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28 Sep
Eskom’s annual financial statements will be finalised two months late, by the end of November, the company said on Thursday.
In a statement to stakeholders, Eskom explained the necessary restatements of the 2021 financial accounts were under discussion with auditors. These would have a material effect on the 2022 accounts.
Eskom and other state-owned companies are obliged by the Public Finance Management Act to furnish the executive authority to which they report with the finalised accounts six months after the close of the financial year. These must be lodged in Parliament by 30 September.
On Wednesday Public Enterprises Minister Pravin Gordhan informed the Speaker of Parliament that the annual financial statement of Eskom would be delayed. Two other entities reporting to Gordhan – Denel and Alexkor – will also miss the deadline to finalise and submit their annual financial statements, he said.
In its notice, Eskom explains that the restatement to the 2021 financials include the adjustment of excess coal stocks from current to non-current assets and the restatement of some electricity debtors from current to non-current. The company also wants to adjust various values of plant, equipment and machinery as well other changes.
In a statement, Eskom said:
In his letter to the Speaker Gordhan said he expected the annual report to be finalised by the end of October or the beginning of November. He said that as the previous year’s audit ended late and Eskom had to change auditors, the audit for 2022 started late.
Eskom has been unable to service its debt for several years and is dependent on bailouts from the Treasury to remain a going concern. The company is hoping that a solution to transfer some of its debt to the national government will be announced at the October medium-term budget policy statement.
READ| Gordhan moves to ‘restructure and reconstitute’ Eskom board
In the case of state-owned arms manufacturer Denel, Gordhan says that a funding application has been made to the Treasury, “which is yet to be deliberated by Cabinet with a definitive outcome”. Denel has struggled to pay employees in full for more than two years and finally settled outstanding salaries in August. However, it does not have sufficient working capital to pursue orders or projected revenue to remain a going concern.
The board of state-owned diamond miner Alexkor has completed the annual financial statements, but due to a delay in the appointment of external auditors, the audit has not been completed, he says.
The request for more time for the three companies will not be the first. All state-owned companies must comply with the 30 September deadline or request an extension, but few have done so with the deadline only two days away.
This article has been updated with new information from Eskom
28 Sep
Carol Paton
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