The purpose of this study was to investigate the relationship between the concept of clean audit reports in relation to service delivery. The study was conducted in the Amathole District Municipality in the Eastern Cape Province and centred on the audit outcome of the municipality for the 2013/2014 financial year. A qualitative research design was adopted in order to conduct the study and the data was collected through the conducting of semi-structured interviews. The research sample comprised officers who were employed by the Amathole District Municipality and one manager from the office of the Auditor-General. The key findings of the study revealed that, at present, the concept of a clean audit outcome is used by municipal officers to imply that the performance of an organisation is to be assessed mainly on the basis of evidence which is provided by financial indicators, to the exclusion of non-financial benchmarks. This assumption tends to encourage municipal officers to strive towards impressing auditors, rather than serving their communities through the providing of adequate service delivery. In addition, the auditing of municipalities does not assess their performance in relation to service delivery and the ways in which communities at the local level are affected by it. At present it appears to be beyond the remit of auditors to investigate the validity of the protests which erupt in communities in response to poor service delivery or whether the members of communities and other affected stakeholders are satisfied or dissatisfied with the manner in which services are rendered by their municipalities. Consequently, those who are tasked with the making of decisions in municipalities act upon the recommendations which are made in their audit outcomes and formulate plans in relation to service delivery or projects which do not necessarily accord with the needs of the communities which they are intended to serve. Consequently, on the basis of the findings of this study, it is proposed that assessments of the performance of organisations should incorporate non-financial indicators into the auditing process. Adopting this approach would minimise incidences of municipalities receiving clean audit outcomes while the members of the communities which they serve take to the streets to express their anger and frustration as a result of poor service delivery.

The 1996 Constitution of South Africa and the Public Audit Act of 2004 provide the legislative framework for the Office of the Auditor General of South Africa (OAGSA). The Independent Regulatory Board for Auditors further enriched the interpretation of the framework – for government auditing. Over the years of democratic rule in South Africa, audit performance by State organs was generally poor. Despite the efforts by the OAGSA to improve the performance, very little improvement was notable. Most disturbing was the observation that there was widespread, a prevalence of recurring findings, which indicated that the OAGSA’s recommendations and guidelines were not acted upon, or largely ignored. Firstly, the research study established that the system of capitalist democracy, which comes in different varieties throughout world democracies, indeed brought about a situation where the electorate was effectively removed from its rightful place of being the principal, and had its place taken up by political parties (which are in fact, agents) - which (parties) governed on its (the electorate’s) behalf. This system, taken together with the Principal Agency and the Rational Choice Theories – fully explained the prevalence of maladministration and malfeasance in government in South Africa. Secondly, the study established that the OAGSA has done everything imaginable in its attempts to improve audit performance in government institutions – using the carrot rather than the stick approach. The legislative framework cited above, revealed that the OAGSA has the power to audit and report, while Parliament has the power to enforce corrective action. The lesson of this revelation is: that there is not much that the OAGSA can achieve without a high level of cooperation between itself and Parliament – if audit performance is to be effectively, and appreciably improved in South Africa. A disappointing discovery however was indirectly delivered to the world, through the results of a research study conducted by one Wehner in 2002, on Public Accounts Committees (PACs) (alias Standing Committees on Public Accounts (SCOPAs)) in world democracies. The Wehner study clearly demonstrated that there was nothing contained in these committees’ founding documents or enabling legislation – which in no uncertain terms, directed the committees on what procedures and processes to follow to ensure that their resolutions were acted upon. In other words there was no enforcement mechanism discernible for their resolutions. Thirdly, there were developments in case law in South Africa, which augured well for Constitutional Institutions in general. They are contained in court judgements relating to the mandate of the Office of the Public Protector (OPP). The question at the core of these developments was: whether the decisions or remedial action emanating from the OPP, were binding and enforceable. Two judgements cited as cases in point, one a High Court judgment and another a Supreme Court of Appeal’s (SCA’s), feature in the research report. The SCA, in summary found that decisions of administrative bodies of State – stand in fact and in law, until such time that a court of law invalidates them. The SCA ruled through citing a High Court judgement passed way back in 2004 - that Constitutional Institutions, although not organs of State per se – were certainly included in this 2004 finding, if one considers the rationale of this initial finding, taken together with the purpose for which Constitutional Institutions were established in South Africa in the first place. In conclusion, although visible root causes of poor audit findings appear overall to be poor consequence management and questionable leadership quality in government, the system of capitalist democracy is ultimately to blame. The system certainly had unintended consequences.

The investigation of this study focused on the ability of provincial government departments in South Africa to spend allocated revenues on activities adequately, with a direct bearing on social and economic development. The research presents an analysis of two selected Eastern Cape Provincial Government departments’ expenditure for a three-year timeframe (the fiscal years from 2009–2012), with a focus on the oversight role played by the Provincial Planning and Treasury department in instilling fiscal discipline in the provinces, and the potentially detrimental effect of under-spending on provincial service delivery. Among other things mentioned and discussed are, firstly, the fiscal policy; secondly, the funding of provincial departments; thirdly, the role and responsibilities of the Provincial Planning and Treasury department. The study adopted a qualitative methodology which focussed on the perspective of the insider who has experienced first-hand the activities or procedures under scrutiny in the selected provincial departments. Further, the qualitative researcher believed that first-hand experience provides the most meaningful data. In support of this, the respondents were asked twenty-two questions, the first five of which were based on the need to understand their personal particulars. A semi-structured questionnaire was distributed to 43 officials and 22 of those questionnaires were returned.

