College of Law and Management Studies

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An analysis of the trends in integrated reporting by South African government-owned enterprises.
(2023) Omarjee, Ayesha.; Vanker, Salma.
In recent times, government-owned enterprises have faced a deficit in terms of accountability. Addressing this issue, there has been a call for an oversight mechanism to enhance governance and consequently, accountability within state-owned companies (IOD and PWC, 2011). Integrated reporting has emerged as a response to this demand, primarily due to its capacity to offer a comprehensive perspective on the factors that contribute to value creation for an organisation over different time frames. Recognising the advantages that integrated reporting brings to corporate governance, South African government-owned enterprises have acknowledged its potential and subsequently incorporated integrated reporting in accordance with King IV principles and the IR Framework. The objective of this research is to analyse the patterns in integrated reporting among government-owned enterprises according to The Public Finance Management Act of 1999, focusing on the financial periods of 2018, 2019, and 2020. This study assesses the depth of information disclosed by government-owned enterprises and its alignment with the suggestions and criteria set forth by the King IV guidelines and IR Framework for integrated reporting. This evaluation utilizes a scorecard methodology to gauge the degree of disclosure achieved by each individual government-owned enterprise. Based on the empirical facts from the analysis, it is clear and conclusive that the level of reporting and disclosure of government-owned enterprises has improved consistently over the years. This assertion is based on the evident adoption and the upward trend in the application of the Integrated Reporting Framework for integrated reporting by government-owned enterprises. Whilst the overall average level of disclosure is good, there is without debate a necessity for improvement in some critical areas highlighted in this research . Notable among these areas are leadership, governance, stakeholder relationships, organizational ethics, and corporate citizenship.
Assessing the Nazarites Church of God response to Covid-19 from a strategic management point of view.
(2021) Mabaso, Nkosiyephana Jerome.; Chummun, Bibi Zaheenah.
The intention of this enquiry was to assess how the Nazarite Church of God (NCG) from a strategic management point of view responded to the challenges brought about by the outbreak of Covid-19. The focus on this establishment (NCG) is due to its intended contribution to the society which is to mobilise the potential material and human resources available in order to realise the ultimate spiritual development of humankind. NCG operates within a dynamic environment where they are faced with various challenges emanating from socio-cultural, economic, political, health and technological challenges. Like business organisations, churches have been caught unprepared for such challenges and the reason could be lack of adequate strategies to deal with the same. The NCG in its strategy has infused the adoption of information technology and related infrastructures to support the church’s daily administrative processes and, equally important, to support the delivery of essential services such as the sermons, prayers and communication with its members and stakeholders including the society. The investigation used the Constructivist Grounded Theory Methodology to explore the activities that are performed by the NCG with the intention to determine and explore what strategic management approach was in place before the Covid-19 outbreak and during the existence of Covid-19. Strategic management is an important tool in any form of an establishment in pursuit of the institution’s mandate and or business objectives. Churches like profit-making organisations are susceptible to failures due to lack of proper strategic planning, execution, and monitoring, which if left unattended can shut the institution’s operations down with disastrous consequences to its members and stakeholders. The study has theoretically proven the application of a strategy framework which encompasses the understanding of the strategic position of an organisation; assessing strategic choices for the future; and managing strategy in action. The substantiation in proving the strategy framework emerged from the Constructivist Grounded Theory Methodology processes of data collecting through comprehensive interviews, initial coding, focused coding, memoing, and theoretical coding.
Case study: an evaluation of the comprehensibility of information security policies in a South African bank.
(2023) Razack, Riyadh Sayed.; Maharaj, Manoj Sewak.
Information security policy and its resultant implementation is seen as pivotal in organisations that want to protect their information both internally and externally. Employees are relied heavily upon to read and understand and therefore comply with the information security policy including all its principles. The study has used readability and comprehension tests to assess the policy to analyse what the minimum required reading level is, how much abbreviations and jargon are contained therein. Employees were surveyed to understand the implications of security policy on them, the study utilised interviews of staff and asked questions pertaining to awareness, ideal ways to eradicate jargon and technical terms as well as views around security policy implementation. Ultimately directing implications around improvements to be made, but not limited to the removal of jargon and technical terms. Further to this, recommendations are detailed for policy writers and implementors, as well as critical success factors for ISMS managers and security specialists who are tasked with crafting policy, embedding this through the organisation and ensuring staff comply and adhere to organisational information security strategy. A conceptual multidimensional framework to coordinate the significant outcomes identified in the study is also developed to enable robust information security design, and monitoring. Within the context of the study a number of important and noteworthy outcomes have been established. Any conceptual framework must provide a dimension to remediate the readability challenges. The other established outcome pertains to awareness and socialisation/training pertaining to policies, where respondents did not believe awareness of information security policies were adequate and accessibility was viewed as problematic, this was confirmed by the interviews where most staff did not know where to locate information security policy/ies. Respondents did not feel included in the development of policy and accompanying improvement mechanisms and consequently any conceptual framework which does not incorporate users is inherently flawed.
