{"id":50290,"date":"2019-02-14T06:00:25","date_gmt":"2019-02-14T04:00:25","guid":{"rendered":"https:\/\/novanews.co.za\/komani-karoo\/municipality-receives-unqualified-audit-20190206\/"},"modified":"2025-03-19T16:38:15","modified_gmt":"2025-03-19T14:38:15","slug":"municipality-receives-unqualified-audit-20190206","status":"publish","type":"post","link":"https:\/\/novanews.co.za\/komani-karoo\/municipality-receives-unqualified-audit-20190206\/","title":{"rendered":"Municipality receives unqualified audit"},"content":{"rendered":"\n<p>INXUBA Yethemba Local Municipality received an unqualified audit opinion for the second year in a row from the Auditor General during the council meeting held on January 29. <\/p>\n\n\n\n<p>The report pertained to the municipality\u2019s financial year that ended on June 30, 2018 and the Auditor General is independent of the municipality in accordance with the International Ethics Standards Board for Accountants\u2019 Code. The following important findings were disclosed:<\/p>\n\n\n\n<p>Matters pertaining to previous financial years<\/p>\n\n\n\n<p>The following expenditures incurred in previous years have not been investigated by the municipality in order to determine whether any person was liable for these expenditures:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li> Unauthorised expenditure to the amount of R25 million; <\/li>\n\n\n\n<li> Irregular expenditure to the amount of R49 million;<\/li>\n\n\n\n<li> Fruitless and wasteful expenditure to the amount of R7.2 million.<\/li>\n<\/ul>\n\n\n\n<p>In the completed financial year<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li> R16.1 million was spent on consultants without prior assessment of proper needs. These consultants were performing work of a permanent\/continuous nature for which a suitable vacant position exists in the municipality, but no attempts were made to fill the position.<\/li>\n\n\n\n<li> R163 911 in payments were made to fictitious suppliers.<\/li>\n\n\n\n<li> R65.5 million (100%) of the irregular expenditure in the current financial year was a result of the contravention of supply chain management legislation.<\/li>\n\n\n\n<li> Fourteen tenders to the total amount of R21.3 million were awarded to persons in the service of other state institutions (a contravention of Regulation 44 prohibiting awards to persons already in the service of the municipality, any other state institution or entities managed by them).<\/li>\n\n\n\n<li> Four contracts and quotations to the value of R14 million were procured from suppliers whose tax matters had not been declared by SARS to be in order.<\/li>\n\n\n\n<li> The municipality only managed a creditor-payment period of 358 days, while their debtor- collection period was 102 days. <\/li>\n\n\n\n<li> Current liabilities of the municipality expressed as a percentage of next year\u2019s budgeted resources, stands at 65%, which means that for every R1 revenue received, R0,65 will have to be awarded to creditor-payment.<\/li>\n<\/ul>\n\n\n\n<p>In conclusion, the municipality\u2019s financial viability was assessed by the Auditor General to be \u201cRed \u2013 unfavourable \u2013 intervention required\u201d in accordance with section 139 of the Constitution. <\/p>\n\n\n\n<p>The Auditor General was of the opinion that \u201cthe financial statements indicate that the municipality is experiencing financial difficulties in that its current liabilities exceed its current assets to the extent that significant doubt is cast on the municipality\u2019s ability to continue funding its existing level of operations.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>INXUBA Yethemba Local Municipality received an unqualified audit opinion for the second year in a row from the Auditor General during the council meeting held on January 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