Auditor-General (AG) Tsakani Maluleke on Friday issued the first certificate of debt (CoD) when North West Ngaka Modiri Molema district municipality accounting officer Allan Losaba was held to be personally liable for financial loss of more that R4-million.

This is the first time the AG has issued a CoD since the Public Audit Act (PAA) gave her the powers when it was amended in April 2019.

This CoD follows Losaba’s failure to recover financial losses from overpayments for water tankering services.

“The CoD amounts to R R4 616 074.66, together with interest applicable to the period between 30 days after this certificate has been served and the date of full payment of the debt due,” Maluleke said.

The municipality extended a service provider’s contract multiple times for drought relief and water and sanitation services, during which overclaiming on kilometres and working hours were identified, leading to significant financial losses.

Maluleke said her office identified a material irregularity (MI) during audits, which included non-compliance and potential financial loss.

Maluleke pointed out that Losaba was notified and given opportunities to address the MI but failed to implement necessary actions or recover losses, which led to Maluleke issuing the CoD.

She noted that that Losaba initially responded to the MI notification and made several commitments to address the MI, and the assessment of the audit team was that appropriate action was being taken in the first year.

“However, the commitments were not implemented, and recommendations for the recovery of the financial losses were included in the 2020-21 audit report. The accounting officer still failed to implement the recommendations, which led to the issuing of the remedial action in terms of section 5A(2) of the PAA, 2004, for the accounting officer to recover the financial losses. Notwithstanding the issuing of the remedial action, the accounting officer still failed to recover the financial losses,” Maluleke explained.

The mayor is responsible for recovering the amount specified in the CoD and must report progress regularly to the AG.

Maluleke emphasised the importance of accountability and the need for swift action from accounting officers to prevent the use of remedial powers.

She highlighted that her office remained committed to enforcing these powers to ensure good governance and financial management in the public sector.