The municipality has received another unqualified audit opinion from the Auditor General for the third consecutive year.

THE Ekurhuleni Metropolitan Municipality (EMM) has received yet another unqualified audit opinion from the Auditor General of South Africa (AGSA) for the third time in as many years. The city received the same status in 2008/2009, again in 2009/2010 and the last financial year – 2010/11.

“It gives me great pleasure to report that once again we have received a clean bill of financial health from the Auditor-General for the 2010/2011 financial year,” announced an elated executive mayor Mondli Gungubele.

“A lot of hard work went into ensuring that we maintain this status and we shall continue working very closely with the AG’s office to improve on our handling of public funds as a city.”

This unqualified audit opinion contains certain matters of emphasis though. These revolve around Supply Chain Management lapses, ICT and Human Resources-related concerns, few housekeeping issues in respect of performance, as well as long-term liquidity concerns due to water and electricity losses. There is also the issue of a high debt being written off, Gungubele added.

“However, we are now zooming into these and a strategy to make them a thing of the past is already in place and this will include the quarterly review sessions to monitor the internal control environment.”

“The Mayoral Committee has directed the senior management of the City to set timeframes by which we anticipate to have resolved all the areas of the AG’s concern.”

On 14 July 2009 the Minister for Cooperative Governance and Traditional Affairs introduced the launch of Operation Clean Audit 2014. The strategic vision and objective of the project is that by 2014 all municipalities will have achieved clean audits on their financial statements and that by 2011 all municipalities must have dealt or cleaned disclaimers and adverse opinions.

“The Ekurhuleni Metro has come a long way in the past few years in moving towards a ‘clean’ audit opinion, as is evident now. Among our efforts was the establishment of a committee in the previous financial year, namely the Operation Clean Audit (OPCA) Steering Committee,” explains the metro’s Chief Financial Officer Zakes Myeza.

“This dramatically enhanced the OPCA Project, which has been running for a few years already. The mission and objective of the steering committee is to oversee the OPCA project on a strategic level in order to ensure, as far as possible, a clean audit report/opinion as soon as possible.”

One of the steering committee’s first objectives was to resolve all matters that would normally lead to qualified audit reports in the past, as well as to fast track efforts in addressing identified risk areas.  This meant improved in internal controls, quality controls of financial reporting, record keeping, revenue enhancement, compliance with relevant legislation, further risk identification etc.

In addition to this, a number of key controls were identified which are being monitored on a monthly basis. These controls enable EMM to identify possible problem areas and implement corrective measures to resolve it timeously.

The current financial year is already halfway through, but if the previous two financial years are anything to go by, EMM will not disappoint in its efforts to maintain the best possible audit outcome in the years to follow, concludes Myeza.

Meanwhile, after interrogating the National Treasury report on the state of finances of municipalities the City of Ekurhuleni has come to a different conclusion than that of the national department which painted a picture that the city was in a financial distress.

“Using the finalized audited financial statements the picture immediately points to a positive situation confirming that at this juncture, and nowhere in the near future Ekurhuleni is not in a financial distress,” explains Myeza, adding that the city used the same variables as used by National Treasury, but the only difference was that it was on the audited financial statements instead of the unaudited ones used by treasury.

Source: www.ekurhuleni.gov.za