Ann Crotty Writer-at-large

Net1 might have significantly understated profits earned from its contract with the South African Social Security Agency (Sassa) to distribute grants. An analysis of the financial statement submitted to the Constitutional Court in May suggests that Net1 subsidiary Cash Paymaster Services may not only have understated profits from the contract but may also have failed to provide details of other Net1 subsidiaries that profited from the contract. CPS claimed to have made a pretax profit of just more than R1bn from the five-year contract but an analysis of its financial statement claims this figure might be understated by R730m. Potentially more significant is the exclusion of profits earned by other Net1 subsidiaries due to the contract. The analysis, by the Alternative Information and Development Centre (AIDC) on behalf of the Black Sash and the Centre for Applied Legal Studies, is potentially damning for KPMG, which audited the statement. The statement was submitted in terms of the ...

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