Incomplete audit of NSFAS concerns Committee on High Education

4 November 2020

Parliament, Wednesday, 4 November 2020 – The Portfolio Committee on Higher Education, Science and Technology has voiced its concerns regarding the delays in the finalisation of the audit of the National Student Financial Aid Scheme (NSFAS).

The committee was today briefed by the Auditor-General (AG) on the audit outcomes of the Department of Higher Education and Training and all entities falling within its portfolio. The committee was informed by the AG that there is a delay in finalising the audit of NSFAS. One of the reason given by the AG in finalising the audit is the unnecessarily long turnaround time by NSFAS in providing the required information to the auditors.

Committee Chairperson, Mr Philly Mapulane, said it was disappointing that this is the second year in a row that the audit of the financial statements of NSFAS is delayed mainly as a result of the inefficiencies within the entity.

"What is of serious concern is the fact that all these inefficiencies and failures to comply with the requirements of the AG in completing the audit happen during the period when the entity has been placed under administration. It does not engender public confidence that the situation seems to deteriorate under the watch of the Administrator who was brought in to salvage the fortunes of the entity and to turn it around," said MrMapulane.

The committee has requested the AG to expedite the audit and have it finalised before the end of the month. The committee is calling upon the Administrator of NSFAS to pull up his socks and ensure that all the required information relevant to the audit is supplied to the auditors timeously.

The committee was further briefed by the AG on the audit results of the higher education portfolio for the financial year 2019. The department also appeared before the committee to present its annual performance report and audit findings.

The committee was dissatisfied with the overall audit, although there are flashes of excellence in the portfolio preparing financial statements remained a challenge for most entities, especially in the TVET colleges sector. MrMapulane said TVET colleges needed to be assisted with preparing financial statements, and generally financial reporting.

“Financial management is an area that the government, and specifically our portfolio, cannot fail in monitoring. There has to be improvements all round and that regression in audits should be dealt with decisively.”

It was revealed that Ms Pretty Makukule is acting in place of MrTheunsTredoux, who has since left the department, whilst she is simultaneously the CFO for the Department of Science and Technology.

Although the committee is satisfied with the good work that Ms Pretty Makukule is doing at DSI, which led the department receiving three consecutive clean audits, we are however of the view that occupying two positions in different departments may not only be irregular but may compromise her. A proper guidance should be sought  from the Department of Public Service and Administration on the matter.

MrMapulane called on the department to provide an update on the programme, that has since stalled, where the department, in an arrangement with SAICA (South African Institution of Chartered Accountants), allocated financially qualified CFOs (chief financial officers) at colleges to assist with the financial management function.

Issued by Sibongile Maputi, Media Officer, Parliamentary Communication Services, 4 November 2020