SAA INSISTS ON FUNDING AHEAD OF ITS STATEMENTS

IN A REPORT to Parliament’s watchdog public accounts committee, SAA has insisted that it cannot submit its outstanding annual financial statements (AFS) until the government guarantees its status as a going concern through additional funding. The SAA board acknowledged in the report sent to the Standing Committee on Public Accounts (Scopa) on Monday that it had received further financial help in the Medium-term Budget Policy Statement, but said it still needs “specific commitments for its working capital requirements”, and added that “inconsistent” remarks from the government about further funding has left it in limbo. “Securing funding continues to be a challenge. SAA cannot finalise its AFS within the prescribed time until the going-concern status is confirmed. This can only currently be enabled by the shareholder through financial support in the form of additional equity capital (for working capital purposes) or issuing of guarantees in support of loan funding in a timely manner,” it added. “To date, the shareholder has not confirmed this.” At issue is SAA’s outstanding AFS for 2017/18 and 2018/19. The airline, arguably at its lowest ebb after a wage strike that cost an estimated R50 million a day, referred to the provision of the Companies Act that states an enterprise must be able to show that it will be able to pay its debts as these become due in the 12-month period following the submission of its results. “Financial statements are prepared on the basis that the entity is a going concern and will continue its operations for the foreseeable future – at least 12 months after being approved. SAA is concerned about the risk associated with a disclaimed audit opinion from the auditor-general on business operations and liquidity.” SAA infuriated members of Parliament serving on Scopa last week when it cancelled a meeting on its financial statements at short notice. | African News Agency (ANA)