Most municipal finance officers lack the right qualifications and Councils must sack them after two successive disclaimers, said Deputy Minister of Co-operative Governance Obed Bapela.
Most municipal finance officers lack the right qualifications and Councils must sack them after two successive disclaimers, said Deputy Minister of Co-operative Governance Obed Bapela.
He was speaking at the Makana Service Delivery Summit a week ago, where alarm was expressed at a fourth disclaimer for Makana Municipality.
Bapela said there would be consequences for municipalities that received repeated disclaimers. Administrator Pam Yako broke the news about Makana when she tabled the draft 2013/14 AG report at the ordinary council meeting 4 December.
Council resolved to invite the office of the auditor general to visit the council and explain how to make improvements.
During a media briefing, Bapelo was asked if there are any consequences for municipalities that receive poor audits. He said the department had embarked on the 'back to basics' programme launched on 18 September by President Jacob Zuma.
"We have asked all municipalities to give us an audit of their Chief Financial Officers (CFOs); who are the people and what qualifications they have," said Bapela. He said they were shocked to find that most municipalities employ people who are unqualified.
"The results were shocking. Almost over 80% of their CFOs do not have the right qualifications and skills to be handling those matters of finance and accounting."
Makana is one of the municipalities that has struggled to retain qualified senior managers. In January 2013 Makana employed Danny Sahibdeen as Chief Financial Officer – only for him to resign in July.
After a few months the municipality suspended then municipal manager Pravine Naidoo. The municipality's finances went into a downward slide, which led them to seek help from the provincial government.
This help has come in the form of managed grants, and the appointment of administrator Pam Yako. Bapela feels that if people cannot do the job and continue to get disclaimers year in and out, they should do the honourable thing and vacate their positions.
"We have said to the councils that are concerned to fire them. Anyone who continues to get a disclaimer year in year out must really resign voluntarily, to say, 'I have failed,'" Bapela said.
According to the AG's report the municipality has been a defendant in a number of lawsuits estimated at R60.1-million during the year under review (2013/14) and litigation is still in progress.
"The financial statements were presented for auditing purposes without accurate and complete underlying accounting records," the report reads.
The AG also draws attention to performance management in Makana. "The performance management system and related controls were inadequate as they did not describe and represent process of performance planning, monitoring… including roles of different role players as required by the Municipal Systems act," the draft report reads.
The council hopes to get a detailed report on the audit findings from the office of the auditor general. Council resolved to ask the AG to visit the municpality in January.
