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Makwetu: A Quarter Of SOEs Won't Exist In The Future

Irregular expenditure in state-owned enterprises has ballooned.

17/11/2017 07:57 SAST | Updated 17/11/2017 08:00 SAST
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Auditor-general Kimi Makwetu says over a quarter of state-owned enterprises (SOEs) may not continue operating in the future owing to their dire financial situation, Fin24 reported. Speaking at an event hosted by the University of Cape Town Graduate School of Business, Makwetu reportedly decried the state of financial accountability across the state.

He said the SOEs that might not exist in the future include the SABC, the South African Post Office and PetroSA.

Irregular expenditure at SOEs increased to R2.8-billion in the last financial year, Fin24 reported. Makwetu reportedly said this was due to weakened supply chain management procedures.

He said it was not difficult to achieve an unqualified audit. Makwetu said he had signed off 422 sets of financial statements in the last financial year and only 30% of these received qualified audits with no findings.

"An auditor will come to you and say, "that R250,000 is incorrectly accounted for, so please adjust. And you can correct it," he reportedly said.

Makwetu said supply chain management was the area where most of the transgressions occurred. There were often conflicts of interest at stake, he said.

Irregular expenditure across the whole of government increased to R45-billion, Makwetu announced earlier this month.