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Provincial Audit Outcomes

Statement by the Director General of the Northern Cape, Mr. Justice Bekebeke on the Provincial Audit Outcomes of the 2011/2012 Financial Year - 24 OCTOBER 2012
The Provincial Auditor General has completed the annual audit of all provincial departments and has expressed an opinion on each provincial department. An audit opinion differs from disclaimer of audit opinion to qualified and unqualified audit opinions.


Though the audit outcomes of the Province for the 2011/12 financial year shows a regression in comparison to the 2010/11 financial year it should be stated that there has been a major improvement in many of the other departments in terms of matters that have been raised by the Auditor General.

Fair presentation, accountability and transparency is prioritized hence disclosure of irregular expenditure as reported in the financial statements. The irregular should not be misconstrued as being monies wasted as every case should be judged against merit.

There is a clear distinction made in the by the Public Finance Management Act between unauthorised expenditure, fruitless and wasteful expenditure and irregular expenditure.

Unauthorised expenditure means overspending of a vote or a main division within a vote or expenditure not in accordance with the purpose of a vote or in the case of a main division, not in accordance with the purpose of the main division

Fruitless and wasteful expenditure means expenditure which was made in vain and would have been avoided had reasonable care been exercised whilst

Irregular expenditure means expenditure, other than unauthorised expenditure, incurred in contravention of or that is not in accordance with a requirement of any applicable legislation including the Public Finance Management Act, the State Tender Board Act, 1968 (Act No. 86 of 1968), or any regulations made in terms of that Act; or any provincial legislation providing for procurement procedures in a provincial government.

A recent article in the DFA highlighted the fact that the irregular expenditure for the 2011/12 financial almost doubled to an amount of R2.4 billion. This amount needs to be contextualised. During auditing, the auditors took a decision to go as far back as five years with the auditing process. As much as we do not dispute the right that the auditors have to do this; I need to emphasise that the irregular expenditure is thus not contributed to one year but as a result of the cumulative years the irregular expenditure was more.

Much of the transgressions that occurred in Departments are thus mainly as a result of the Supply Chain Procedure Reforms and in most instances not deliberate.

Given the above as Provincial Government we hold the view:

In instances where transgression are encountered Accounting Officers will be held responsible
Critical Finance positions in all Departments will be filled within the available resources
Action Plans will be relooked and more emphasis placed on assessment dates
The Internal Audit unit in the Treasury Department is now suitably capacitated and will be in a position to do pre-audits and to identify control deficiencies
The work of this unit will be further supported by the Audit Committees
A joint Financial Management team consisting of senior officials from Provincial Treasury, the Department of Health and the Office of the Premier has been established to assist the Department of health with the implementation of its Financial Recovery Plan.

As the Northern Cape Provincial Government we will ensure that our governance structures will be strengthened and will be operationalised. The province is committed to accountability and a clean administration and we take note that to move from the position we are at, is a process and is not something that can be done over night.

Released by the Office of the Premier


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