Cape Town – Auditor-General Kimi Makwetu says he has noted a slight improvement in the audit outcomes for national and provincial departments and their entities in this year’s audit results.
He also said the number of departments with clean audits increased in the year under review compared to the previous year.
The Auditor-General said this when he released the Public Finance Management Act (PFMA) audit outcomes for the 2014/15 financial year in Pretoria on Wednesday.
He said the reason only a slight improvement was achieved was management, at 73% of the auditees, “[has] been slow to respond to the audit recommendations aimed at assisting them to improve key internal controls and addressing identified risk areas”.
“This contributed to the audit outcomes for 2014/15 only [improving] slightly since 2013/14,” said Makwetu.
The Auditor-General’s audit covers a total of 468 auditees, which include 167 national and provincial departments and 301 public entities with a total budget of R1.1 trillion for the year under review.
Makwetu said the auditees that progressed or those that managed to maintain their previous year’s positive audit outcomes did so because they stuck to the basics of clean governance.
This includes, among others, implementing plans to address deficiencies in financial controls based on commitments already made; providing effective leadership and monitoring achievement of performance targets and reviewing and monitoring compliance with key laws and legislation over financial matters.
More departments get clean audits
Announcing the main figures of the outcomes, the Auditor-General said the number of auditees that received clean audits or financially unqualified audit opinions with no findings had improved slightly from 118 (26%) in 2013/14 to 131 (28%) in 2014.
He said departments made a significant contribution to the total number of clean audits, increasing from 40 to 47, while 84 public entities received clean audits.
The Auditor-General said among the provinces, the biggest contributors to the total number of clean audits were the Free State (six auditees or 32%), KwaZulu-Natal (eight or 22%), Gauteng (19 or 54%) and the Western Cape (20 or 83%).
He said 23 of the 35 ministerial portfolios (66%) contributed to the 65 clean audits in national government.
In his report, the Auditor-General said the Economic Sectors, Employment and Infrastructure Development Cluster performed the best of the five government clusters, with 19 financially unqualified audit opinions that included five clean audits.
He said none of the seven departments in the Justice, Crime Prevention and Security Cluster obtained a clean audit, although four were financially unqualified.
More focus needed on key delivery sectors
The Auditor-General said, meanwhile, that executive authorities and monitoring departments should increase their focus on the Departments of Health, Basic and Higher Education, Public Works and Human Settlements as their audit outcomes for the year under review has regressed.
He said the combined budget allocated to these sectors is approximately half of the national budget, and said this demonstrated that this is where the bulk of the priority oversight should be directed as the greatest impact will be felt in this area.
“My message from the previous year is still relevant. There should be a focus on these departments to ensure a meaningful movement towards accurate, accountable and transparent financial and performance reporting.
“This should be underpinned by sound internal controls and good human resource management, including enhancing personal accountability and consequence management,” he said. – SAnews.gov.za
