Persistent Audit Challenges in Municipalities Reports the Auditor General
Auditor-General Tsakani Maluleke has released the 2022-23 consolidated general report on local government audit outcomes. The report highlights ongoing challenges in achieving meaningful improvements in municipal audits. Despite concerted efforts from various stakeholders, the audit results reveal that most municipalities still struggle to meet required standards.
Audit Results Overview
The report indicates that only 34 out of 257 municipalities managed to obtain clean audits, reflecting a mere 13% success rate. This figure demonstrates a slight increase from previous years but underscores the need for significant improvements. While 45 municipalities have shown progress since the last term, 36 have regressed, highlighting inconsistent compliance and performance management practices.
Common Audit Findings
The prevalent audit outcome for the majority of municipalities relates to performance reporting or compliance with key legislation. These findings suggest that many municipalities continue to face difficulties in aligning their operations with statutory requirements and effective performance management.
Compliance and Financial Management Issues
A staggering 86% of municipalities encountered material compliance findings, indicating a minor regression in adherence to legislation compared to previous years. Financial mismanagement remains a critical issue, with many municipalities failing to collect revenue effectively or manage expenditures prudently. This has led to unfunded budgets, high unauthorised expenditures, and significant financial losses, impacting the municipalities' ability to deliver essential services effectively.
Improvements
The report commends the municipalities with clean audits, noting that these typically exhibit strong financial and performance management disciplines.
Recommendations
The Auditor-General calls for an intensified effort from all municipal stakeholders to foster a culture of accountability, performance, and transparency, crucial for enhancing service delivery and living conditions for citizens.
The 2022-23 audit outcomes highlight the urgent need for systemic changes within local governments. Strengthening governance, enhancing financial management, and ensuring strict compliance with legislative frameworks are essential steps towards stabilising municipal operations and restoring public trust in local governance. The report serves as a call to action for municipalities to prioritise professional development, improve intergovernmental support, and commit to ethical governance to overcome these persistent challenges.
Read the Media Release for more detail.
