For many years, the Auditor-General’s office came under intense criticism for highlighting how taxpayer funds were being mismanaged but not taking action against accounting officers at government departments and state-owned enterprises (SOEs).

These accounting officers are responsible for annual expenditure worth at least R2-trillion, and year after year the Auditor-General would publicly trash them for not following proper rules when spending money (known as irregular expenditure that gives rise to fraud and corruption), or not accounting for every single rand spent.

Although the Auditor-General recommended remedial action, the accounting officers often ignored it. Their errant behaviour, in some instances, got worse. They would not bother to submit financial statements to be audited, leaving taxpayers in the dark about the true state of their departments’ financial affairs.

But 2022 has been a turning point for the Auditor-General’s office, led by Tsakani Maluleke. It has increasingly flexed its accountability muscle and got accounting officers to toe the line of good governance.

It all goes back to four years ago when the law was changed to increase the Auditor-General’s powers. Amendments to the Public Audit Act came into effect on 1 April 2019 and gave the Auditor-General power to act against recalcitrant accounting officers.

The office can now identify and report “material irregularities” in the financial books of government departments and SOEs. This happens when accounting officers consistently fail to implement the office’s previously issued recommendations that are aimed at preventing further financial losses, acts of fraud, and corruption.

As a final resort, the Auditor-General can now issue accounting officers with “certificates of debt”, which may hold them personally responsible for irregular expenditure. Where its recommendations have been ignored, it can refer cases to the Financial Information Centre, the Special Investigating Unit (SIU) and the Hawks for further investigation and the recovery of wasted taxpayer funds.

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The Auditor-General’s office has used its enhanced powers to identify 179 “material irregularities” that carried financial losses worth R12-billion during its 2021/22 financial year. It prevented R636-million in further losses from being incurred; losses worth R509-million were in the process of being recovered; and R14-million in losses was successfully recovered.

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There are encouraging developments in other areas: 36 accounting officers were disciplined, 15 fraud and criminal investigations were launched and five improperly awarded contracts were stopped.

Maluleke says it’s just a start considering that the Auditor-General’s wider powers are relatively new. The office also relies on the efficiency of the Hawks to investigate and prosecute cases, and the SIU (working with courts) to start the process of recovering wasted funds.

Maluleke says she has seen a shift because government departments and SOEs now respond fast to findings and recommendations.

This is also helping to improve audit outcomes, and 114 more government departments and SOEs have received clean audits than in 2018. In the same breath, 46 more regressed.

Her office is the winner in the South African Institute of the Year category. DM168

How we chose the People of the Year winners

In the past, Daily Maverick journalists decided who they thought warranted the title of Person of the Year, but for the second year running, we have asked readers to vote for their preferred choice, with the proviso that we still have the final say. Choosing the annual winners is a labour of love because that’s what it takes to get a bunch of DM editors to decide whether they agree or disagree with the choices of 13,000 readers. Over the next few days, we shall republish online all the results in various categories. – Heather Robertson, DM168 editor

How readers voted in the Institute of the Year category.

This story first appeared in our weekly Daily Maverick 168 newspaper, which is available countrywide for R25.