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ETEs show a lack of dominant control

Maybe solely the highest 20 government models within the state ought to have ensured that their financial management was clear earlier than they met President Cyril Ramaphosa last week.

Then they might not have

Learn: The Relationship Between IY and the President

For the sake of transparency, I feel it was sensible to disclose the important thing findings of the newest external audit studies. the financial statements of these state-owned corporations. Some of them have been discussed in a state abduction survey, however this text only applies to the 2018 external audit reviews.

Our corporations have shown that they’re very expert at ignoring nationwide Treasury laws and breaking public finance (PFMA) and the Corporations Act. State-owned corporations that have met with the President have misplaced irregular expenditure to at the least R178.5 billion by 31 March 2018.

This is an indication of how the South African authorities has utterly lost all control over these communities.

Irregular Expenses

Audit Report







doesn’t control the results for IE, ongoing investigations in IE: and supply chain management.




Reported Irba to report irregularities, incorrect procurement processes, related and full data not reported, no consequence administration



No [19659009] Inspection and monitoring processes weren’t adequate to stop IE




Not enough related audit evidence to verify all IE, some essential misunderstandings not corrected, effective measures , which were not taken to stop IE and F&WE, credit cards that have not been used for approved functions, without any consequence administration, vital inner control weaknesses

Central Power Fund (CEF)



The irregularities have been corrected and the Courtroom's opinion was subsequently absolute. IE has no penalties administration




Correction of material misunderstandings




AG could not categorical his opinion. He was unable to acquire adequate audit documentation as a foundation for the audit report. Continuity includes substantial uncertainty. Financing was not submitted inside the deadline. Denel violated IFRS, PFMA and the Corporations Act. No penalties. Violations of procurement and contract management. Internet Loss 2018 R1.eight billion




R143 million infertile and wasteful spending. Essential uncertainty associated with business continuity. Reported irregularities have been reported to Irba. The entire loss for the financial yr is R6.6 billion. No consequence administration. Violations of procurement and contract management. Personal business interests not disclosed




Land Financial institution






AG could not categorical his opinion. He was unable to obtain enough audit documentation as a basis for the audit report. The financial figures couldn’t be verified. Brief-term liabilities exceed current belongings by R153 million. The management did not present AG with adequate applicable audit certificates to help the going concern assumption. Irregular expenditure not shown within the notes. Substantial impairment of investments in subsidiaries was R134 million.


2 463


Materials uncertainty associated to enterprise continuity. Internet loss was EUR 666 million. Impairment of tangible fastened belongings (PPE) R240 million. Impairment of investments in subsidiaries amounted to EUR 1.2 billion. The price range didn’t obtain a legitimate opinion because the irregularities have been corrected.


25 200


Materials uncertainty related to business continuity. Didn't you’ve a enough system to determine IE and wasteful expenditures and never tangible belongings. Adequate applicable evidence cannot be obtained. Internet loss R924 million. The administration only corrected some misguided stories in the efficiency reporting, and AG made vital observations on the usefulness and reliability of the reported performance knowledge. PFMA was breached as a result of the monetary statements weren’t submitted for evaluation inside two months after the top of the monetary yr.

Rand Water



Abuse is corrected to make the assertion unobtrusive. Most of this IE is because the group is just not capable of respond periodically to laws and practices.

Procurement revealed by the Ministry of Finance.

SA Categorical



Only the 2016 Annual Report is out there. AG report legitimate. IE just isn’t measurable. The group didn’t have adequate system to determine and determine all IEs. Dazzling Bills: R 30.6 million


113 600


Only the 2017 Annual Report is on the market. The Stabilization and Affiliation Settlement Group did not set up adequate checks to protect full info on IE. A legitimate report was based mostly on inadequate methods for real property, plane and gear, inventory, maintenance prices, IE and wasteful spending. In 2017, the web loss was R5,569 billion and liabilities exceeded their stability sheet by R17,801 billion. Fruitful and wasteful spending: R42.6 billion




Internet loss R621.6 million. Liabilities exceeded belongings by EUR 291.6 million. The unit was commercially bancrupt. You can’t take into consideration all the PPE. AG is unable to acquire adequate applicable evidence from the EPP and lots of different economic figures.




All IE was not saved. There were many accounting errors, and the figures for earlier durations needed to be revised. Nevertheless, no help info was offered, so all needed adjustments could not be made.



Accrued loss is R14.5 billion.

