Province getting it right

Education only blemish as other entities all receive unqualified audit opinions

THE Eastern Cape has turned the tide and emerged as one of the most improved provinces to overhaul the finances of its 10 government departments. All departments and entities with the exception of the provincial Department of Education received unqualified audit opinions from auditor-general Kimi Makwetu for the 2015-16 financial year.

This is a major improvement for the province, which had five qualified audits in the 2014-15 financial year and six the year before that.

Makwetu presented the national and provincial audit outcomes for the 2015-16 financial year in parliament yesterday.

Sound leadership and a stable political and administrative environment were listed among the reasons for the Eastern Cape’s improved audit outcomes over the past three years.

An unqualified audit is a thumbs-up from the AG that the various departments’ financial records are in a good state. It is not a reflection of the services provided by the departments.

Makwetu said the 2015-16 audit outcomes indicated that the province had made strides in dealing with qualifications and increasing the number of clean audits.

“All the provincial departments and entities received unqualified audit opinions with the exception of the Department of Education.

“There were no disclaimers or adverse opinions, for the third year in a row,” his report states.

“We commend the provincial leadership for this achievement.”

Leadership instability and poor record-keeping at Bhisho’s Department of Education were among the reasons for it receiving a qualified audit opinion.

“Although it is only one audit, the budget allocated to [Education] represents 45% of the total budget allocation to the province.

“Instability in leadership, including acting personnel at head of department and senior management levels, resulted in a lack of accountability, a lack of good governance and a weak control environment at this department.

“In addition, there was a lack of monitoring and coordination between the head office and district offices, poor record-keeping practices and failure to adequately implement action plans to address the previous year’s audit findings.

“These factors contributed to repeat qualifications and findings on performance reporting and compliance.”

The audit revealed significant differences between the number of pupils captured on the computer systems and the physical verification of pupils.

“These differences had an impact on the reliability of the reported performance and the disclosure of fruitless and wasteful expenditure in the financial statements of education.”

He raised concerns where there was no action taken against some officials found to have been responsible for irregular, fruitless and unauthorised expenditure.

Provincial government spokesman Sizwe Kupelo said it was the cool-headed leadership style of premier Phumulo Masualle which led to the good audit outcomes.

“This is a positive reflection of good governance in the province,” Kupelo said.

“Clearly we are turning the corner, but it has to be sustained going forward.”

The education and health departments had improved from a few years ago, when they received disclaimers and adverse audit opinions, he said.