Madibeng spent over R17 million during the 2019/20 financial year on interest charges relating to late payment of invoices.
For the fourth consecutive year the municipality received a disclaimer of opinion from the Auditor-General. The basis for the disclaimer was the AG’s inability to obtain appropriate audit evidence and incorrect disclosure, amongst other things, the AG said in the report.
According to the accounting officer’s report, Madibeng paid R17 364 909.41 interest for late payment of invoices from Eskom, Randwater (R363 154.23), City of Tshwane (R4 468 799.40), Auditor-General (R672 961.88), SARS (97 215.57) and Department of Water and Sanitation (R3 011 710.95).
The audit committee also expressed its “grave concern” about the municipality’s Budget and Treasury office that spent over R30 million towards consulting fees “Without any significant benefits seeing that the municipality has been receiving a disclaimed audit opinion for the past four audit cycles.” This, while the office is fully capacitated in term of personnel, the report says.
The audit committee also “pleaded” with the management of the municipality to ensure that submission of annual financial statements should never be an issue, considering the amount of money that the municipality is spending on consultants for the compilation of the financial statements.
In her report to the North West provincial legislature, the AG said unauthorised, irregular and fruitless and wasteful expenditure were not investigated to determine if any person is liable as required. She also said that the leadership of the municipality did not enforce an ethical business culture or implement effective monitoring controls over proper record keeping, amongst other things.
The report also mentions three ongoing investigations into fraud, theft and unauthorised expenditure pertaining to the procurement of IT related services. The Hawks have been investigating fraud allegations for the past years. An independent firm, appointed by Madibeng, is investigating fraud, theft and unauthorised spending, and the Special Investigating Unit is also busy conducting an investigation.