It was a day of applause and jubilation yesterday at a Buffalo City Metro council meeting as mayor Xola Pakati officially announced that the city had obtained an unqualified audit opinion from the auditor-general for the 2016-17 financial year –an improvement for the metro but it still has a long way to go to obtaining a clean audit opinion.
A proud Pakati said the annual report tabled in council yesterday was the first full report of the work of the current council which had assumed office in August 2016, just over a month after the beginning of the financial year.
According to the auditor-general an unqualified audit opinion means: “The financial statements contain no material misstatements. Unless we express a clean audit outcome, findings have been raised on either reporting on predetermined objectives or non-compliance with legislation, or both these aspects.”
Although this was not a clean audit opinion, council speaker Alfred Mtsi said this was still a huge achievement considering BCM’s bad history of “disclaimer” and “qualified” audit opinions.
Pakati said the city’s results reflected an improvement on the prior year and continued focus by the institution on good governance.
“Stringent measures have been implemented to strengthen political oversight, especially over irregular expenditure. The municipality continues to reflect a positive credit risk. Despite the current economic climate, the municipality managed to maintain its investment grade credit of A in the long term and A1 in the short term with a positive outlook,” Pakati said.
“During the financial year under review the municipality has seen profound performance on the service delivery front. We have made advances in providing the prescribed basic services per household, as it relates to water and sanitation. This has included making the necessary provision for informal settlements in the interest of increasing access to services for all citizens of BCM,” Pakati added.
During his summary of the annual report, Pakati highlighted that sanitation provision had improved in recent years and the number of households with access to basic sanitation services had increased drastically especially in the rural areas and informal settlements.
“Access to sanitation service has improved from 87% (2014-15) to 91% (2016-17). The municipality has also electrified some 5000 informal houses, since this programme started, with a metered electricity supply which will see a reduction of illegally connected electricity supplies,” said Pakati.
Eastern Cape auditor-general Sithembele Pieters warned that the results had other “important matters” (findings).
He said key matters that needed fixing in the metro included irregular expenditure. He said there was R2.1-billion relating to the previous years and R287-million relating to the previous financial year.
“The R2.1-billion incurred in the previous years was the responsibility of this council to have investigated, possibly recover or write it off. There must be an improved strategy around the collection from debtors because in the long run it might affect the financial sustainability of the municipality,” said Pieters.
He warned BCM that it was easy to regress and said BCM should work towards a clean audit opinion. — mamelag@dispatch.co.za
Jubilation as Pakati-led metro improves its audit
A proud Pakati said the annual report tabled in council yesterday was the first full report of the work of the current council which had assumed office in August 2016, just over a month after the beginning of the financial year.
According to the auditor-general an unqualified audit opinion means: “The financial statements contain no material misstatements. Unless we express a clean audit outcome, findings have been raised on either reporting on predetermined objectives or non-compliance with legislation, or both these aspects.”
Although this was not a clean audit opinion, council speaker Alfred Mtsi said this was still a huge achievement considering BCM’s bad history of “disclaimer” and “qualified” audit opinions.
Pakati said the city’s results reflected an improvement on the prior year and continued focus by the institution on good governance.
“Stringent measures have been implemented to strengthen political oversight, especially over irregular expenditure. The municipality continues to reflect a positive credit risk. Despite the current economic climate, the municipality managed to maintain its investment grade credit of A in the long term and A1 in the short term with a positive outlook,” Pakati said.
“During the financial year under review the municipality has seen profound performance on the service delivery front. We have made advances in providing the prescribed basic services per household, as it relates to water and sanitation. This has included making the necessary provision for informal settlements in the interest of increasing access to services for all citizens of BCM,” Pakati added.
During his summary of the annual report, Pakati highlighted that sanitation provision had improved in recent years and the number of households with access to basic sanitation services had increased drastically especially in the rural areas and informal settlements.
“Access to sanitation service has improved from 87% (2014-15) to 91% (2016-17). The municipality has also electrified some 5000 informal houses, since this programme started, with a metered electricity supply which will see a reduction of illegally connected electricity supplies,” said Pakati.
Eastern Cape auditor-general Sithembele Pieters warned that the results had other “important matters” (findings).
He said key matters that needed fixing in the metro included irregular expenditure. He said there was R2.1-billion relating to the previous years and R287-million relating to the previous financial year.
“The R2.1-billion incurred in the previous years was the responsibility of this council to have investigated, possibly recover or write it off. There must be an improved strategy around the collection from debtors because in the long run it might affect the financial sustainability of the municipality,” said Pieters.
He warned BCM that it was easy to regress and said BCM should work towards a clean audit opinion. — mamelag@dispatch.co.za
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