Office of the KZN Premier - Auditor General heaps praises on KwaZulu-Natal
Office of the KZN Premier - Auditor General heaps praises on KwaZulu-Natal



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Office of the KZN Premier - Auditor General heaps praises on KwaZulu-Natal

2016-11-17

KwaZulu-Natal Premier Willies Mchunu has welcomed, unreservedly, the report of the Audit Outcomes as presented by the by the Auditor-General Kimi Makwetu.
Mchunu remarked: “We have been waiting for this report for weeks. We are excited that there is marked improvement in the overall management of finances in the province as pointed out by the AG and his team of competent and dedicated professionals.”

“There are two main reasons why we are excited following the release of this report. Firstly, it is a well-known fact that a clean bill of health not only attracts investors, but it also improves the public image of government.”

“Secondly, as the provincial government we always want to see whether we are making progress towards achieving clean audit. When we started the previous term of office, we launched Operation Clean Audit. We stated categorically that all municipalities and provincial government departments must achieve unqualified audit opinions.”

“The 2015/16 audit report indicates positive outcomes when compared to the 2014/15 audit outcomes:
- Twelve (33%) auditees recorded unqualified audits with no findings
- Seventeen (47%) auditees recorded unqualified with findings
- Four (11%) auditees qualified with findings

“The department of Education progressed to an unqualified opinion with findings from a qualified audit opinion for the first time in 5 years.”

“We are particularly happy that unauthorised expenditure decreased over 3 years. We have also noted slight improvement since the previous year in the number of auditees with no material findings on compliance with key legislation.”

“The AG has also pointed out that there has been a reduction in unauthorised expenditure, irregular expenditure and fruitless and wasteful expenditure.”

“We welcome further improvements in the submission of financial statements. The AG has also pointed out in the report that financial statements are of top quality.”
“As we move forward, all members of the executive council, Heads of departments, CEOs and senior managers will provide leadership to ensure adherence to best financial management practices on a daily basis.”

“In addition, the executive council will issue a firm directive that all government departments and municipalities to work with the AGs office on an on-going basis to detect early signs of administrative or financial distress.”

“We will aggressively promote a culture of effective risk management in all government departments. In this regard, we will establish risk management teams that will provide oversight in areas vulnerable to corrupt practices such as supply chain management units.”

“We will ensure that the Provincial Treasury enforces compliance with the KZN Supply Chain Management policy when procuring goods and services.”

Issued by the Office of the Premier
Enquiries
Ndabezinhle Sibiya: Spokesperson for the Premier
082 375 4742

Media statement by the Premier of the Province of KwaZulu-Natal following the release of the Audit Outcomes Report by the Auditor General

16 November 2016

Pietermaritzburg: KwaZulu-Natal Premier Willies Mchunu has welcomed, unreservedly, the report of the Audit Outcomes as presented by the by the Auditor-General Kimi Makwetu today.

Mchunu remarked: “We have been waiting for this report for weeks. We are excited that there is marked improvement in the overall management of finances in the province as pointed out by the AG and his team of competent and dedicated professionals.”

“There are two main reasons why we are excited following the release of this report. Firstly, it is a well-known fact that a clean bill of health not only attracts investors, but it also improves the public image of government.”

“Secondly, as the provincial government we always want to see whether we are making progress towards achieving clean audit. When we started the previous term of office, we launched Operation Clean Audit. We stated categorically that all municipalities and provincial government departments must achieve unqualified audit opinions.”

“The 2015/16 audit report indicates positive outcomes when compared to the 2014/15 audit outcomes:
•             Twelve  (33%) auditees  recorded unqualified audits with no findings
•             Seventeen (47%) auditees recorded  unqualified with findings
•             Four (11%) auditees qualified with findings

“The department of Education progressed to an unqualified opinion with findings from a qualified audit opinion for the first time in 5 years.”

“We are particularly happy that unauthorised expenditure decreased over 3 years. We have also noted slight improvement since the previous year in the number of auditees with no material findings on compliance with key legislation.”

“The AG has also pointed out that there has been a reduction in unauthorised expenditure, irregular expenditure and fruitless and wasteful expenditure.”

“We welcome further improvements in the submission of financial statements. The AG has also pointed out in the report that financial statements are of top quality.

“Of concern is the continuous recording of qualified audit opinions and a disclaimer. According to the AG there were:-
  • One (3%) auditees disclaimed with findings (The Business Rehabilitation Trust Fund.
  • Two (6%) auditees with outstanding audits
The AG also pointed out that fruitless and wasteful expenditure increased over 3 years. Litigation and claims caused 94% of the fruitless and wasteful expenditure.

Our Response as Government

I wish to report to the public at large that a Team has been established in the Office of the Premier to work with The Provincial Treasury Financial Management Unit.
This team will assist all qualified departments and entities. These include the 1 entity that received a disclaimer.

The following qualified departments are being assisted:
•             Health
•             Transport
•             Human Settlement
•             Mjindi Farming
•             Rehabilitation Trust Fund

The Auditor General has identified the following Root Causes of poor audit outcomes:-

Slow response by senior management in implementing effective and sustainable internal controls that support credible financial and performance information and ensure compliance;

Instability or vacancies in key positions, including those of the CFO , head of SCM and head of monitoring and evaluation;

Key officials not held accountable for poor performance

“As we move forward, all members of the executive council, Heads of departments, CEOs and senior managers will provide leadership to ensure adherence to best financial management practices on a daily basis.”

“In addition, the executive council will issue a firm directive that all government departments and municipalities to work with the AGs office on an on-going basis to detect early signs of administrative or financial distress.”

“We will aggressively promote a culture of effective risk management in all government departments. In this regard, we will establish risk management teams that will provide oversight in areas vulnerable to corrupt practices such as supply chain management units.”

“We will ensure that the Provincial Treasury enforces compliance with the KZN Supply Chain Management policy when procuring goods and services.”

Ends
Issued by the Office of the Premier

Enquiries
Ndabezinhle Sibiya: Spokesperson




Office of the KZN Premier - Auditor General heaps praises on KwaZulu-Natal

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