Denel confident its financial position is improving
The company is grappling with extensive disclaimers of audit opinion, including inadequate records
Arms-maker Denel said on Friday it was confident that its liquidity levels were improving, as it battles with severe problems in its record-keeping.
The company lost R1.7bn in its year to end-March, when it received numerous disclaimers, with the Auditor-General of SA saying the company had incorrectly applied accounting standards, and couldn't back up numerous line items, including inventory and operating expenditure.
Denel was one of the SOEs embroiled in allegations of state capture and slipped into such a severe financial crisis that in December 2017 it needed a government guarantee to enable it to pay its workers and suppliers.
Almost two years later, the company is still in a dire financial position and is struggling to pay salaries because of cash-flow problems. In October 2018, the Denel board announced that it had appointed a panel of forensic investigators to probe procurement irregularities and was working with the Special Investigating Unit (SIU) to identify and root out any corruption in the company.