South African National Parks (SANParks) has not taken effective steps to prevent irregular expenditure amounting to R523 million in the 2023-24 financial year.
The majority of the irregular expenditure was due to the utilisation of expired contracts.
This is according to Auditor-General Tsakani Maluleke, who was unable to obtain sufficient appropriate audit evidence that disciplinary steps were taken against officials who had incurred irregular expenditure, as required by section 51(1)(e)(iii) of the Public Finance Management Act (PFMA).
“This was because investigations into irregular expenditure were not performed,” Maluleke said.
Some of the competitive bids were adjudicated by a bid adjudication committee that was not composed in accordance with the policies of the public entity. She put the blame on the failure by the management to implement the recommendations from the loss control committee.
“Management did not ensure that adequate oversight controls are in place to prevent, identify and record irregular expenditure.”
SANParks CEO Hapiloe Sello said the entity continued to experience challenges within the supply chain management space, particularly on contract management which in many instances had resulted in irregular expenditure.
“We are implementing a new electronic system and will employ additional personnel to assist us with enhancing our contract management processes,” Sello said.
She said SANParks’ internal assessments indicated that the organisation did not always comply with applicable supply chain management processes in the procurement of goods and services.
“This resulted in irregular expenditure of R523m, the bulk of which is R284m from fuel expenditure where procurement was done without following normal supply chain management processes.”
However, Sello said SANParks implemented consequence management in the form of training for staff or disciplinary action against employees responsible for incurring irregular expenditure.
“In the year under review, SANParks had 118 irregular expenditure cases referred for consequence management, 87 (74%) cases were resolved and disciplinary action taken while 31 (26%) cases are still pending.
“The outstanding cases are to be finalised in the first quarter of the new financial year.”
The auditor-general found during the auditing of the SANParks finances, figures for March 31, 2023, were restated as a result of an error in the financial statements of the public entity at and for the year ended March 31, 2024.
“The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting framework as required by section 55(1) (b) of the PFMA.
“Material misstatements of cash flow statement, segment information and risk management identified by the auditors in the submitted financial statement were corrected, resulting in the financial statements receiving an unqualified audit opinion,” she said.
SANParks management did not conduct adequate reviews on the financial statements before submission for auditing to ensure that the financial statements were in line with applicable financial report standards.
Maluleke noted that the entity was the defendant in a number of lawsuits.
“The ultimate outcome of the matters could not be determined and no provision for any liability that may result was made in the financial statements.”
The A-G noted with concern that effective and appropriate steps were not taken to collect all revenue due as required by the PFMA.
“Management did not implement effective steps to ensure that conservation revenue is charged at approved tariffs.”
Cape Times