An Assessment Of Financial Management In Selected Municipalities Within The Ngaka Modiri Molema District Council

Abstract

This study investigates the poor financial performance of South African municipalities, which is often reflected in widespread disclaimer audit outcomes. The primary aim is to identify strategic financial management practices that can enhance the financial performance of municipalities within the NMMD Council. The Auditor General has pinpointed key vulnerabilities, namely procurement and irregular expenses, revenue management issues, and weaknesses in investment and asset management, all contributing to financial inefficiencies. Primary data was collected through semi-structured interviews with senior officers in selected NMMD municipalities using an exploratory case study design. The data was analyzed using NVivo 12 Pro. Key findings highlight the need for effective leadership and governance, emphasizing the importance of distributing power among financial officers to prevent fraud and corruption. Functional financial management systems, internal audit units, and effective audit committees are essential for sound financial management and governance. Addressing shortcomings in procurement processes and investing in human resource training is necessary to minimize non-compliance and enhance financial management. The study underscores the importance of continuous monitoring, risk management, and a zero-tolerance approach to corruption to ensure sustainable financial performance. Legal proceedings should address financial misconduct, with disciplinary actions taken against those found guilty. Municipalities will continue to fail unless consequence management is implemented and enforced.