SA Publish Office



Material Uncertainty Related to Business Continuity. Yr R908 million. Collected loss of R3.3 billion.

Trans-Caledon Tunnel Authority



Efficient and applicable measures were not taken to stop IE. Some of the products, works or providers procured by the general public entity weren’t procured by way of a truthful, equitable, open, cost-effective and aggressive procurement process.

No Impression Management




The external auditor was unable to obtain enough applicable audit proof to verify IE. the usefulness and reliability of reported efficacy knowledge. PFMA was breached because the monetary statements weren’t submitted for evaluation within two months after the top of the financial yr. Vital inner control weaknesses. Applicable danger management measures weren’t taken

Umngeni Water



178 527

It ought to be noted that an unqualified assertion does not, for my part, exempt a company from violating IFRS and PFMA. If an exterior auditor detects irregularities and is subsequently corrected, a statement shall be issued without notice. There’s additionally no legitimate opinion on "material uncertainty" related to the continued existence of the group

Hall of Shame: forensic investigations and litigation

Some corporations in the spotlight are beneath investigation

In Alexkor's case, the Minister of Finance has launched a research suspected misconduct on a diamond advertising supply to a provider.

CEF is a defendant on a number of legal issues, an important of that are the Courtroom's software to refuse the switch of crude oil stocks on the grounds that they have been illegal, invalid and unconstitutional. An unbiased advisor is investigating legal investigations into issues associated to the assessment of contracts by the strategic gasoline fund association NPC, a subsidiary of CEF


Petro SA is obliged to renovate and dispose of its offshore and onshore activities value R8.1 billion, which is put aside for EUR R2.four billion, and is subsequently presently not adequately funded by around R5.7 [19659002] The 4 investigations presently being carried out by the South African Police Authority (Hawks) examine allegations of monetary misconduct, fraud and mismanagement in the provide chain management:

  1. The alleged failure of the Group to comply with tender procedures if you appoint a legal agency for the Saber commerce. The award for the company was accomplished on January 12, 2012. The research continues to be in progress
  2. Failure of the power following the competition processes when the PetroSA Enterprise Advisor for Undertaking Irene was appointed. The company was appointed on November 8, 2011. The research continues to be in progress
  3. The alleged unauthorized modifications within the phrases of the monetary suggestions for the acquisition of supply-side belongings in March 2012. It is alleged that further charges have been added to the contract without the approval of the board. Analysis continues to be in progress
  4. Prohibition of absolute modifications to the financial recommendations of the PetroSA-Saber contracts. It’s claimed that in December 2011, Saber's purchase worth increased without government approval and was unfavorable to PetroSA. The research continues to be in progress

Prasa is dealing with an ongoing trial involving the acquisition of locomotives. Forensic examinations because of the public patron's 2015 report are ongoing. The Division of Main Crime Investigations investigates the instances reported by Prasa on the Anti-Corruption and Anti-Corruption Act.

Paragraph 17 of the AG AG Report 2017 states that “The Stabilization and Association Agreement did not state the the reason why the choice was not made to offer rescue providers to corporations when the company was in monetary misery for the parties concerned, as required by Part 129 (7) of the Corporations Act. .

Learn: Goodbye, SAA

The Special Investigation Unit and the Forensic Unit The SABC is at present carrying out several investigations into financial irregularities and potential fraud and allegations.

Safcol is within the course of of litigation on fires. Learn: Safcol Unlawful Expenditure on R592m in 2018

The Public Guardian carried out a research of administrative malpractice and irregular procurement processes associated to Gauteng e-payment agreements in Sanral, pursuant to Article 182 of the Constitution. The research was completed on 30.1.2018. Secondly, crime investigation is at present investigating crimes towards numerous development corporations, Sanral. The research has been ongoing since 2013.

Transnet has to research alleged irregularities and potential fraud. Lease agreements have been made with the lessors with out formal lease agreements. The group launched investigations into 1,064 alleged procurement abuses associated to the acquisition of locomotives.

Learn: Transnet rejects the CEO within the procurement procedure

The PFMA requires the financial statements to be submitted for auditing inside two months of the stability sheet date. finish of the yr. I questioned how many SOEs have already been ignored by this requirement?

How many SOEs have inadequate inner control techniques and document maintaining?

What number of SOEs can't even determine how many belongings are there?

Corporations have substantial uncertainty related to enterprise continuity?

How far more irregular expenditure has been incurred?

The hall of disgrace is on the rise.