state of financial management in the Department with quiet resignation, rather than facing up to the reality of the situation.
6. Five Qualified opinions in a row for Defence
The 2005/06 annual report of the Department of Defence (DoD), which contains its financial statements, was tabled in Parliament this week. For the fifth year in a row the Department received a qualified audit opinion from the Auditor-General (AG). Action must now be taken to remove those people responsible for the mismanagement of the Department’s finances from their positions.
7. Agricultural Debt Account gets a Qualified Audit Report
The Department of Agriculture’s Agricultural Debt Account (ADA), from which loans to farmers are drawn, has received a Qualified Audit Report for 2005/2006. While overall, the Department’s books are in good shape, the failure of the department to report properly on the debts it is owed, or the amount of interest revenue it has received, is an indication of a wider problem – the lack of crucial expertise and proper accounting and data management systems within the Department of Agriculture.
8. Department of Transport descending into financial management mess
The Department of Transport (DoT) has been served with its second consecutive qualified audit report by the Auditor-General (A-G) for exactly the same problem as before. For the second year in a row, the financial position of the DoT could not be accurately confirmed by the A-G because the Department again failed to produce statements of transactions related to the production of credit card format driving licences. It is becoming increasingly important that the Department concludes this matter so that the A-G can confirm that the seemingly growing areas of concern that have been identified are not more serious than they appear.
9. Water Affairs and Forestry back on slippery slope
The Department of Water Affairs and Forestry (DWAF) seems to be back on the slippery slope of financial mismanagement. The Auditor-General (A-G) has expressed a qualified audit opinion on the financial statements of DWAF, the fourth time he has expressed such an opinion or worse in relation to this Department over the last five years. DWAF has a history as one of the South African government’s departments with the worst financial management records. Traditionally, this was mainly due to the lack of adequately experienced and qualified financial management personnel, the lack of the necessary information technology infrastructure and the use of antiquated management systems.
10. 2004/05 Audit Outcomes: National Departments in state of financial disarray
An overview of the audit outcomes of government departments over the past four financial years proves that too many government Ministers and Directors-General are simply unable to provide proper financial management of public money. Indeed, in many cases, the overview paints a picture of financial disarray and mismanagement on a grand scale. Since 1994 various requirements have been placed on government departments to try to ensure that limited financial resources are used effectively. Different departments have implemented these requirements with various degrees of success.
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