Standing Committee on AG welcomes Gauteng High Court judgment on a matter between AGSA and RAF

19 April 2024

The Standing Committee on Auditor General welcomes the ruling of the Gauteng division of the High Court in Pretoria today in favour of the Auditor General South Africa (AGSA) on a matter between the AGSA and Road Accident Fund (RAF).
 
On 20 December 2021 the AGSA issued a disclaimer opinion in respect of the RAF’s annual financial statements for the year ending 2020/2021. According to the AGSA the overall audit outcome for the RAF regressed compared to the previous year. A disclaimer of opinion with material findings on compliance with legislation was issued.

The financial statements submitted for audit were not prepared in accordance with the prescribed financial reporting framework and were not supported by full and proper records as required by section 55(1)(a) and (b) of the PFMA among other things.
 
The RAF's case against the AGSA at court was in two parts. Part A sought to prevent the publication of the disclaimer. In Part B, the RAF sought to have the audit disclaimer set aside. The RAF failed in both applications. It has lost its court bid to change the accounting standard used to compile its annual financial statements in defiance of the Accounting Standards Board, the Auditor-General, and its line department, the Department of Transport.
 
The court ruled that the RAF had no ground to stand on, and none of its arguments withstood scrutiny. It was ordered that the costs of the AGSA, which included three counsels, be paid. The committee supports the judgement in favour of the AGSA and hopes that it will restore the integrity of the AGSA.
 
The chairperson of the committee, Mr Sakhumzi Somyo said the ruling clarified and settled the matter that was very protracted. “We are hoping that the RAF will comply and table the annual financial report to Parliament as prescribed by the court.”

Issued by Mava Lukani, Media Officer, Parliamentary Communication Services, 22 April 2024