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Irregular expenditure
During the course of the external audit, the Auditor-General identified expenditure on specialised gym towels HUMAN
(branded and embroidered promotional items) amounting to R90 003 as irregular because the purchase of the
basic unbranded item did not satisfy local content procurement requirements.
Even though this transaction was identified, we do recognise that the entity continues to apply strict supply
chain management processes and no other material irregular expenditure occurred. There was also no fruitless
and wasteful expenditure. RESOURCES
Audit review of predetermined objectives
The Auditor-General has confirmed the quality, usefulness and reliability of performance management report-
ing which continues to be of a good standard. Closer at ention needs to be given to the matching of quarterly
performance targets with the entity’s planned annual performance plan.

Operational threats continue to affect SAIDS as a going concern
Last year the Audit Commit ee drew at ention to the Institute’s ability to continue as a going concern, as it
sought to cope with serious operational challenges not of its own making and quite beyond its control, such as
the withdrawal of World Anti-Doping Association accreditation for the Free State laboratory which compelled
the Institute to use foreign-based laboratories with at endant increases in test sample analysis and courier
costs.

As the Auditor-General has highlighted, the Institute is technically insolvent as its liabilities exceed its assets --
this despite considerable support from the National Lot eries Commission and a 5% increase in State funding.
We are pleased to note that management has worked hard to trim its budgets and contain expenditure under
challenging circumstances. This has enabled the entity to reduce its accumulated deficit by 46% which is an
excellent and most commendable performance.

Evaluation of Financial Statements
The Audit Commit ee has:
• reviewed and discussed the audited annual financial statements and performance report to be included in
the annual report with the Auditor-General, with the Chief Executive Officer and with the Board as the
Institute’s accounting authority
• reviewed the Auditor-General’s management report on the findings of the audit and management’s
response, and has reviewed all changes in accounting policies and practices
• noted and reviewed the Auditor-General’s assessment of the usefulness and reliability of performance
information examined.

The Commit ee concurs with and supports the Auditor-General’s opinion on the annual financial statements,
annual performance report and other legal and regulatory mat ers, and is of the view that the audited annual
financial statements and performance report can be accepted and read together with the Auditor-General’s
report.

Auditor-General South Africa
The Audit Commit ee confirms that it has met with the Auditor-General and that there are no unresolved issues.
Commendation
The Audit Commit ee would like to commend management for the work done in achieving an unqualified audit
report, and hereby continues to encourage management to strive towards achieving a clean audit.
The Commit ee would also like to thank Mr Graham Abrahams for his support as both a Board member and an
Audit Commit ee member, and being the link between the two to ensure that all material mat ers are addressed.

Adv. D. J. Mitchell, C.A.(S.A.)
Chairperson of the Audit Commit ee Drug-Free Sport
Date: 31 July 2018
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