South African Airways (SA, Johannesburg O.R. Tambo) has disclosed that a disagreement with South Africa's Auditor General over how to account for revenue from expired air tickets is the cause of the delay in the release of its FY23/24 audited financials. Still, the airline remains hopeful the audit will be completed by October.
"All efforts by the SAA board are underway to ensure that the audit of the FY2023/24 that ended in March 2024 is not delayed by this potential dispute with the Auditor General. The audit is expected to be concluded by October 2024," the airline said in a statement.
It described the disagreement with the AG as a "variance in the interpretation of some accounting standard regarding the treatment of revenue from expired air tickets".
This comes after Maropene Ramokgopa, Minister in The Presidency for Planning, Monitoring and Evaluation, in a letter to the Speaker of Parliament on July 26, referred to "a matter under dispute that may materially impact the 2023/24 results". Ramokgopa was explaining why she would be unable to table SAA's annual report, audited financial statements, and audit reports for the 2023/24 financial year by September 30, 2024, as required. Ramokgopa stated that ongoing audits for the years 2018/19 to 2022/23 have hindered SAA's ability to act on certain recommendations meant to improve audit results.
"Delaying the submission of the approved draft annual financial statements for auditing will allow SAA to implement some of these recommendations, thereby improving the audit outcome. An improved audit outcome will be invaluable as the company seeks to raise funding," she explained.
In its subsequent statement, SAA acknowledged that Ramokgopa had acted prudently in informing parliament that the potential audit dispute could delay the tabling of SAA's annual report. "SAA is fully cognisant of the importance of publishing its audited financials timeously, for both its legal obligations to accountability and transparency, as well as interaction with external financial stakeholders," it said.
The airline confirmed that its 2018/19 to 2021/22 annual financial statements were submitted to Parliament in December 2023 and that the external audit of the financial year 2022/23, which ended in March 2023, has also been completed.
