While it is nearly time for the auditor general to release his report on the local town council’s financial affairs of the year ended June 2011, the previous report is still causing waves, as did the one before that.

The Soutpansberg Ratepayers Association has asked the Public Protector (PP) for a full investigation into all financial matters of the Makhado Municipality with reference to the 2009/10 report of the auditor general (AG). A letter in this regard was send to the PP on 15 November. In the letter, the association asks the PP to investigate “all financial matters, procedures and failure to secure cash, equipment and others resolving in unauthorised expenditure. We request your office to deal with the Municipal Manager and Chief Financial Officer in accordance with the law.”

On 14 November, a letter was also delivered to the municipal manager, Mr Shadrack Tshikalange, concerning the outcome of the same AG report. The SRPA says that the report implies that both the accounting officer, who is the municipal manager, and the chief financial officer have committed acts of financial misconduct. Non-compliance with regulatory and reporting requirements was quoted.  This contravenes Section 17 1 1(a) to (c) of the MFMA and both officers should be charged with financial misconduct, says the SRPA.

Unauthorised, irregular or fruitless and wasteful expenditure were indicated in the 2009/10 AG report. The SRPA says that there are prescribed ways that Council should deal with this according to the municipal budget and financial reporting regulations. A Council committee should investigate the recoverability of any unauthorised, irregular or fruitless and wasteful expenditure and the municipal manager must provide all information required for a proper investigation.

The SRPA’s major question is whether action will be instituted against the municipal manager and the chief financial officer in office during the 2009/10 financial year. They want to know when the action will be instituted and if no action were to be instituted, what  the reason would be. Tshikalange has until 15 December to respond.

On Tuesday, municipal spokesperson Mr Louis Bobodi said that Tshikalange was still looking into the matter. “The municipal manager said he would be meeting with the ratepayers later in the week and, should they raise the matter, he would respond,” Bobodi said.

A year ago, criminal charges against Tshikalange were seriously considered by the SRPA. That was on the grounds of the 2008/9 AG report. Tshikalange had until 18 December 2010 to indicate why criminal charges should not be filed against him as accounting officer. He only responded to this on 17 May this year.

Tshikalange explained that an audit plan had been put into place to address issues raised by the AG report.  An internal audit unit was also established in his office. “The outstanding items in the 2008/9 audit action plan were included in the 2009/10 audit action plan; that is, the outstanding recurring items are rolled over to the audit action plan of the following year until the query is fully addressed … the municipality is an active participant in the Operation Clean Audit 2014 programme initiated by the Department of Corporate Governance,” stated Tshikalange.

The SRPA, through their attorney, then requested a copy of the audit action plan, the programme of activities of the internal audit unit and Tshikalange’s participation in respect of the Operation Clean Audit 2014 programme. Surprisingly, the municipality's response was to present the Promotion of Access to Information Act, Act 2 of 2000, as its defense. This means that the SRPA must apply for the information to be disclosed.

In the meantime, the SRPA has started with new action in respect of the 2009/10 AG report.

“Every time a poor AG Report is brought out, indicating financial mismanagement, we will institute action,” said SRPA chairperson Ms Inga Gilfillan on Tuesday.