Death and dying in a constitutional democracy – an analysis of the South African criminal law and a call for law reform.
(2022) Bhamjee, Suhayfa.; Freedman, David Warren.; Reddi, Managay.
Murder is defined as the unlawful and intentional causing of the death of another human being. Suicide is not a crime. In South Africa, the act of assisting another person to commit suicide is prosecutable under the broad category of crimes classified as homicide – murder, attempted murder and culpable homicide; whether the assistance is the direct administration of a fatal drug or through the provision of the means by which to commit suicide. The current formulation of the common law is broad enough to include medically assisted yet consented-to deaths within the definition of the crime of murder. Some jurisdictions have decriminalised the acts of physician-assisted suicide and physician-administered euthanasia (collectively called voluntary active euthanasia -VAE) under specific conditions, notably the nature of the illness and the fact that a patient has requested and given informed consent for such assistance. In South African law, consent is not a defence to a charge of murder and, consequently, does not justify VAE, which is categorized as murder. When the elements of criminal liability are applied to VAE, they prove that the physician who assists a patient acts both causally and intentionally and cannot escape criminal liability because consent is not a defence in these circumstances. In contrast to VAE, deaths consented to, intended and caused through passive euthanasia practices (e.g. withdrawing treatment or withholding treatment and/or life-sustaining mechanisms and the administration of palliative care and palliative/terminal sedation) have been medicalised. In other words, this form of intentionally causing the death of a patient is seen as a legitimate form of medical treatment, even though it undeniably hastens and causes death. However, for policy reasons is not treated as nor categorised as the crime of murder, provided that the patient has consented to (either personally or through a proxy) such fatal medical treatment. The question of whether VAE should be de-criminalised was ventilated in 1998 when the South African Law Reform Commission considered arguments for and against decriminalisation of the practice, and a draft bill to that effect was prepared. To date, there has been no progress towards law reform by the Legislature. The case of Stransham-Ford re-ignited the issue. However, for various reasons, the court did not effect any change to the status quo. The Supreme Court of Appeal, however, did indicate that if a proper case was made, it might result in the development of the law to accommodate for a lawful form of medically-assisted dying. However, this would first require a thorough investigation into the reasons why the practice is unlawful and criminal in the light of the definitional elements of the crime of murder and the policy reasons for such criminalisation. Only once that has been thoroughly canvassed, can the question of the limit placed on autonomy and patient consent be gauged for whether consent could be a defence in the specific and limited circumstance of a VAE scenario. At its core, the focus turns to autonomy in decision making, policy reasons for disregarding autonomy, and whether arguments for and against decriminalisation can be sustained in light of the spirit, purport and objects of the Bill of Rights of the Constitution. Those in favour of the decriminalisation of VAE argue that the limit on autonomy and consent violates the constitutionally guaranteed rights to dignity, life and privacy. Those who are against it argue that the limit on autonomy is necessary to protect and preserve these very same rights. An analysis of these rights and the arguments can help determine whether reform or retention would be reasonable and justifiable under a Constitutional dispensation. This thesis considers the elements of criminal liability and the purpose for which the act of assisting another to die at their request has been criminalised to the extent that conduct on the part of an assisting physician is prosecutable as the common law crime of murder. The conclusion reached is that in the light of constitutional advancements, particularly in relation to the right to dignity as informed by autonomy, it is possible to decriminalise assisted dying when strictly confined to VAE in the medical context by moving from a position of criminalisation to medicalisation of the practice, as has been the case with passive euthanasia. This thesis advocates for neither a pro-life nor a pro-death policy but rather a pro-choice one, which would be in accordance with the cornerstone of constitutionalism in a state governed by constitutional democracy.
Developing a conceptual framework for factors that influence the effectiveness of internal audit within eThekwini Municipality=Ukwakha uhlaka lomqondo wezinto ezinomthelela ekusebenzeni kocwaningomabhuku lwangaphakathi kuMasipala weTheku.