The Office of the Auditor -General’s role is by no means minor, for it plays a major role in curbing corruption and acts as a ‘’watchdog’’ of the nation over public funds. Amidst high mismanagement and misuse of public resources, as well as corruption, especially in developing countries, the major question one asks is how effective the Auditor -General can be in ensuring good governance within state departments so as to improve service delivery. The gaps between approved budgets and the realisation of policy and development goals stand among key governance challenges in many developing countries. Supreme Audit Institutions (SAIs) play an important role in holding governments to account. However, many SAIs including AGSA face serious challenges when trying to evaluate the expenditures and performance of government agencies. Therefore this study suggests that more resources should be invested in the office of the AG so as to allow it to carry out its duties without impediments. Good governance and public finance accountability is becoming increasingly important in the public sector. One means of effecting good governance and accountability is through auditing. For this reason the Office of the Auditor-General through the Constitution of the Republic of South Africa 1996 (Act 108 of 1996 section 216 (1)) was established to facilitate and encourage good governance and effective accountability through auditing.

Amathole District Municipality has for the past five consecutive years been receiving an unqualified audit opinion from the AGSA. This has been the trend, despite the commitment made by the Executive Mayor in April 2012 to the then Auditor-General, Mr Nombembe, that the leadership of the municipality would deliver a clean audit outcome by 30 June 2013. This scenario is replicated in the local municipalities within the district. Two of the district municipalities have for the past three consecutive years been receiving a disclaimer audit opinion. In one of the municipalities, this trend changed; and this municipality received an unqualified audit opinion for two consecutive years; while in the third year, it received a qualified audit opinion. The stagnation and regression in the audit outcomes of these municipalities may be as a result of either the non-implementation of audit-action plans to address the previous year’s audit findings; or there could be other factors resulting in the above scenario. The main objective of this study is to investigate whether the utilisation of the Auditor-General’s reports improve the audit outcomes in selected municipalities within Amathole District Municipality for the period 01 July 2006 to 30 June 2015.

The Office of the Auditor -General’s role is by no means minor, for it plays a major role in curbing corruption and acts as a ‘’watchdog’’ of the nation over public funds. Amidst high mismanagement and misuse of public resources, as well as corruption, especially in developing countries, the major question one asks is how effective the Auditor -General can be in ensuring good governance within state departments so as to improve service delivery. The gaps between approved budgets and the realisation of policy and development goals stand among key governance challenges in many developing countries. Supreme Audit Institutions (SAIs) play an important role in holding governments to account. However, many SAIs including AGSA face serious challenges when trying to evaluate the expenditures and performance of government agencies. Therefore this study suggests that more resources should be invested in the office of the AG so as to allow it to carry out its duties without impediments. Good governance and public finance accountability is becoming increasingly important in the public sector. One means of effecting good governance and accountability is through auditing. For this reason the Office of the Auditor-General through the Constitution of the Republic of South Africa 1996 (Act 108 of 1996 section 216 (1)) was established to facilitate and encourage good governance and effective accountability through auditing. To this end the study assesses the contribution made by the AGSA in encouraging good governance practices in government departments in the Eastern Cape Province.

One of the greatest challenges facing the world today is integrating industrial activities such as mining with environmental integrity and social concerns. Monitoring is fundamental to environmental management, both to assess the adherence to standards and to allow environmental managers to learn from practical experiences. However, a problem arises when the regulatory authorities cannot keep up with their mandate of enforcement and compliance monitoring. This research examined how the Department of Minerals and Energy (DME) implements the concept of sustainable development in the mining sector of the Eastern Cape (EC) and, more specifically, the extent to which the Mine Environmental Management (MEM) section is able to effectively monitor compliance of mining operations with environmental legislation. This was the first systematic compilation of statistical data for the DME, and presents the first study in the EC regional office in terms of environmental sustainability. Results indicate that there has been a sustained increase in mining activity over the past three years, possibly as a result of the boom in the construction industry and the accelerated road maintenance and improvement programmes in the Eastern Cape. Mining applications received by the DME have increased by 47% from 2006 to 2007 (January-May) and by a further 100% from 2007 to 2008. In addition to the increasing number of mining concerns being established, 98 mining concerns will need to apply for the conversion of their old order rights to new order rights by the 1st May 2009. Mining in the province is predominantly small scale with mining permits (mined areas less than 1.5Ha) making up 52.3% of all applications, with larger mining concerns contributing 29.3% and prospecting contributing the remaining 18.4%. In terms of compliance inspections, the EC regional office is required to conduct 120 environmental compliance inspections annually in terms of contributing to sustainable development. The MEM section exceeded this target since 2003. However, when the number of operational mines is considered, 120 inspections per year equates to one mine being visited, on average once every four years (based on 2008 data). Based on projected figures (number of compliance audits and number of operational mines) for 2009, the DME’s target of 150 inspections for 2009/10 combined with the limited staff D. Watkins – MBA Dissertation 2008 capacity will, at best, mean that mines would be inspected once in seven years. However, the target of 150 inspections will not actually even cover the expected number of EMP evaluation inspections. This has serious implications in terms of regulating the compliance of the mining concerns with their EMPR’s. The low level of compliance monitoring can be directly related to staff capacity and logistics problems at the regional office as well as provincial targets being based on staff capacity rather than the number of operational mines. Thus, considering potential environmental damage associated with mining operations and the capacity constraints of the MEM to conduct frequent compliance audits, it is likely that mining operations will have negative implications for sustainable development in the region. Currently there are many challenges facing the DME in terms of contributing positively to sustainability in the mining sector and there is a need to base future actions on the idea of continuous improvement and ultimately progress.