South Africa finds itself in a familiar situation. Procurement processes bent to serve private interests, controls that exist on paper but are not physically seen, and political interference that sways outcomes. The findings emerging from the Madlanga commission are a pattern the country knows too well.
Yet beneath the outrage lies a more difficult question, one that continues to resurface with each new corruption scandal. Where were the auditors?
During the era of state capture, as billions were siphoned from entities such as Eskom and Transnet, auditors came under scrutiny for failing to flag or escalate glaring irregularities. Today, history appears to be repeating itself, with the controls not strong enough or just ignored. Either way, governance failure is to blame.
Recent developments only support this concern. The auditor-general has highlighted serious breakdowns in internal controls at SAA, raising questions about how oversight can deteriorate so significantly before anyone intervenes.
At the same time, recent testimony before the Madlanga commission has illustrated how easily supply chain processes can be manipulated, even within supposedly regulated systems.
Auditors, particularly those operating internally, are not docile observers. Their role is to identify risk, interrogate controls and raise red flags when systems begin to fail. They are, in effect, the early warning system within institutions. When fraud risks emerge or governance weakens, they are expected to escalate these concerns clearly and without hesitation.
For SMEs, corruption translates into hard and fast realities such as lost contracts, delayed payments or a closed door
However, auditing does not operate in a vacuum. Audit findings are presented to audit committees and boards, which carry the ultimate responsibility for acting on those insights.
When the same control failures recur year after year, it signals ineffective oversight at the highest levels. What we are witnessing is not a single point of failure but a systemic breakdown of accountability, which, increasingly, comes without consequences.
The Special Investigating Unit recently froze assets worth R76.5m linked to alleged corruption at Eskom. Procurement processes, it is alleged, were deliberately structured to evade scrutiny, with transactions split into amounts below R1m to bypass formal tender requirements. These are not sophisticated schemes. In fact, these are basic control breaches that should have been identified early.
This is where governance failure spills directly into the economy. For SMEs, corruption translates into hard and fast realities such as lost contracts, delayed payments or a closed door.
Procurement systems are meant to create access, particularly through lower-value contracts that enable SMEs to participate in the economy. When those same opportunities are manipulated and redirected, the system becomes exclusionary, and the result is a distorted and unfair market.
Legitimate businesses find themselves competing on access and connections. Some are pressured into informal pay-to-play dynamics that inflate costs and erode margins. Others are simply shut out. This is the cost of corruption, and it continues to reallocate opportunity away from those best positioned to drive growth, innovation and employment.
As governance failures increase, auditors who attempt to escalate issues can face significant pressure. In extreme cases, this risk extends beyond professional repercussions to personal safety
What makes this moment particularly concerning is that none of these warning signs is new. The AG has, for years, raised similar concerns across multiple institutions, yet most of these findings resulted in limited or no consequences.
As governance failures increase, auditors who attempt to escalate issues can face significant pressure. In extreme cases, this risk extends beyond professional repercussions to personal safety. In such an environment, silence can become the safer option, which should concern every South African.
When auditors are unable, or unwilling, to speak freely, one of the country’s most critical lines of defence against corruption begins to erode. The question, then, is not only whether auditors are doing their job but also whether the system around them allows them to be effective.
Commissions will continue to expose failures, and reports will continue to highlight risks, but if audit committees fail to act, if boards do not enforce accountability, and if management faces no real consequences, the same cycle will continue, just under different names, in different sectors.
For SMEs, this cycle can be fatal, resulting in contracts that never materialise, invoices that go unpaid, and businesses that do not survive.
As the Madlanga commission continues its work, the spotlight must widen to include those structures meant to safeguard the system. Accountability cannot stop at exposure but must extend to enforcement. Until it does, South Africa will remain trapped in a familiar loop, asking the same question each time; where were the auditors?
- Luncedo Mtwentwe is MD of Vantage Advisory and host of the SAICABIZ Impact podcast
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