The KHLM reported that the 2008/09 annual financial statement was submitted to the AG, and section 71 (of the MFMA) reports are submitted timeously on a monthly basis. The Karoo Hoogland Municipality reported that it does not have an internal audit and audit committee, and therefore it does not comply with section 165 of the MFMA. The KHLM added that an endeavour to establish a district unit was undertaken some years ago, but did not materialise. However, the KHLM reported that the KHLM and Hantam Municipality have recently agreed to establish and co-own a unit in the near future and these afore-mentioned municipalities have had discussions with potential service providers. The KHLM further reported that its annual reports were submitted in terms of legislative requirements for the 2007/08 and 2008/09 financial years.