The Western Cape has retained its best performing status as the province with the most clean audits.
It received 18 clean audits, with only two unqualified with opinion audit outcomes.
This was revealed by auditor-general Tsakane Maluleke, when she presented the national and provincial audit outcomes for the 2024/25 financial year on Thursday.
“There has been very little improvement in the audit outcomes of particular provinces,” she said.
The Free State and North West ranked the lowest in clean audits, with the auditor-general stating that these provinces should cause concern. Both are reported to have only had three clean audits.
“Their outcomes are not really improving in any way that is encouraging. They remain stuck.”
Gauteng received 13 clean audits, with eight unqualified with opinion outcomes, one qualified with findings and one disclaimer.
“Similarly, Gauteng is not moving much. In fact what we saw was a regression in the department of education in the province, and health caused some worry as well,” Maluleke said.
She noted KwaZulu-Natal’s stagnation, having been awarded seven clean audits with seven unqualified with findings audit outcomes. Two opinions were qualified with findings and three audits were marked outstanding.
“In KZN what we see is that there has been a regression at the department of health and that should account for that big budget number that has gone backwards. The health department has moved to a qualified audit opinion, which should be a source of concern. The department is characterised by major non-compliances, a number of procurement irregularities and even financial losses that are being incurred because of a lack of financial discipline on the procurement side.”
The AG stated that Limpopo was progressing, receiving six clean audits, 10 unqualified with findings outcomes and three qualified with findings.
“We saw an encouraging improvement in Limpopo, in the department of education and that accounts for movement in the right direction even when you look at the budget numbers.”
Mpumalanga received four clean audits, seven unqualified with findings outcomes and six qualified with findings outcomes.
“In Mpumalanga, the province still has a long way to go before the work that the premier is doing starts to translate into an improvement in the lot of the financial management there. The clean audit that improved was the audit at the office of the premier.”
The AG said there was not much movement in the Northern Cape and still significant work to be done, adding that its health department had also regressed.
The province received six clean audits, three unqualified with findings, two qualified with findings and one auditee reported as an outstanding audit.
Meanwhile, Maluleke praised the Eastern Cape for displaying “encouraging improvements”.
“If you look at the budget numbers in terms of the level of improvement, the story there is that the EC department of health and that of education actually improved their audit outcomes. They are not yet clean audit outcomes, but they have improved from qualified to unqualified.
“That came on the back of support from Provincial Treasury in the main. They were able to work with those departments and help them to compile decent financial statements. We are not home yet, but it is meaningful progress. About a decade ago those auditees were stuck in a disclaimer zone.”
Maluleke said it should be the foundation of all good governance for departments and entities to achieve clean audit status.
“If an auditee is able to get a green tick in that their financial statements are credible, their performance report is useful and reliable, and we’ve not found any significant non-compliances with key laws and regulations that relate to financial performance and management, then they get what is called a clean audit outcome. That means that it is an unqualified opinion, meaning that their financial statements are credible and that they don’t have any findings on performance or compliance.”
She said a clean audit should be the destination of every single auditee within the public service.
The AG explained that an unqualified with findings audit opinion means that the auditee was able to produce good quality financial statements that had no material misstatements, but struggled to produce good quality performance reports to comply with legislation.
A qualified opinion with findings means that the financial statements produced contained material misstatements that were not corrected, she said, adding that there might have been challenges with the quality of its performance report.
An adverse opinion means that the auditee’s financial statements had many material misstatements and that the auditor-general disagreed with virtually all the amounts and disclosures included.
A disclaimed opinion means the AG could not conclude or express an opinion on the credibility of the auditee’s financial statements because there was no evidence to support most of the amounts and disclosures included.
Maluleke said this financial year under review is the first one under the seventh administration.
“We looked at their opening balance, where they started at the end of the 2024 financial year and what they took over from the sixth administration. At that point, there were 142 clean audits; we now sit at 151 clean audits. It has been interesting and encouraging to see some movement in the right direction. These clean audits make up 36% of the audit base of 471 auditees.”
TimesLIVE
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.