An 'express' way to lose a job

"The AGM was unanimous in their view that the failure of the company to present audited financial statements at the meeting is irregular," the department said in a statement issued on Monday.

"There is a need for a more hands-on shareholder oversight of the regional airline and it is in lieu of the current challenges that it is prudent to review the board. The shareholder has therefore announced a new board of directors due to the high turnover of the previous board, which saw a record number of non-executive directors' resignations," the statement said.

The airline's management, board and external auditors have been battling since November last year to reconstruct the company's accounts. SA Express was obliged to withdraw its financial statements in November last year after it came to light that they were unreliable.

One of the major issues with the accounts involves an error in the treatment of an amount of R32-million for VAT that the company would not have been able to claim from the South African Revenue Service (SARS).

At the AGM, Gigaba also sacked Nkonki Incorporated, the airline's external auditors, which have questioned the quality of the information that has been shared with them by the airline's management.

The relationship between the three parties deteriorated to the extent that Gigaba has asked the auditor-general to take over the audit of the company's statements for the 2011-12 year as well as 2012-13.

The inability of the board and its management to present financial statements for the year ended March 31 2011 was described by Mayihlome Tshwete, a spokesman for the Department of Public Enterprises, as irregular.

"The irregularities relate to non-compliance, mis-statement of financial statements and evidence provided to the auditors which, in their opinion, did not meet the auditing standards. This has led to an adverse opinion from the Nkonki Auditors," the department said.

The department has been embarrassed by the publicity over the scandal at the airline.

Andile Mabizela, who has a strategy, aviation and legal background, has been appointed as chairman of the new board.

The new board, whose primary mandate is to turn the airline around, will retain Bridget Ssamula, "for the purpose of ensuring continuity and institutional memory", the department said.

The new board members are: Ezrom Mabyana, Karabo Tshailane-Nondumo, Neo Priscilla Moshimane, Shumani Tshifularo, Nosipho Gxumisa, George Mothemba and Noni Dibate.

Source: Business Day via I-Net Bridge