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The City of Johannesburg is upbeat after receiving an unqualified audit report from the Auditor General for the 2012/2013 financial year.
Auditor General Kimi Makwetu revealed the findings in Pretoria on 30 July. An unqualified audit report means that the AG does not have any reservations concerning the financial statements that were submitted to him.
Member of the Mayoral Committee for Finance Geoffrey Makhubo, attributed the findings to the city’s compliance with the Municipal Finance Management Act, citing the absence of irregularities and wasteful expenditure in the report as proof that the City’s governance and financial position are in good shape.
He said the report also indicates that billing and uncollected revenue issues are now under control.
“This is the clearest indication yet that our Revenue Step Change Programme and our efforts to clean up the quality of data on the billing system are achieving positive results. The City collected 92% of revenue billed and intends to improve this to 97% in the coming financial year.”
According to the report, most of the institutions audited had inadequate measures in place to detect and quantify wasteful spending.
Of the 319 audits, 22 municipalities and eight municipal entities (9%) had unqualified audits with no findings, otherwise known as clean audits.
Two of the city’s entities, Johannesburg Fresh Produce Market and the Johannesburg Social Housing Company received clean audits.
Councillor Makhubo added that the city made a surplus of R3.4 billion and the net assets improved by 13% to R30.4 billion, indicating that the City is in excellent financial position.
“Improved liquidity management enabled the City to increase its cash and cash equivalents by 143% to R5.4 billion. The debt to revenue ratio stands at 38.77%. This is significantly down from 41.24% in the previous year.”
The city’s chief financial officer Reggie Boqo said the city received a total revenue of R35 billion in the last financial year, further adding that the findings gave hope for a clean audit in the next financial year.
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City hails an unqualified report