The mandated audit reports of several municipalities in the Western Cape have been delayed due to several risks, arson and non-submission, among other reasons.
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According to the Office of the Auditor General (AGSA), some letters explain the delays in submitting the audit reports on the financial statement for the Swellendam, Kannaland, Overstrand, Cederberg, Matzikama and Laingsburg local municipalities. In addition, the audit report for the Central Karoo District Municipality is also delayed.
As per the Daily Maverick, these reports were meant to be completed by 30 November.
Swellendam’s delays are linked to protests that occurred in August and September. In her letter to the municipality, Sangeeta Kallen (AGSA business unit leader for the Western Cape) wrote that this delay was expected.
‘Swellendam municipality submitted their financial statements on 30 September following an act of arson during community protest action resulting in significant damage to the main municipal building, which housed the finance department.’
Cape {town} Etc previously reported that the municipal building was burned down during service delivery protests in August.
Further compounding the challenge is the closure of the AG’s office between 14 December and 7 January 2024, reducing the number of days available for the three-month audit period.
Kallen wrote that the AG will aim to finalise Swellendam Municipality’s report by 31 January 2024 to ‘enable the completion of the necessary oversight processes’. The municipality received a clean audit during the previous financial year.
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Matzikama Municipality was also notified that its audit report would not be ready by 30 November. According to the AG’s office, the delay was attributed to issues identified during the audit process.
This includes internal quality control and review processes. The Daily Maverick reports that the initial goal was to have the audit completed by 8 December. The same reasons were given for the delay at Overstrand Municipality, which had the same completion date.
Furthermore, the completion date for the Central Karoo District Municipality’s audit report was 4 December. However, Kallen wrote that delays were due to ‘internal quality control and review processes to ensure that risks identified during the audit process [are] adequately addressed have delayed the audit sign’.
The same reason was given for the delays at Cederberg Municipality, whose report was due to be finalised by mid-December.
Laingsburg’s audit delay was given as ‘the adverse audit opinion expressed in the prior year, and the extent of misstatements identified in the current year has placed significant constraints on [the] capacity at the municipality to timeous respond to the completion of the audit.’ In her letter to the Laingsburg Municipality, Kallen wrote that the report was due by 1 December.
‘The [audit delay] will allow the municipality to use its current capacity to respond to findings regarding misstatements identified and the related information requests to conclude the audit.’ Kallen added that the AGSA aimed to finalise the audit report by 14 December.
The Daily Maverick further states that the Kannaland Municipality is known for its bad audit figures. It also reportedly submitted its financial statements nearly two months after the deadline.
Kallen wrote that at the time of the above submission, ‘resources were already allocated and committed to other MFMA audits’.
‘Furthermore, a decision was taken by the Auditor-General of South Africa to delay the execution of the audit to facilitate the use of internal resources to ensure that the complexities associated with the audit are adequately addressed.’
To this end, the AGSA plans to complete the Kannaland audit by 31 March 2024.
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