SA Express to table results when going-concern status resolved, says Lynne Brown
The auditor-general is not satisfied the airline can continue operating for the next 12 months — but it is unclear how the issue will be resolved
State-owned airline South African Express has been unable to satisfy the auditor-general that it can continue operating as a going concern for the next 12 months.
This was the reason given by Public Enterprises Minister Lynne Brown for the airline’s failure to table its annual financial statements for the 2016-17 financial year in Parliament before the end-September deadline.
The airline tabled only its 2015-16 financial statements in the past few weeks.
The loss-making airline has already faced an application for liquidation by a creditor, which it is contesting.
Brown wrote a letter to National Assembly speaker Baleka Mbete explaining why SA Express would not be able to finalise its annual financial statements by end-September, as required by the Public Finance Management Act.
"The annual report and annual financial statements will be tabled as soon as the going-concern status of the airline has been resolved and the audit has been concluded," Brown said in her letter.
It is not clear whether resolving the going-concern problem will require further guarantees or a bail-out by the state.
Brown said SA Express "is required to demonstrate its ability to continue operating on a going-concern basis for a period of at least 12 months after the signing of the annual financial statements by satisfying the solvency and liquidity test set out in section 4 of the Companies Act".
The minister added: "SA Express has yet to satisfactorily demonstrate such ability to the auditor-general. As a result the audit cannot be completed in order to finalise the 2016-17 annual financial statements."