Auditor-general Tsakani Maluleke has found that the Department of Agriculture, Land Reform and Rural Development (DALRRD) failed to take to task officials responsible for fruitless and wasteful expenditure totalling more than R30 million in the 2022/23 financial year.
Maluleke said effective steps were not taken to prevent the fruitless and wasteful expenditure.
“The majority of the fruitless and wasteful expenditure was caused by payment of invoices for services not rendered,” she said.
“Disciplinary steps were not taken against officials who had incurred and/ or permitted irregular expenditure as required,” Maluleke reported in her findings.
According to the auditor-general, the department’s management did not implement adequate oversight controls to ensure the action plans to address prior years findings were monitored and addressed to facilitate reliable reporting.
“Management did not implement effective monitoring of compliance with applicable legislation.
“Non-compliance with legislation processes could have been prevented if compliance had been properly reviewed and monitored.”
Maluleke also said the financial statements submitted for auditing were not fully prepared in accordance with the prescribed financial reporting framework and/or supported by full and proper records as required by the Public Finance Management Act.
“Material misstatements of the advances expensed, prepayments expensed, payables and contingent liabilities identified by the auditors in the submitted financial statements were corrected and the supporting records were provided subsequently, resulting in the financial statements receiving an unqualified opinion,” she said.
Head of department Mooketsa Ramasodi said both the department’s financial and non-financial performance have improved during the financial year under review.
“The audit opinion for the Department of Agriculture, Land Reform and Rural Development is unqualified. However, these areas of improvement call for greater effort in addressing matters of audit emphasis,” Ramasodi said.
However, he noted that the department registered an increase in irregular expenditure from R5.519 million in 2021/2022 to R15.369m in 2022-23.
Irregular expenditure of R15.031m resulted from the department’s failure to get approval from National Treasury for deviation as required in terms of supply chain processes and an amount of R308 000 because the department advertised a bid for 19 days instead of 21 days.
Ramasodi added that there was also R25 000 spent as a result of the department obtaining less than three quotations.
He noted that the department recorded fruitless and wasteful expenditure to the tune of R30.055 million.
Ramasodi said the department has established and capacitated the directorate of internal control to ensure that sound internal controls are in place to curb the cases of unauthorised, irregular, fruitless and wasteful expenditure.
“There is also a financial compliance committee that assesses the cases of irregular, fruitless and wasteful expenditure and it recommends the appropriate actions to be implemented.”
The department’s internal audit committee said the system of internal control was not entirely adequate and effective for the year under review.
“Deficiencies were detected and reported through internal audits performed on the system of internal control. Management continued to address control weaknesses reported by the internal audit function.”
Cape Times