SAA has been flying blind

BOARD TELLS MPS THEY DON’T EVEN KNOW IF THERE IS THEFT AT AIRLINE Carrier defends use of private bodyguards for executives at R35m for two years.

Record-keeping at South African Airways (SAA) was so bad the management and board were not aware of whether any theft of inventory occurred, MPs heard yesterday.

“The issue of whether there is theft in the organisation and if there is theft, how big is it... there is [a] serious level of concern because we don’t have the full picture here,” SAA board chairperson JB Magwaza said while briefing parliament’s standing committee on public accounts on the qualified audit opinion it received from the auditor-general.

Auditor-General Kimi Makwetu’s report, tabled in parliament last month, detailed a lack of proper record-keeping and systems to ensure accurate financial statements and a failure to take effective steps to measure or prevent irregular, wasteful and fruitless expenditure.

Magwaza said a “forensic group”, made up of several board members, had been assembled to look into the matter.

SAA chief executive Vuyani Jarana told MPs that they were trying to “tie the loop” on this. “The big part around inventory management has been around putting system in place... hence we are doing a stock count physically to reconcile SAP with Amos [SAA’s two accounting systems],” said Jarana.

“As things stand today, we cannot say stock has been stolen, we have to reconcile and ensure the two databases talk to each other.”

Although a cash injection of R10 billion into SAA by government eased some of SAA’s woes, executives stressed it remained undercapitalised.

Meanwhile, the airline defended the use of private bodyguards for executives at a reported price tag of R35 million.

Jarana said the outsourcing of security was a response to threats directed at executives looking into wrongdoing at the stateowned airline. “As early as December last year, some of the executives started receiving threats as we started executing the work of change ... on the forensic report. Those were reported accordingly to police,” Jarana said.

“At the time, I approached the board and said here is the issue of risk and taking into account the