Get more Mail & Guardian
Subscribe or Login

Auditor General: Irregular spend at ‘all-time high’

Auditor General Kimi Makwetu has lamented poor financial controls in the public sector that lead to irregular expenditure, saying the scourge has reached an “all-time high”.

Speaking at The Banking Summit, Makwetu said the rising rate of irregular expenditure called for stricter regulation that would empower his office to deal more harshly with transgressors and help boost compliance.

“There is a glaring absence of consequence for all wrongdoing, which has given rise to calls to expand the mandate of the Auditor General,” he told delegates.

“Irregular expenditure is at an all-time high…we are not in a good place.”

AG’s recommendations ‘ignored’

President Cyril Ramaphosa is currently studying the Public Audit Amendment Bill, which seeks to expand the mandate of the Auditor General.

The legislation would compel accounting officers at government departments and entities to adhere to the office’s recommendations.

According to Makwetu, irregular expenditure at local government accelerated from R4-billion in 2010/11 to more than R16-billion in the 2016/2017 financial year.

At national level, the rate jumped from R11-billion to around R50-billion.

“People are ignoring the recommendations that are made by the Attorney General,” said Makwetu.

Irregular spend that’s ‘worrying, systematic’

He said the legislation would empower the office to find those involved in allowing irregular expenditure financially liable.

According to Makwetu, there are instances where errors may genuinely be made, but he stressed that at other times, irregular expenditure “becomes systematic and grows at an exponential rate…and that raises a worry”.

In his 2016/17 report, the Auditor General revealed that only 33 municipalities out of 257 had managed to produce financial statements and performance reports of an acceptable standard, and received clean audits. Only 22% of municipalities managed to provide financial statements without material misstatements.

In his address, Makwetu also highlighted the recent reputational crisis suffered by the auditing profession, particularly the KPMG, VBS and Steinhoff accounting failures.

He said the sector could learn from the banking sector when it came to regulation. — Fin24

Subscribe for R500/year

Thanks for enjoying the Mail & Guardian, we’re proud of our 36 year history, throughout which we have delivered to readers the most important, unbiased stories in South Africa. Good journalism costs, though, and right from our very first edition we’ve relied on reader subscriptions to protect our independence.

Digital subscribers get access to all of our award-winning journalism, including premium features, as well as exclusive events, newsletters, webinars and the cryptic crossword. Click here to find out how to join them and get a 57% discount in your first year.

Related stories

WELCOME TO YOUR M&G

If you’re reading this, you clearly have great taste

If you haven’t already, you can subscribe to the Mail & Guardian for less than the cost of a cup of coffee a week, and get more great reads.

Already a subscriber? Sign in here

Advertising

Subscribers only

Fears of violence persist a year after the murder of...

The court battle to stop coal mining in rural KwaZulu-Natal has heightened the sense of danger among environmental activists

Data shows EFF has lower negative sentiment online among voters...

The EFF has a stronger online presence than the ANC and Democratic Alliance

More top stories

Eastern Cape premier Mabuyane lives large amid province’s poverty

Oscar Mabuyane and MEC Babalo Madikizela allegedly used a portion of state funds for struggle icon Winnie Madikizela-Mandela’s commemoration for their own benefit

Constitutional court confirms warrantless searches in cordoned off areas unconstitutional

The law was challenged in response to raids in inner Johannesburg seemingly targeting illegal immigrants and the highest court has pronounced itself 10 days before an election in which then mayor Herman Mashaba has campaigned on an anti-foreigner ticket

A blunt Mantashe makes no promises during election campaigning

ANC chairperson Gwede Mantashe told people in Daveyton to stop expecting handouts from the government

Mbeki: Social compact the answer to promises made in ANC...

Former president Thabo Mbeki urged business and government and society to work together to tackle issues such as poverty, unemployment and poor services and infrastructure
Advertising

press releases

Loading latest Press Releases…
×