(2021) Mwelase, Mfanufikile Khethabahle.; Chummun, Bibi Zaheenah.
Internal Audit effectiveness (IAE) is a relatively new field of study in the South African public sector. There are limited studies that have been conducted in this field, especially as it relates to Local Government. This study sought to identify factors that influence Internal Audit effectiveness for the development of a conceptual framework within the eThekwini Municipality. The study comprises of a qualitative and quantitative component. Twelve officials (92%) occupying senior management roles within Internal Audit were interviewed in the performance of the qualitative component whilst three hundred and eighty-eight (95%) municipal officials were surveyed during the performance of the quantitative component of the study. Quantitative data was analysed using the Statistical Package for Social Sciences and thematic analysis was applied to the qualitative data. The quantitative results indicate the need to improve Internal Audit Effectiveness within eThekwini Municipality. Municipal officials surveyed indicated that there were several improvement areas within specific factors influencing IAE which should be implemented to improve the effectiveness of the Unit. Respondents to the qualitative component of the study agreed with the quantitative results and further confirmed key factors with an influence on Internal Audit effectiveness, namely; the Chief Audit Executive Profile, Internal Audit Team Competency, Internal Audit Independence, Internal Audit Functioning, Effective Communication, Internal Audit Status, Compliance With IIA Standards, Senior Management Support, an effective Audit Committee and support by Political office-bearers. Both components of the study agreed that the Internal Audit Unit faced challenges, in varying degrees, on all the identified factors and that reforms should be introduced to improve Internal Audit effectiveness. A conceptual framework was then developed to serve as a basis for reforms to improve Internal Audit effectiveness. Internal Audit effectiveness, therefore, is a sum of all the influences of the identified factors and improvements thereto is not caused by improving one factor. There is a need to bring change through each of the identified factors. Iqoqa: Ukucutshungulwa kwangaphakathi kwendlela yokusebenza, phecelezi i-Internal Audit effectiveness (IAE) umkhakha omusha wocwaningo ekulethweni kwezidingo zomphakathi lapha eNingizimu-Afrika. Luncane ucwaningo olwenziwe kulo mkhakha, ikakhulukazi uma kubhekwa uhulumeni wasekhaya. Lolu cwaningo luhlose ukucubungula indlela okuqhutshwa ngayo ukucutshungulwa kwangaphakathi kwendlela yokusebenza nokuthuthukiswa kwendlela yokucabanga nokwenza kuMasipala waseThekwini. Lolu wucwanigo lwekhwalithethivu kanye nekhwantithethivu. Izikhulu eziyishumi nambili (92%) eziqhoqhobele izikhundla eziphezulu kulolu hlelo lokucutshungulwa kwangaphakathi kwendlela yokusebenza kwabanjwa izingxoxo ezisakuhleleka nazo ukukhiqiza imininingo eyikhwalithethivu kwathi imininingo eyikhwantithethivu yona yakhiqizwa kubahlanganyeli abangamakhulu amathathu namashumi ayisishagalombili neshishagalombili (95%) ezisebenzi zikaMasipala. Imininingo yekhwantithethivu yahlaziywa kusetshenziswa indlela yokuhlaziya izinombolo yakwa-Social Sciences kanti ukuhlaziya imininingo yekhwalithethivu khona kwenziwa ngokusebenzisa ukuhlaziya ngokwezindikimba. Imiphumela yekhwantithethivu iveza ukuthi kunesidingo sokuba uMasipala waseThekwini uthuthukise izinga lokwenza ukucutshungulwa kwangaphakathi kwendlela yokusebenza. Izisebenzi zikaMasipala zona zaveza ukuthi lukhona ushinstho olukhona ezinhlakeni ezithize mayelana nokucutshungulwa kwangaphakathi kwendlela yokusebenza. Abahlanganyeli bekhwalithethivu bayavumelana nemiphumela yekhwantithethivu futhi baqhubeka bafakaze ukuthi kukhona izinto ezibalulekile ezigqugquzela ukucutshungulwa kwangaphakathi kwendlela yokusebenza, okubalwa kuzona; isipiliyoni salabo abenza ucwaningo, ulwazi lwalabo abenza ucwaningo, ukusebenza ngokuzimela kwalabo abenza ucwaningo, indlela elungile yalabo abenza ucwaningo, ukuxhumana okuhle, isithunzi sokucutshungulwa kwangaphakathi kwendlela yokusebenza, ukulandela imigomo yokucutshungulwa kwangaphakathi kwendlela yokusebenza, ukwesekwa ngabaphethe, ikomiti elaziyo ukuthi lenzani, kanye nokusekwa ngosopolitiki. Zombili izinhlaka zalolu cwaningo ziyavumelana ukuthi ukucutshungulwa kwangaphakathi kwendlela yokusebenza kubhekene nezinselelo eziningi ezahlukene, kuzona zonke lezi zinto ezibalwe ngenhla, ngakho-ke ushintsho luyadingakala ekucutshungulweni kwangaphakathi kwendlela yokusebenza. Uhlaka lwemicabango lwabeseluyakhiwa ukuze kutholakale indlela yokuthuthukisa ukucutshungulwa kwangaphakathi kwendlela yokusebenza. Ukucutshungulwa kwangaphakathi kwendlela yokusebenza, ngakho-ke kubandakanya izinto eziningi ezinomthelela ekuthuthukiseni indlela yokwenza, hhayi nje ukuthi kugxilwe entweni eyodwa. Kumele kulethwe ushintsho kuzona zonke lezi zinto ezibalulwe ngenhla.
