Outgoing Auditor General Shauket Fakie has lashed out at municipalities that have again failed to submit timeous financial statements for the financial year ended June 30 2005.
”The key attributes of good governance are accountability and transparency, which are achieved through the timely submission of financial statements and audit reports,” he said in his last quarterly report tabled in Parliament on Monday.
Only 126 — 44% — of the 284 municipalities complied with the August 31 2005 deadline for submitting their 2004/05 financial statements, he said.
Originally, 159 municipalities met the deadline as prescribed by the Municipal Finance Management Act (MFMA). However, 33 financial statements were subsequently withdrawn mainly due to material errors in the statements submitted.
Between September 1 2005 and June 30 2006, 141 municipalities had submitted their annual financial statements. These statements were regarded as late submissions, as were statements submitted by August 31 2005, but subsequently withdrawn and resubmitted.
A total of 17 of the 284 municipalities had not submitted financial statements by June 30 2006.
Fifteen had not submitted any financial statements, while the statements of two municipalities had been withdrawn and were not resubmitted by June 30 2006.
Fakie said the MFMA also requires that municipalities with municipal-owned entities prepare consolidated annual financial statements incorporating the annual financial statements of the municipality and its entities.
There are currently 20 municipalities with control of municipal-owned entities. Of the 20 municipalities, only four submitted consolidated annual financial statements by September 30 2005, while three submitted consolidated financial statements between October 1 2005 and June 30 2006.
By June 30 2006, 13 municipalities — 65% — had not submitted consolidated financial statements.
”There has been little change from my previous report. The slow rate at which consolidated financial statements are submitted for auditing is a matter of serious concern,” Fakie said.
”Receiving the financial statements after the set deadline not only impacts on the ability of my office to perform its function in this regard, but could [also] impact on the ability of the municipality to perform within the accountability framework,” he said. — Sapa