Despite the 10th disclaimer in a row from the auditor general, the City of Johannesburg is improving its financial reporting, the mayor’s office said on Wednesday.
The auditor general’s draft opinion (which has not yet been signed) awarded nine of the 15 operating entities a clean audit report — four more than last year.
However, City Power, Johannesburg Water and core administration all received disclaimers — meaning the statements were in too much of a shambles for the auditor general to express an opinion.
The financial statements were presented to council on Wednesday.
Democratic Alliance councillor John Mendelsohn said many of the issues raised by the auditor general in previous years had not been addressed.
He said the city’s inability to gain even a qualified audit is because lax officials are not disciplined.
However, African National Congress finance councillor Parks Tau said there are good reasons for the delay in getting a clean audit.
Many city properties are still not on the billing system, and although the city has increased its billing by R11-million a month, the revenue is still not complete, he said.
The city is also postponing the evaluation of its fixed assets, said Tau, because the entire city is to be evaluated in the next two years.
He said the city has changed its target of Operation Clean Audit and is now aiming for a qualified report by next year.
The DA was not satisfied, and pointed out that until the ANC came to power in 1994 the city had always obtained unqualified audits.
”The financial controls of council remain inadequate. Corruption could be taking place and the council would not be aware of it,” said councillor Mike Moriarty, leader of the DA in the city.
Of the other six metropolitan councils, only Ethekwini (Durban) got an unqualified audit last year. Cape Town also received a disclaimer, the Ekurhuleni metropolitan council (East Rand) submitted its statements too late to be audited, and the others were given qualified opinions.
Despite the disclaimer, the city is in a good financial position and is operating at a surplus, said city manager Pascal Moloi. Capital expenditure (Capex) continued to increase and the city is aiming for a Capex of more than R2-billion next year.
”Gone are the days of the financial crisis of 1997. We have steadily been improving our books since then,” he said. — Sapa