RAF accounting fantasy collapses as ASB receipts expose CFO’s testimony and corner Letsoalo

In week eight of the Standing Committee on Public Accounts’ (Scopa) Road Accident Fund (RAF) inquiry, chairperson Songezo Zibi finally pulled the lever that had been hovering above the panel for two months: Scopa will now pursue criminal charges to compel suspended CEO Collins Letsoalo to appear and account for his decisions.

It was a moment of institutional clarity after weeks of fog, and that fog thickened dramatically the week before, when now-suspended CFO Bernice Potgieter floundered through hours of testimony while insisting, against all evidence, that the RAF had done nothing wrong under her watch.

Read more: The R500bn Road Accident Fund accounting question nobody wants to answer

The reality, however, is that there was wrongdoing. A forensic examination of Potgieter’s testimony — which the RAF media and PR unit suggested Daily Maverick do, saying that it “will not be providing comment on matters before Scopa at this time to prevent conducting a parallel inquiry through the media” — against the written correspondence from the Accounting Standards Board (ASB) reveals a CFO veering from selective truth-telling into statements that directly contradict the regulatory record.

The case of the missing R300bn

To understand why Scopa is ready to invoke the Powers and Privileges Act, you have to look at the numbers.

Under IFRS 4 or International Financial Reporting Standards (the standard the RAF was required to use), the fund’s liability in 2019/20 sat at R330-billion.

Under International Public Sector Accounting Standards, or IPSAS 42 (the new standard the RAF adopted unilaterally), that liability plummeted to R28.6-billion in 2020/21.

A R300-billion reduction is not a technical adjustment; it is an accounting miracle that turns a hopelessly insolvent entity into a solvent one overnight.

Read more: Scopa hears how RAF accounting sleight of hand buried billions in debt and claims

Potgieter’s defence to Scopa was that the RAF simply switched to “the correct” international standard to reflect reality. “I don’t think it is understated,” she told the committee, arguing that the fund “would not want to use... an insurance standard that significantly overstates our liability”.

She further claimed that “the biggest issue is that we don’t believe we are an insurer”.

Unfortunately for Potgieter, the ASB, the very body responsible for setting these standards, shared a paper trail with Daily Maverick that dates back a decade, and it tells a very different story.

Tallying up the ASB receipts

Potgieter painted a picture of an entity trying its best to navigate complex standards, claiming they “did follow the appropriate accounting standard for social benefits”. But the correspondence files Scopa has now scrutinised show the RAF was explicitly told (repeatedly) not to do exactly what it did.

• 2014: “You are an insurer.” Potgieter testified that the RAF does not believe it is an insurer. However, as far back as 2014, the ASB board confirmed that, even where activities are set out in legislation rather than contracts, “the principles in IFRS 4 were still appropriate”.

Crucially, Erna Swart, the ASB CEO at the time, confirmed that “the activities were insurance, rather than a social benefit” until international bodies completed their work.

• 2016: “Do not adopt new standards.” When the International Accounting Standards Board (IASB) began revising insurance standards, then RAF CFO Yolande van Biljon (who went on to fill the CFO role at the SABC) was sent a direct instruction. The ASB warned that new international standards were “likely to be incompatible with Standards of Generally Recognised Accounting Practice”.

The instruction was explicit. “Entities should not adopt the new IFRS on insurance once it is issued” and must “maintain the status quo”.

• 2021: “The status quo remains.” Fast forward to February 2021; the period most relevant to the RAF’s sudden accounting shift. The ASB wrote to the acting CFO, reiterating that while it was looking into social benefits, it would be a “long-term project”.

The instruction had not changed: “Entities should maintain the status quo.”

Potgieter’s claim to Scopa that the RAF adopted IPSAS 42 because it is an “international standard used by our counterparts” then completely ignores the local regulator’s explicit directive that the standard was not yet suitable for South Africa.

As ASB CEO Jeanine Poggiolini explained to Daily Maverick for additional context, IPSAS 42 is “rules based and overly prescriptive”, meaning it does not fit the economic substance of local schemes.

Mediation fantasies

Perhaps the most damaging contradiction in Potgieter’s testimony was the suggestion that the RAF engaged the ASB to resolve its dispute with the Auditor-General. She claimed they tried their best “to find each other”.

But when CEO Collins Letsoalo wrote to the ASB in August 2021 seeking guidance on its policy change, the ASB shut the door with a cold and clear: “The Secretariat of the ASB does not mediate in disputes between entities and their auditors.”

It also reminded Letsoalo that the ASB “is not permitted... to provide technical opinions”.

The CEO proceeded with the change anyway, which then resulted in an adverse audit opinion that triggered the governance crisis we see today.

Letsoalo’s last stand

With Potgieter’s testimony not lining up with the regulatory paper trail, the political gravity has shifted to suspended CEO Collins Letsoalo.

On Tuesday, 25 November 2025, Letsoalo failed to appear before Scopa as per an earlier summons. Instead, his attorneys, Sithi & Thabela, fired off a letter accusing the committee of acting ultra vires (beyond its powers).

Read more: Four RAF executives suspended amid probe into R500bn liabilities and spending abuse

Letsoalo’s legal team argues that Scopa’s mandate is limited to financial accounts and does not extend to the “substantive operational decision-making of autonomous statutory entities”. They demanded the inquiry cease and desist.

Zibi, however, was unmoved. In a swift counter, he said that the committee would not yield and warned Letsoalo that “it is a criminal offence for a person who has been duly summoned not to appear without sufficient cause”.

Tailor made

The core dispute over the RAF’s accounting standard is, as one honourable member described, a tug-of-war over institutional identity. The RAF wants to wear the robes of a social fund to hide its debt; the ASB has told it those clothes don’t fit.

But for Scopa, the issue has evolved beyond debits and credits. When a CFO gives testimony that is materially contradicted by years of written evidence, and a CEO refuses to answer a parliamentary summons, it becomes a question of the rule of law.

Potgieter may have tried to spin a complex accounting narrative to baffle the committee, but the ASB’s receipts were simple enough to read. Now, it is up to Letsoalo to decide whether he will answer the questions his CFO could not, or face the criminal consequences of silence. DM