Infographic: 2014/15 Municipal audit outcomes

The auditor-general (AG) reported the audit results of South Africa’s municipalities over the past 5 years during a media briefing on 1 June 2016. In its annual audits, the AG examines fair representation of financial statements, reliable and credible performance information on predetermined performance objectives and compliance with all legislation governing financial matters.

The municipal expenditure budget for 2014/15 totaled R347 billion and municipalities with clean audit opinions represent R134 billion (39%), while those with adverse and disclaimed opinions represented R20 billion (6%). The report also shows that the provinces with the highest proportion of municipalities with clean audits are the Western Cape (73%), Gauteng (33%) and KZN (30%).

Municipalities in the Eastern Cape, Free State and Mpumalanga are starting to emerge from many years of negative audit outcomes, but the AG reported that the “audit outcomes of municipalities in Limpopo, North West and the Northern Cape are disappointing at best”. Interesting statistics from the report include:

• Clean audits improved from just 13 (5%) in 2011/12 to 54 (19%) in 2014/15

• Disclaimed audit opinions decreased from 84 (30%) in 2010/11 to 29 (10%) in 2014/15

• No municipality in either Limpopo or Mpumalanga achieved clean audit opinions

• In the Eastern Cape, disclaimed audits decreased from 17 (33%) to 4 (9%) since 2010/11 and 5 clean audits have been achieved in 2014/15 compared to none 5 years ago

Although there is consensus that there is “encouraging improvement in the audit results”, irregular expenditure has more than doubled since 2010/11 to R14.75 billion. Fruitless and wasteful expenditure was more than R1 billion more and unauthorised expenditure also increased threefold to R15.32 billion since 2010/11.

See infographic below for more: