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Cape Town — The Treasury has withdrawn the decision which allowed Eskom to forego reporting irregular or wasteful expenditure, Eyewitness News reports.
According to Finance Minister Enoch Godongwana, the decision was made after consultation with the auditor general and a public outcry over the potential for the power utility to avoid fiscal responsibility. Godongwana said that the exemption was not intended to hide corruption, but to raise capital, and protect embattled Eskom’s credit rating and audit opinion.
“A major risk of having non-material, non-corrupt transactions reported in the annual financial statements include a higher likelihood of qualified audit opinion – which other listed companies do not face – that triggers loan covenants,” Treasury said in a statement.
According to Business Tech, the most recent financial statements from Eskom recorded over R11 billion in irregular expenditure while a total of R2 billion accounted for what was described as fruitless or wasteful spending.
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