De­part­ment tak­ing the au­di­tor-gen­eral to court

It’s not will­ing to ob­tain an un­qual­i­fied au­dit out­come

Cape Argus - - METRO - JA­SON FE­LIX ja­son.fe­lix@inl.co.za

THE West­ern Cape De­part­ment of Eco­nomic Op­por­tu­ni­ties is tak­ing the au­di­tor-gen­eral to court seek­ing an or­der re­view­ing and set­ting aside dis­puted find­ings, which should re­sult in the de­part­ment ob­tain­ing an un­qual­i­fied au­dit out­come.

Eco­nomic Op­por­tu­ni­ties MEC Alan Winde’s spokesper­son, Bianca Ca­pa­zo­rio, said: “I can con­firm that the West­ern Cape De­part­ment of Eco­nomic Op­por­tu­ni­ties will be chal­leng­ing the AG mat­ter in court. Pa­pers will be served shortly, but a spe­cific day has not been iden­ti­fied.”

The de­part­ment will be ap­proach­ing the West­ern Cape High Court for an or­der re­view­ing and set­ting aside the dis­puted find­ings and ask that the au­di­tor-gen­eral ap­ply the ap­pli­ca­ble stan­dards cor­rectly, which should re­sult in an un­qual­i­fied au­dit out­come.

The au­di­tor-gen­eral’s of­fice re­quested the de­part­ment to al­ter its record­ings of pay­ments of R266 mil­lion to Casidra and Hort­gro, from trans­fer pay­ments to goods and ser­vices, be­fore it could give an opin­ion on the de­part­ment’s 2016/2017 au­dit.

The en­ti­ties pro­vide ser­vices on be­half of the de­part­ment to farm­ers and com­mu­ni­ties that range from flood and drought re­lief to pro­grammes that sup­port emerg­ing farm­ers.

Ca­pa­zo­rio said the mat­ter boiled down to a dif­fer­ence in tech­ni­cal in­ter­pre­ta­tions between the De­part­ment of Agri­cul­ture and the of­fice of the au­di­tor-gen­eral re­gard­ing the au­di­tor-gen­eral’s find­ings in re­spect of the de­part­ment’s clas­si­fi­ca­tion of cer­tain pay­ments made to en­ti­ties in­volved in farmer set­tle­ment and disas­ter re­lief projects in the West­ern Cape.

“To con­firm, the fi­nances of the de­part­ment have not gone unau­dited; rather, there has been a de­lay in the re­lease of the AG’s fi­nal au­dit re­port for the 2016/2017 fi­nan­cial year end, due to the above mat­ter. The dis­pute re­lates to find­ings in both the 2016/17 and 2017/18 au­dit re­ports. The de­part­ment and the au­di­tor-gen­eral’s of­fice have been en­gag­ing on the mat­ter for some time but have been un­able to find com­mon ground. The de­part­ment has de­cided to ap­proach the West­ern Cape High Court for re­lief. It is an­tic­i­pated that its ap­pli­ca­tion will be launched soon,” she said.

Ca­pa­zo­rio also said there were con­tracts in place between the de­part­ment and the in­sti­tu­tions (Casidra and the De­cid­u­ous Fruit Pro­duc­ers Trust), and his­tor­i­cally, pay­ments have been made, and clas­si­fied, in the de­part­ment’s fi­nan­cial state­ments as trans­fers with­out any ad­verse au­dit find­ings at all.

“How­ever, there was a re­cent change in the AG’s ap­proach and in­ter­pre­ta­tion of the rel­e­vant stan­dards, which has re­sulted in un­ex­pected ad­verse find­ings in the au­dit re­ports in­volved. The De­part­ment of Agri­cul­ture dis­agrees with the au­di­tor-gen­eral’s in­ter­pre­ta­tion and wishes to chal­lenge the find­ings in a for­mal fo­rum, as it is en­ti­tled to do,” she said.

The au­di­tor-gen­eral has pre­vi­ously said the re­quest for a change in the de­part­ment’s fi­nan­cial records came after new ac­count­ing stan­dards were put in place and re­quired the pay­ment be changed from trans­fer pay­ments to goods and ser­vices.

Se­nior com­mu­ni­ca­tions head at the au­di­tor-gen­eral’s of­fice, Africa Boso, did not re­ply to mes­sages sent via email yes­ter­day.

Pa­pers will be served very shortly, but a spe­cific day has not been iden­ti­fied for this to be done

MEC Alan Winde’s spokesper­son

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