Impression management observation in South African district municipalities through attribution theory lens.
(2023) Mgoyana, Sithandiwe.; Phesa, Masibulele.
District municipalities play a crucial role in the local government as they have the mandate to provide services to the communities and capacitate and assist local municipalities in their jurisdiction for the provision of services delivery. Most South African district municipalities are struggling to fulfil the mandate of delivering services to the communities and this is evidenced by delivery protests for poor service delivery across South African communities. Inability to provide proper service delivery by most South African district municipalities causes them to get pressure from political opposition and the communities at large, hence they resort to partake in impression management. The mayor’s foreword is a narrative disclosure in the annual report that has no guideline in terms of what gets included in it. Management of municipalities have the discretion on what to include, which makes the mayor’s foreword open to manipulation, and as such, can be a place for employing impression management tactics. This study examined the presence of impression management tactics in the mayor’s foreword in the annual reports of South African district municipalities. The study followed the quantitative research method. Quantitative content analysis was used to analyse the mayor’s foreword contained in the annual reports of 34 district municipalities in South Africa. Data were extracted from the annual reports available on the websites of district municipalities. Impression management tactics, in the form of textual characteristics, were examined based on the length, use of passive voice, use of personal reference, use of positive tone, and observation of readability. The study revealed that district municipalities use impression management tactics in the mayor’s foreword. The study revealed that non-performing district municipalities have used a lot of personal references, and more passive voice than performing even though not significant, while performing have used significantly more positive tone than nonperforming district municipalities. The study revealed that performing district municipalities have lower readability scores than non-performing. Furthermore, there is no significant difference between performing and non-performing district municipalities on the length of the mayor’s foreword, use of passive voice, use of personal references and the readability score. The study brings new insights into the use of impression management tactics in the public sector, specifically in local government. It further extends the debate on impression management and self-attribution.
Institutional shareholders' monitoring and control over corporate decisions: evidence from JSE listed companies.
(2021) Obagbuwa, Oloyede.; Kwenda, Farai.
This thesis seeks to intensify our understanding of the responsibility of the institutional shareholders in corporate governance. Whereas several studies have investigated the efficacy of institutional shareholders' monitoring and have considered the diversity of their investment, there is a dearth of research on the effect of limited attention caused by distraction on their monitoring intensity and particularly on the reaction of the corporate executives regarding corporate decisions to the temporarily relaxed monitoring intensity in emerging market space. As a result of a shift in institutional shareholders' attention occasioned by exogenous shocks to an unrelated firm in their portfolios, the intensity of their monitoring of corporate activities dropped. The executives make decisions beneficial to them and harmful to institutional shareholders' interest and the firm's value. The study considers corporate decisions on executive remuneration, earnings management, investment inefficiency and mergers and acquisitions (M&A). These decisions are crucial to the growth of firms and return to institutional shareholders. However, due to agency problems, corporate executives' decisions on these activities tend to be for personal interest at the detriment of institutional shareholders' interest and firm value. Effective institutional shareholders' monitoring seems to be the antidote against opportunistic executives. But the intensity of their monitoring is affected by distraction caused by the external shocks to another firm in their portfolios. When this distraction occurs, the executives maximise the space to make decisions on their remuneration, manipulate earnings, invest in the unprofitable venture, and uncontrolled acquisition sprees that is of private benefits. The first empirical analysis in this thesis examines the impact of institutional shareholders' distraction on executive remuneration. The study shows that when shareholders are distracted and their monitoring intensity drops, the executives are inclined to manipulate their remuneration without considering institutional shareholders' interest and firm performance. The second empirical analysis examines the relationship between the relaxed institutional shareholders' monitoring intensity and executive decision on earnings management. The study reveals that the executives tend to manipulate both the discretional accruals earnings and real activities earnings for personal interest. The third empirical analysis indicated that executives could invest in projects with negative net present value (NPV) when the institutional shareholders monitoring is not sufficient. The final empirical research relates to the intensity of institutional shareholders’ monitoring to M&A executive decisions. The finding reveals that the executives could engage in an uncontrolled acquisitions spree of personal interest, jeopardise institutional shareholder’s investment and fail to improve the firm's value. The overall findings indicated that when institutional shareholders' attention is shifted, their monitoring intensity drops. The executives engage in corporate decisions that will not be in the shareholders' best interest and promote the firm's growth. These findings support the hypothesis that institutional shareholders monitoring intensity has a positive influence on corporate decisions. This insight has an implication for stakeholders and value-creating corporate governance mechanism. The study employed the more robust Generalised Method of Moments (Sys-GMM) estimation approach to analyse the data collected for firms listed on the Johannesburg Stock Exchange (JSE) covering the period 2004-2019.
