When six staff members of the internal audit team complained that a working environment was not conducive and staff morale was at its lowest, Free State finance MEC Gadija Brown referred the matter to the audit committee to assess and provide recommendations.
In a complaint letter dated March 29, aggrieved staff also highlighted “a sense of fear and uncertainty due to perceived intimidation”.
On July 5, interim audit committee chairperson George Higgins, an independent chartered accountant, reported back to Brown and head of department (HOD) Masechaba Sesing.
Sesing is the accounting officer responsible for the administration of the internal audit function and staff through the leadership of chief audit executive (CAE).
However, the CAE post has been vacant since the previous CAE retired.
Consequently, Motseko Maqabe has been acting in this position, as well as retaining his responsibilities as director of risk management responsible for oversight of the internal audit function.
According to a report, Higgins clashed with Sesing even before the audit review started.
He noted that he received significant resistance from Sesing in terms of the review, particularly when it came to engaging with internal audit staff members.
Sesing and the treasury hold a different view (see full response here).
But Higgins found that even “the legal advisor to the HOD became aggressive towards the committee, citing that we would jeopardise existing employee relations case”.
Higgins added: “The HOD requested that she obtain a legal opinion regarding the review and the right that the audit committee has, and that the audit committee not engage the internal audit staff until the legal opinion was obtained.
“The HOD disagreed with the audit committee, and a decision was made by the audit committee to engage internal audit staff without the HOD’s consent.
“The HOD refused to ask internal audit staff to come and meet with the audit committee.”
When he finally got to proceed with the review work, Higgins noted that certain matters that appeared administrative in nature were raised in the complaint letter, which impacted the unit’s effective functioning.
He found that the internal audit team raised matters consistent with the complaint letter sent to the MEC.
The list included changes in methodology or processes for communicating findings, fears of perceived intimidation that they are subject to disciplinary action in various forms by management of the unit, and uncertainty regarding the management and operation of internal audit.
“It was speculated that the root cause appears to be the subsistence and travel audit, where Maqabe and Sesing were subjected to an internal audit and findings raised against them, which the audit team claims are minor findings.”
The findings per the team were withdrawn, and no reasons were provided to the team, Higgins found.
Maqabe reportedly told Higgins’ team that his responsibilities within the department committee continued, and he was therefore carrying two critical roles in the department.
He blamed the internal breakdown on the non-appointment of a permanent CAE.
He also complained that the team was not following the methodology, and he, therefore, requested a change, including being involved in the approval of the audit programme.
“The department noted that there was leaking of information, and since the decision to remove the ASDs from the audit committee meetings, no leaks have occurred.
“It was confirmed that the acting CAE had not met the team formally for quite a period of at least three months.”
According to Higgins, Maqabe appeared overworked and overstretched, possibly not completing all his responsibilities.
Sesing agreed that the issues within the internal audit function stem from the fact that a permanent CAE has not been appointed, adding that “the decision to appoint Maqabe as the acting CAE, in her view, sound as if he is dependable and gets the work done”.
Her concern was also the leaking of information, adding that “since the members of the team were not invited to the audit committee, no information has been leaked”.
“The breakdown of the relationship within the unit could have been resolved, but it does appear that it is irreparable based on the interactions between the acting CAE and the rest of the staff,” states the report.
Higgins made a list of 12 recommendations including that the appointment of the permanent CAE be finalised as soon as possible once any related grievance process or other human resource processes have been completed.
