Three of South Africa’s largest metros have laid the blame squarely at the door of the auditor-general (AG) after the JSE on Monday warned it would suspend their bonds if they fail to submit audited financial statements by end-February.
The cities of Johannesburg, Ekurhuleni and Cape Town have failed to produce their audited statements within the seven months required by the local bourse’s listing rules.
Ekurhuleni is widely regarded as the country’s industrial hub and Johannesburg as its financial centre, while Cape Town is often cited as one of South Africa’s best-run metros. Suspending their bonds would undermine their appeal as investment destinations.
With the municipalities at loggerheads with the AG’s office, the JSE has given them until the end of the month to produce their financials.
Threat of suspension
“This announcement is issued to warn holders of debt securities that the above issuer has failed to submit their financial information timeously and that the listing of the issuer’s debt securities and the registration of their placing document are under threat of suspension and possible removal,” the JSE said in a note to all three metros.
“If the above issuer still fails to submit their financial information by February 28 2026, the registration of the issuer’s placing document and the listing of the issuer’s debt securities may be suspended.
“This announcement has been placed by the JSE in the interest of holders of debt securities.”
Bondholders would be jittery if kept in the dark with no access to the books of municipalities owing them money.
Responding to Business Day on Monday, the AG confirmed it had not signed off on the metros’ 2024/25 audit reports “due to disputes, declared by the metros, related to the audits of these municipalities”.
“While we will not get into the specifics of the disputes, we can confirm that the respective parties are handling these matters in line with AGSA’s long-standing audit dispute-resolution processes.”
Jongizizwe Dlabathi, finance mayoral committee member (MMC) of Ekurhuleni, which has a budget of R65.5bn for 2025/26, said, “We have submitted our financials to the AG for audit on time in 2025. What transpired is that there is a dispute that has been lodged with the AG.
“The AG is still looking at that dispute. They have written to us to say they are looking at the matter and are committed to finalising it soon. We informed the council on Friday that there is a dispute with the AG.”
Loyiso Masuku, finance MMC of Joburg, which has a budget of R89.4bn for 2025/26, said, “We did partial submissions to council on January 29. At this stage the AG has not yet finalised and signed the report because there are certain components that are outstanding and some aspects we don’t agree with.
Siseko Mbandezi, finance MMC of Cape Town, which adopted a budget of R76.4bn for 2025/2026, said their financials still have to be audited by the AG.
”The AG’s report for the City of Cape Town is not yet complete. That’s the reason we have not yet submitted to the JSE.
“Last week Thursday, we received a letter from [the] AG to say they will finalise our audit report on February 16. We will then forward them to the JSE,” Mbandezi said.
“There is nothing malicious. Over the years we have submitted our financials on time and have obtained clean audits. Even this time, the financials were submitted on time. The issue was a difference of opinion on some issues raised by the AG.”