Public financial management framework for the Department of Public Works in Durban Metro, South Africa.
(2018) Ngcobo, David Malusi.; Nzimakwe, Thokozani Ian.
During Apartheid era the Public Service of the RSA did not adhere to principles of good governance like (PFM), transparency and accountability. They were actual lip or spoken conceptual frameworks, but not executed to the latter. As a consequence (PFM) operational systems and processes experienced insurmountable challenges ranging from embezzlement and squandering of public funds. Unprecedented failures by government institutions and employees to comply with financial legislation led to fraud and corruption skyrocketing. Mammoth task facing democratic government was to overhaul and transform Apartheid regime PFM systems. The amalgamation and integration of SA’s Public Service into single unit was indispensable yet it caused gigantic challenges. One of the pressing challenges faced democratic government was to gain citizenry confidence, therefore public financial management reforms, transparency and accountability was at the epicenter to gain legitimacy. The SA’S Constitution affirms that execution of (PFM) regulatory reforms, systems and strategies must aligned with PFMA. Despite democratic government innovations of improving government financial operations and performances, some provincial and local governments had not complied with public performance-measurement. That led to some being placed under national or provincial administration under section 100 and 139 (1 and 4) or 137 of the MFMA under the SA’s Constitution. Theoretical frameworks and systems of performance measurement were designed to assist the employees to achieve efficiency, effectiveness and decision making. Successful changes envisaged by the democratic regime required financial, technical and human resources to bolster the process. Literature emphasized that resources are fundamental elements needed in improving public sector and subsequently bring the envisaged change. Literature consistent findings highlights that organizational change does not come cheap and it requires incentives and trade-offs to be successful. SA’s government changes were needed to redirect the scarce resources of the state towards a new host of avenues, developing new strategies, processes, practices, plans to implement proposed change, and redeployment of employees with expertise. Strategic interventions became an indispensable phenomenon why the change was envisage at that point. There was an urgency of reorganizing and restructuring governmental operational systems to test the recent innovations. Failure to provide necessary resources to beef up envisage change would have led to feeble execution efforts coupled with high levels organizational failures. PFM is the case study taking into cognizance PFMA’s impact in handling public revenue in government institutions like Department of Public Works. PFMA is an Act crafted to strengthen the objectives of sound public financial management. PFM and PFMA had to ensure that financial modernization and improvements were implemented. PFMA, of 1999 must safeguard that management manages operations with distinction, be held accountable by eradicating fraud, corruption, and wasteful expenditure in government. Twenty four years after 1994 democratic dispensation SA’s public service transformation continues, but government struggle to produce clean financial audits. SA is constitutional democracy mandated to implement PFMA in all government institutions. The study assesses success rate at which financial management reforms like PFMA, PFM, Integrated Financial Management System (IFMS) and New Public Financial Management (NPFM) mechanisms has achieved in handling public finances. PFM must ensure proper utilization of public funds by meeting defined standards of probity, regularity, efficiency and effectiveness.
Service delivery at the provincial sphere of government: a case study of Operation Sukuma Sakhe (oss) in Kwazulu-Natal.
(2023) Mkhize, Zwelini Lawrence.; Reddy, Purshottama Sivanarain.
