The KwaZulu-Natal provincial government is on the verge of immediately eliminating its remaining administrative hurdles that caused the province to stumble and register slightly regressed audit outcomes in 2011-12 compared to its impressive record last year.

Auditor-General (AG) Terence Nombembe says that while it is disappointing that the provincial administration’s audit results showed a regression, it is encouraging that the province is already hard at work implementing measures that will ensure long-term, sustainable accountability and a firm internal control environment.

The AG says that with the enthusiasm and commitment shown by the provincial leadership to improve its audit results, he is convinced that the province’s 26 (67%) unqualified reports (with findings) can be converted to clean audits.

Of further encouragement is that the province has continuously registered a move away from the undesirable audit categories (qualified, adverse and disclaimed); these have reduced by 17% in the past five years since the 2007-08 financial year.

Removing the few obstacles standing between the province and blanket clean administration
Among the few notable obstacles that are standing between the provincial government and wholesale clean administration is the leadership not having implemented the remaining commitments made in the prior year. These largely relate to the stability of the human resource capacity and the credibility of reported information.

Premier reports progress towards wholesale clean administration
During his 2013 state of the province address, Premier Zweli Mkhize announced that the province has reduced its vacancy rate from 23% in 2009 to the current 7% – well below the national government’s current rate of 10%. He said that there were consequences for those public servants who breached internal processes, such as those relating to supply chain management, resulting in internal investigations, the termination of services or criminal cases.

The province was also winning its fight against over-expenditure, thus resulting in the National Treasury recommending to other provinces to use KwaZulu-Natal’s successful model as a benchmark.

The AG says that it is encouraging that the provincial leadership has made significant strides in addressing those areas that have kept the province from attaining total clean administration.

“What is left now is for the provincial leadership and management to remove the remaining stumbling blocks. Once they have done that, they need to entrench and maintain the good practices for sustained positive results,” said Nombembe.

Maintaining clean administration
The departments and entities that have maintained clean audits are the Department of Arts and Culture, KwaZulu-Natal Provincial Treasury, KZN Political Parties' Fund, Natal Joint Municipal Pension Fund: Provident, Natal Joint Municipal Pension Fund: Retirement, and Natal Joint Municipal Pension Fund: Superannuation.
Within reach of clean administration if they address a few administrative and governance obstacles.

Those that have remained financially unqualified with findings include the Department of Agriculture, Environmental Affairs and Rural Development, Department of Community Safety and Liaison, Department of Cooperative Governance and Traditional Affairs, Department of Economic Development and Tourism, Department of Human Settlements, Department of Social Development, Department of Sport and Recreation, The Royal Household, KwaZulu-Natal Royal Household Trust, Agri-Business Development Agency, Dube TradePort Company, KwaZulu-Natal Gaming and Betting Board, KwaZulu-Natal Growth Fund Managers (Pty) Ltd, Ithala Development Finance Corporation Ltd, Ithala Limited, Kwanaloga, KwaZulu-Natal Sharks Board, KwaZulu-Natal Tourism Authority, Mjindi Farming (Pty) Ltd, KwaZulu-Natal Provincial Pharmaceutical Supply Depot, and uMsekeli Municipal Support Services.

Those that stumbled in the 2011-12 audits
The KZN Office of the Premier, KZN Provincial Legislature, Department of Transport, and Trade and Investment KZN, which received clean audits in 2010-11, are among those that have regressed to financially unqualified opinions with findings.

The AG reiterated his office’s commitment to assisting auditees, highlighting that following the launch of government’s Operation clean audit in July 2009, he had introduced regular engagements with municipal, provincial and national political leaders to share his office’s assessment of key controls in the areas mentioned above and to identify threats to clean audits. These engagements helped to create greater awareness on matters that require urgent attention to enable the realisation of clean administration in all spheres of government.