Chief Financial Officer appointed by ANC-led Kouga Council, suspended

Ridwaan Abdullah, the Chief Financial Officer of the Kouga Municipality (KM) has been suspended ahead of the tabling of a damning report from the Attorney-General (AG) which exposes a number of serious financial and procedural irregularities.

The AG rapped the KM over the knuckles for not taking corrective action against Abdullah for his involvement in the pre-paid electricity debacle. They refer to a KPMG forensic audit that revealed he was involved in all stages of the tender process without declaring that his brother-in-law was a co-owner of the company that was eventually awarded the tender. KPMG recommended that he should have withdrawn from the process. Instead, he allegedly took possession of the bid documents, compiled the assessment report, acted as chairman of the Bid Evaluation Committee and attended the Bid Adjudication meeting where the tender was awarded. In their report, KPMG recommended that corrective action be taken. Electro-on-the-Move, the company that was awarded the tender, subsequently defaulted on payment of more than R6 million and it is speculated that this triggered the KM’s current debt problems with Eskom. The AG also reported that there were inadequate controls over activities performed by service organizations, including the supplier of prepaid electricity and he expressed concern that nothing was done about irregular expenditure of R27 million incurred during 2008/2009.

Dr. Eddie Rankwana, Municipal Manager, has confirmed that Abdullah will be on precautionary leave for a month while a forensic audit is done by an outside company. Carlien Burger, the KM’s Risk and Compliance Manager will be acting CFO in Abdullah’s absence.

This is a condensed version of the original report by Piet Liebenberg
OUR TIMES – Kouga’s community newspaper
15 April 2011