South Africa has been plagued by challenges of ineffective service delivery linked to poor coordination, competition and contestation of powers due to overlapping constitutional mandates, lack of cooperation and poor alignment of state entities despite the provision for improved intergovernmental relations and cooperative government in Chapter 3 of the Constitution of RSA (Act 108 of 1996). This has resulted in rising public discontent, declining public confidence and protests. In response, the Operation Sukuma Sakhe (OSS) model was introduced by the Province of KwaZulu-Natal in 2009, to improve service delivery, eradicate structural poverty, inequality and its manifestations. This study investigates the role of OSS as a framework for advancing coordination and cooperation to achieve effective service delivery in KwaZulu-Natal. As the objective, the study sought to examine the challenges in service delivery, analyse the context and philosophy behind the adoption of the OSS, evaluate the role of districts in integration of services and how the war room entrenches participatory democracy and obtain lessons for district based planning and budgeting. Guided by the interpretivist paradigm, this study was designed as applied research of a qualitative nature, utilising semistructured interviews. The focus of data collection and analysis involved multiple sources of information and purposive sampling of 24 information-rich participants, representing Ethekwini, Harry Gwala, Umkhanyakude and Ugu municipalities, KwaZulu-Natal and national government and external stakeholders. The main findings of the study indicate that transformation in South Africa has been characterised by advent of new concepts in intergovernmental relations from unitary and hierarchical powers to concurrent competences which created the necessity for cooperative government. This complexity reflects the global trend in liberal democratic models in which governance is a partnership between state and civil society stakeholders. Using the governance theories by Pierre and Peters and the Systems Theory, it is argued that complex, multi-level governance systems (due to concurrent competences) require institutional policy implementation mechanisms that can deal with the political, economic and social dynamics that affect service delivery. This is critical in South Africa where the impact of government service delivery programmes is sensitive to the maintenance of governability, which is affected by issues of authority and legitimacy of the State, public confidence, the efficient use of limited ii resources, and prevention of mismanagement and corruption. The dissertation argues that OSS enabled effective service delivery through simultaneous implementation of five convergent principles: i) cooperative government, ii) intergovernmental relations, iii) good governance, iv) community participation and, v) integration of services. The convergence of these principles within OSS meant that the OSS operated as a coordinating institutional mechanism which is critical in multi-level governance and OSS further creates the necessary ‘spirit of cooperation’ akin to the German concept of Bundestrue. The study concludes that lessons obtained from the OSS in KwaZulu-Natal should be applied nationally for district-based planning and budgeting model to successfully emerge.
The managers’ perceptions of irregular expenditure In the KwaZulu-Natal municipalities.
(2018) Zungu, Amos.; Mkhize, Msizi Vitalis.
Background: While the Municipal Finance Management Act (MFMA, 2003) requires accounting officers to prevent irregular expenditure, municipalities continue to incur such expenditure. Aim: This study aimed to determine the managers’ perceptions of irregular expenditure in the KwaZulu-Natal municipalities; their perceptions of councillors’ oversight of such expenditure, and managers’ views on the capacity of Municipal Public Account Committees (MPACs) to fulfil their oversight role. Setting: The setting for this study is municipalities in KwaZulu-Natal. Methods: A descriptive and analytical cross-sectional design using systematic sampling was employed. The responses of 52 managers were analysed. Results: Managers agreed on the need for compliance with procurement processes and proper planning. They also concurred that irregular expenditure negatively impacts social transformation and wealth redistribution. The study respondents were of the view that irregular expenditure occurs due to manipulation and unfair practices, a lack of transparent supply chain management processes and politicians’ interests in tenders. In their opinion, councillors fail to investigate liability for irregular expenditure as required by section 32(2) (a) and (b) of the MFMA. They reported that serious cases of irregular expenditure where there were allegations of fraud, theft and corruption had not been investigated. Furthermore, disciplinary proceedings were not instituted against those that did not act in good faith and committed serious financial misconduct that resulted in municipalities incurring financial losses. Conclusion: Irregular expenditure harms municipalities’ image and negatively impacts social transformation. Municipalities, Cooperative Governance and Traditional Affairs (CoGTA) and the South African Local Government Association (SALGA) should invest in capacity building, implement effective fraud prevention plans and enhance the capabilities of those in charge of oversight. Contribution to the Study: The study makes a practical contribution towards understanding of the incidence of irregular expenditure and how it can be prevented. In addition, the study is the first to be undertaken in South Africa. This will serve as a foundation and source of reference for further studies.

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