Assessment of clean audit outcomes as an effective determinant of good service delivery: a case study of Midvaal Local Municipality

Abstract

The Office of the Auditor-General in South Africa conducts audits of local government institutions, among other public-sector entities, to assess the current financial condition of municipalities and provide audit opinions for a certain fiscal year. Municipalities are obligated to maintain clean audits to avoid financial fines. However, the significance of clean audit outcomes lies in their ability to ensure successful service provision to the citizens. The Auditor-General's municipal audit findings reveal that several municipalities obtain clean audits, notwithstanding their inadequate performance in terms of service delivery. South Africa has a few municipalities that have successfully achieved desirable audit outcomes, with Midvaal Local Municipality being a notable example of consecutive clean audits. This study aims to evaluate whether the clean audit outcomes of Midvaal Local Municipality may serve as reliable indicators of effective service delivery within the municipality. The article utilizes a literature review and an online qualitative questionnaire survey with open-ended questions as approaches for collecting data. The article's findings highlight that the municipality has implemented effective management processes, also known as internal controls, which enable Midvaal to deliver services to its citizens in an effective and efficient manner. This management techniques may effectively determine the quality of service delivery within the municipality. They have a favorable impact on the municipality's financial viability, which directly results in clean audit conclusions.

Keywords: {'name': 'Audit outcomes, auditor-general, service delivery, local government, good governance.'}

Authors & affiliations

Mzwakhe Samuel Khasodi
Affiliation not supplied

Sandiso Mahlala
Affiliation not supplied

Costa Hofisi
Affiliation not supplied

Deposited references

Supplied references, not a list of publications citing this article.

DOI: 10.22495/cocv13i2c3p5

ÁFRICA, D. (2020). Constitution of the Republic of South Africa, 1996.

Annual General Report of Controller and Auditor-General. (2021). Available at: [URL]. (Accessed on 8 May 2022).

Auditor General of South Africa (AGSA). (2019a). Consolidated general report on the audit outcomes of local government 2017-2018, Office of the Auditor-General South Africa, Pretoria.

Auditor General South Africa (AGSA). (2019). General report on the local government audit outcomes 2018/19. Pretoria: Government Printer.

Auditor General South Africa (AGSA). (2020). Consolidated General Report on the Audit Outcomes of Local Government 2018/19. [URL]. Date of access. 10 Aug. 2021.

Auditor-General. (2018). Media release. Available at: [URL]. (Accessed on 7 May 2022).

Banicova, K. (2016). Internal Control System in Municipality Self-Government of the Slovak Republic. In 3rd International Multidisciplinary Scientific Conference on Social Sciences and Arts SGEM 2016 (pp. 361-368).

Barac, K., & Van Staden, M. (2014). Internal auditing as a corporate governance mechanism: A comparison between public sector and private sector functions.

DOI: 10.1007/978-0-230-36431-8

Chitiga-Mabugu, M., & Monkam, N. (2013). Assessing fiscal capacity at the local government level in South Africa. Journal of local governance, 1-23.

Craythorne, D. L. (2006). Municipal administration: The handbook. Juta and Company Ltd.

Daily Business Insider. (2020). These are the best-run municipalities in SA – including Midvaal and Okhahlamba in KZN. Daily Business Insider, 05 Jul. [URL]. Date of access. 08 May 2022.

DOI: 10.1108/JPBAFM-07-2020-0120

De Visser, J. (2005). Developmental local government: A case study of South Africa. Intersentia nv.

Dorasamy, N., Garbharran, H. L., & Nyamita, M. O. (2015). A review of public sector financial management reforms: an international perspective. Public and Municipal Finance, 4(2), 25-37.

DOI: 10.25159/1998-8125/6332

Glasser, M., Cochran, T. H., DeAngelis, M., Hesketh, M., Johnson, R. W., Kapp, C. J., & Petersen, J. E. (1998). Formulation of a Regulatory Framework for Municipal Borrowing in South Africa. World Bank.

Goodson, S. G., Mory, K. J., & Lapointe, J. R. (2012). Supplemental Guide: The Role of Internal Auditors in Public Sector Governance (2nd ed.). Altamonte Springs, FL.: The IIA.

Graig, S. E. (2017). Keeping decentralisation in check: An exploration of the relationship between municipal audit outcomes and service delivery in South African local government. Rondebosch: University of Cape Town. (Thesis – Master?s).

DOI: 10.1111/1467-6281.00048

DOI: 10.4324/9781315685786

Institute for Security Studies. (2015). The reasons Behind Service Delivery Protests in South Africa. Polity, 1–2.

Institute of Directors South Africa. (2010). King Report on Governance for South Africa 2009: King Code of Governance Principles for South Africa 2009; Companies Act 71 of 2008. Juta and Company Ltd.

ISSAI, F. (2012). IDI ISSAI Implementation Program. International Journal of Government Auditing.

DOI: 10.1111/faam.12243

DOI: 10.14453/aabfj.v9i3.5

Khan, M. Y. (1994). Financial Services. Tata McGrawhill Publishing Company Ltd., 3rd Edition.

Khumalo, M. T. (2007). An Investigation of the Efficacy of the Office of the Auditor-General in Ensuring Public Financial Accountability in the Gauteng Province (Doctoral dissertation, University of Fort Hare).

Koekemoer, S. (2017). Information technology and municipal audit outcomes-does information technology support achieving a clean audit report? CIGFARO Journal (Chartered Institute of Government Finance Audit and Risk Officers), 17(4), 26-30.

