The Independent Communications Authority (ICASA) would like to express its disappointment in the way the media is reporting on the audit qualification ICASA received for the 2010/11 financial year.
The heading of the article “ICASA’s missing millions” is very misleading, in that it fails to report accurately the state of the Authority’s finances for the period under review, and also fails to report accurately the Auditor-General (AG’s) findings on the Authority for the 2010/11 financial year.
The Auditor General qualified the Authority on two matters:
- The valuation, existence and completeness of the National Revenue Fund (NRF) debtors and related NRF creditors could not be confirmed.
- Irregular expenditure of R 5,057,453, and fruitless and wasteful expenditure of R 707,413.
In relation to irregular and fruitless and wasteful expenditure the Authority has embarked on a process to strengthen policies, systems and processes in relation to procurement and supply chain to prevent a recurrence of these findings in future.
As to the licence fee collections for the National Revenue Fund the explanation is very clear: In relation to the National Revenue Fund it should be noted that over the years the Authority has been using the spectrum system for, among others, generating invoices and capturing applicants’ data; and the LS system which is a radio propagation modelling system for technical analysis of frequency spectrum licences.
Once the system has captured the licensing data, this has to be transferred to JD Edwards, a financial system, so as to capture and reflect financial information such as invoicing and payment details.
What this means is that the two systems currently cannot “speak” to each other, and the intervention required for this purpose is for ICASA to purchase all the necessary modules of the LS system, and have the employees utilising the system to undergo the necessary training so as to implement it seamlessly.
It is in this regard that the Auditor General in his opinion said: “In my opinion, except for the possible effects of the matters described in the Basis for qualifiedopinion paragraphs, the financial statements present fairly, in all material respects, the financial position of ICASA as at 31 March 2011 and its financial performance and cash flows for the year that ended, in accordance with South African Standards of Generally Recognised Accounting Practices and the requirements of the Public Finance Management Act (PFMA)” (ICASA Annual Report 2010/11:102).
This confirms that, there are no monies that have gone missing from ICASA.
A two-year turnaround strategy will be developed and implemented to ensure effective and efficient Revenue Management within the Authority Nevertheless, measures are being introduced to improve the control environment. For example, the Administered Revenue Management Policy is being reviewed to address the shortcomings identified; amend legislation and licence fee regulations, and ensure that write-offs and the provision for doubtful debts are all aligned to accounting principles, including Treasury Regulations.
For all media enquiries contact:
Paseka Maleka
Tel: 011 566 3455
Cell: 079 509 0702
E-mail: pmaleka@icasa.org.za
