The Local Government Sector Education Training Authority this week committed R3,9m to help fund auditing training for municipalities, to be provided by the Institute of Internal Auditors South Africa (IIA SA).

The two-year, entry-level programme is expected to train 200 municipal staff as internal audit technicians.

Many South African municipal and provincial authorities have suffered from a lack of knowledge of financial management. Limpopo province required a special intervention by the Cabinet last year, which the Treasury last month said had shown positive results. Cadre employment has also been blamed for some provinces being in dire financial straits.

Sector education and training authorities (Setas) have been criticised for a lack of capacity and results in training people on a significant scale. In March this year, Higher Education and Training Minister Blade Nzimande criticised Setas in Parliament, saying there was “little” to show for the R37,5bn given to them since 2000.

Mr Nzimande also said the Setas themselves lacked sound accounting practices.

Nevertheless, the IIA SA said on Thursday it had a role to play in making the country’s municipalities function better.

Bill Shellard, education and training manager at the IIA SA, said that “while the project will provide structured training for internal auditors and therefore be highly beneficial for all municipalities, it is small municipalities in non-urban areas in particular that will derive the most benefit”.

Small, rural and outlying municipalities are typically worse off financially than their big-city counterparts. The result is a severe lack of skills and experience in the critical area of internal auditing, according to Mr Shellard.

Dr Claudelle von Eck, CEO of the IIA SA, said internal auditors were “uniquely placed to make significant contributions to the effectiveness of municipalities” and were “vitally important to the economic health of the country”.

The IIA SA describes itself as the leading authority within the internal audit profession, offering technical guidance, professional training, certification programmes and professional development opportunities.

In January, a ministerial team took over the control of various functions of Limpopo province, which has a cash shortfall of more than R2bn at the time. The team found several financial irregularities in the administration of the province, such as illegal payments to service providers and money that had gone missing.

Early last month, Kenneth Brown, deputy director-general in the Treasury, told MPs that Limpopo’s financial performance had improved.

“It improved from a negative position in November to close at a positive R231m at the end of March,” he said. “The liquidity and solvency crisis is thus effectively solved.”

Source: Business Day