Kroukamp, H. (2017). Sustainable governance: the solution to the South African local government service delivery problems? Journal for New Generation Sciences, 15(2), 33-47.

Laubscher, L. H. (2012). Challenges on financial control and accountability in South African municipalities. Journal for New Generation Sciences, 10(1), 63-79.

Madue, S. M. (2007). Public Finance Management Act, 1 of 1999 –A compliance strategy. Politeia, 26(3), 306-318.

Madumo, O. S. (2015). Developmental local government challenges and progress in South Africa. Administratio Publica, 23(2), 153-166.

Makwembere, S., & Munzhedzi, P. H. (2019). Good governance as a solution to local economic development challenges in South African municipalities. Journal of Public Administration, 54(4-1), 659-676.

Manzini, S. (2016). "The views of government officials on the Integrated Development Plan as a framework for local government that is developmental and responsive to peoples’ needs [Gauteng]."

DOI: 10.1002/pa.1982

Mashalaba, B. (2016). An Assessment of the Relationship Between Clean Audits and Service Delivery: A Study of Amathole District Municipality in the Eastern Cape Province, for the 2013/2014 Financial Year (Doctoral dissertation, University of Fort Hare).

Mashamaite, K. (2014). Public service delivery protests in a democratic South Africa: A dilemma for local municipalities. Mediterranean Journal of Social Sciences, 5(25), 231.

Mathebula, N. E. (2016). Audit outcomes and their role in clean administration in municipalities within Limpopo Province, South Africa: a deterrence theory approach

DOI: 10.4102/aej.v8i1.464

Mbandlwa, Z. (2022). The investigation of the disparities between unqualified audit opinion and effective public service delivery. International Journal of Special Education, 37(3).

Mnguni, S., & Subban, M. (2022). Critical Considerations to Achieve and Maintain Clean Audit Outcomes in South African Metropolitan Municipalities. Administratio Publica, 30(3), 148-170.

Moore, H. M. (1995). Creating Public Value: Strategic Management in Government. London: Harvard University Press.

DOI: 10.4159/harvard.9780674067820

Morehead, W. A. (2007). Internal control and governance in non-governmental organization designed to provide accountability and deter, prevent and detect fraud and corruption. Thesis submitted in fulfilment of the requirements of a Doctoral degree, University of Southern Mississippi, Southern Mississippi.

Motubatse, K. N., Ngwakwe, C. C., & Sebola, M. P. (2017). The effect of governance on clean audits in South African municipalities. African Journal of Public Affairs, 9(5), 90-102.

Mpehle, Z. (2012). Are service delivery protests justifiable in democratic South Africa? Journal of public administration, 47(si-1), 213-227.

DOI: 10.4102/apsdpr.v9i1.490

National Treasury. (2021). State of local government finances and financial management 2021 As of June 2021, Audit Outcomes of the 2020/21 financial year Analysis Document, Government Printing Works, Pretoria.

Ncgobo, P., & Malefane, S. R. (2017). Internal controls, governance and audit outcomes-case of a South African municipality. African Journal of Public Affairs, 9(5), 74-89.

DOI: 10.14746/rrpr.2022.60s.05

DOI: 10.35293/srsa.v43i2.872

Njanike, K., Mutengezanwa, M., & Gombarume, F. B. (2011). Internal controls in ensuring good corporate governance in financial institutions. Annals of the University of Petro?ani. Economics, 11, 187-196.

Oberholzer, C., & Diedricks, J. (2012). Municipal Leadership Collectively Responsible for Achieving Clean Audit. http://www.infrastructurene.ws/2012/12/03/municipal-leadership-collectively-responsible-for-achievingclean-audit (Accessed: Jun 06, 2022).

DOI: 10.1177/146499341101200304

DOI: 10.1111/pbaf.12120

Peters, S., & Van Nieuwenhuyzen, H. (2012). Understanding the dynamics of the capacity challenge at local government level. Technical Report: 2013/14 Submission for the Division of Revenue.

DOI: 10.1016/j.jaccpubpol.2018.04.001

Powell, D. M., O’Donovan, M., Ayele, Z., & Chigwata, T. (2014). Operation Clean Audit 2014. Why It Failed and What Can Be Learned, Cape Town: Multi-Level Governance Initiative.

DOI: 10.1057/jdg.2010.24

Ross, D. (2016). A Case Study of Municipal Government Financial Management and Effective Internal Controls. Northcentral University.

Sambo, V. T. (2019). An analysis of audit outcomes and service delivery at the local government sphere in South Africa. International Conference on Public Administration and Development Alternatives (IPADA).

Sibanda, M. M. (2017). Control, ethics, and accountability in the financial management performance of Eastern Cape municipalities. Journal of Public Administration, 52(2), 313–339. https://0-hdl.handle.net.wam.seals.ac.za/10520/EJC-bf4bd217f

DOI: 10.1080/23311975.2020.1785105

DOI: 10.4172/2315-7844.1000189

Van der Waldt, G. (2006). Managing local government performance: key considerations and challenges. Journal of Public Administration, 41(2), 128–143.

Van Der Walt, M. (2012). State of Municipalities' Audit Reports-2010/2011 and the road to Operation Clean Audit 2014. IMFO: Official Journal of the Institute of Municipal Finance Officers, 12(4), 30-33.