SA Bureau of Standards reduces net loss by 94%

Moneyweb

The South African Bureau of Standards (SABS), which was placed under administration in June last year, reduced its net loss by almost 94% to R4.4 million in the year to March from the net loss of R70.7 million in the previous year.

The operating loss for the year was offset by net interest income earned on investments of R30.1 million compared to R29.1 million in the prior year.

The overall operating loss for the year reduced by 56.7% to R34.4 million.

Revenue from services declined by 2.6% to R501.3 million from R514.4 million while benefits from cost management initiatives contributed to a 5.9% reduction in total operating expenditure to R847.8 million.

Garth Strachan, the acting chief executive of SABS, said although the bureau had produced better results, the outlook for the next financial year remained challenging.

Strachan said the SABS would continue to consider options to return to profitability.

The bureau received a qualified audit from the Auditor-General for several reasons, including irregular expenditure.

Confirmed irregular expenditure amounted to R11.79 million compared to R3.1 million in the previous year.

The SABS said confirmed irregular expenditure related to amounts that had been investigated, with disciplinary proceedings against the individuals concerned underway.

But Auditor-General Kimi Makwetu said his office was unable to obtain sufficient appropriate audit evidence that all irregular expenditure incurred was identified and disclosed.

Group bad debts written off rocketed to R35.4 million from R6.67 million.

Contingent liabilities rose to R45.5 million from R5.1 million and were partly due to alleged negligence in testing products.

Strachan said a further deficit was currently projected for the SABS in its 2019/20 financial year but the bureau would continue to invest in the refurbishment and replacement of essential equipment and the filling of critical human resources.