South Africa: SABC’s Year End Accounts show loss of R910

Investment

The SABC's annual report and audited financial statements ending 31 March 2009, which were submitted to Parliament on 17 December, reflect a loss of R910m.

According to interim board chairperson Irene Charnley, the downturn in the economic situation did not play a major role in this recorded deficit. She also said that it would take time to fix the SABC’s problems as well as good leadership and commitment.

"The economic downturn inevitably impacted on the SABC's revenue, however it would be disingenuous to blame this alone for the results. The very public and sustained battles at a leadership level, for example, undoubtedly also contributed towards inadequate management of revenue and expenditure," said Charnley.

According to the Chief Financial Officer's statement in the report, other problems that negatively impacted on revenue included "schedule instability" and an increase in discounts offered to clients and agencies. (The SABC advertising discount put pressure on free-to-air channel, e.tv, to compete with a reasonable advertising rate which would could still maintain required operational revenue.)

SABC revenue increased 0.9 percent, from R4.705m in 2008 to R4.746m in 2009, while expenditure increased 19 percent.

The financial statements also reflect a payment by the previous board of R6.7 million to former chief executive officer Dali Mpofu.

External auditors gave the SABC a qualified report saying: "The director's report gives details of the auditor general's special investigation on procurement, fruitless and wasteful expenditure and non-compliance with company policies and indicates that the interim board is in the process of taking the appropriate action in relation to the allegations... In the meanwhile, we are unable to determine whether the various allegations and other matters that are still being investigated have an impact on the financial position.... as disclosed in the financial statements…”

Charnley paid tribute to the SABC staff who continued to provide a professional service during this difficult period.